Announcing an increase of 18 per cent in the total plan outlay for the agriculture sector, Finance Minister Pranab Mukherjee said on Friday that the sector would continue to be a priority for the government. The focus appeared to be on consolidation of the ongoing schemes.
Mr. Mukherjee, however, stressed that supply-side constraints in the sector had pushed inflation last year, but added that steps taken to bridge the gaps in distribution, storage and marketing systems to strengthen food supply chains had helped manage inflation.
“Monthly food inflation declined from 20.2 per cent in February 2010 to 9.4 per cent in March 2011 and turned negative in January 2012.
Though the February 2012 inflation figure has gone up marginally, I expect the headline inflation to moderate further in the next few months and remain stable thereafter,” he said in his budget speech.
A large share of the enhanced allocation would go to the Rashtriya Krishi Vikas Yojana and the programme of Bringing Green Revolution to Eastern India.
Other programmes for growth of food security, horticulture, extension services, oilseeds and micro irrigation would be implemented in mission modes.
The credit target has been raised to Rs. 5,75,000 crore and the interest subvention scheme for providing short-term crop loans to farmers at 7 per cent interest per annum would continue.
An additional subvention of 3 per cent would be available to farmers who paid up promptly.
The same interest subvention on post harvest loans up to six months against negotiable warehouse receipt would also be available.
The Kisan Credit Card scheme would be strengthened with the provision to facilitate use of the card at ATMs.
A short-term Regional Rural Bank Credit Refinance Fund would be set up to enhance their capacity to disburse short-term crop loans to small and marginal farmers. For this, NABARD has been allocated Rs. 10,000 crore.
The government will operationalise an Irrigation and Water Resource Finance Company to mobilise funds for irrigation projects.
A new Centrally-sponsored scheme titled “National Mission on Food Processing” would be launched in cooperation with the States in 2012-13.
A fund of Rs. 200 crore has been set aside for agriculture research. Funds for the Mahila Kisan Sashaktikaran Pariyojana — aiming at the betterment of women farmers — has been raised to Rs. 3915 crore.
The Minister announced assistance for agricultural and rural institutes with Rs. 100 crore each going to Kerala Agriculture University and Acharya N.G. Ranga Agricultural University in Hyderabad.