Union Budget 2019: The first Budget of Nirmala Sitharaman is going to be tricky. The former defence minister has inherited an economy that is suffering under the agrarian crisis and is staring at a slowdown. The output of the sector is at an all-time low leading to drop in the income of the farmers. With Budget 2019, the agri sector will be hoping to get a boost without the government succumbing to sops like loan waivers and cash transfers. PM Modi has also promised to double farmers' income by 2022 and Budget 2019 will have its eye focussed on that goal.
The ruling Modi government had said in the interim budget that it is committed to give boost to the sector and improve farm sector productivity by investing Rs 25 lakh crore. Things like seeds, fertilizers, credit, land and water management and technology together with investment in agri-rural infrastructure are important for the sector.
The sector is also in need of reforms and the central government including NITI Aayog is expected to work with states so that the farmer gets a fair share of the price paid by the final consumers. More private investments are needed in agri-startups and agri-research.
Another way Nirmala Sitharaman can push the sector ahead is by promoting farm exports. One of the major reasons for the low farm income is excess production. The Budget 2019 is expected to come up with an export policy that will reduce wastage and address the over-all growth challenges of the sector. Nirmala Sitharaman in her Budget 2019 speech is expected to talk about long term measures and implementation of broad changes in agri-marketing reforms and bring out the producer-centric price policy rather than sticking with the consumer-centric policy.
FULL COVERAGE: Union Budget 2019
The Budget 2019 is also expected to focus on giving a boost to allied farm activities such as fishery, poultry and animal husbandry. As per the data from NABARD, 23 percent of rural income is from cultivation and livestock and therefore non-agri income must not be ignored.
To conclude, the Budget 2019 is expected to come up with policies focusing on both supply and demand factors. Being a state subject, Center and states have to work together for reviving the sector.