The budget has some positive aspects, especially on food processing and agricultural research, but is largely silent on attracting youth to farming.
In this year's budget, Union Finance Minister Pranab Mukherjee has essentially tried to consolidate the gains from the initiatives he had launched during the previous two budgets. Thus, in agriculture there is no new initiative except increasing the target for agricultural credit to Rs.5,75,000 crore during 2012-13. This represents an increase of over Rs.1,00,000 crore from last year. The interest rate of four per cent recommended by the National Commission for Farmers has been retained for those who are able to repay the loans promptly. On the credit side, there are also proposals for technologically upgrading the Kisan Credit Card. Similarly, there is a proposal to amend the Bill relating to the National Bank for Agriculture and Rural Development.
Food processing, water recycling
The budget contains an assurance that the subsidy required for operationalising the legal commitments contained in the National Food Security Bill will be made available. The exact figure will be known only after the bill is finalised and adopted by both the houses of Parliament. The Finance Minister has also proposed to improve subsidy delivery, particularly for fertilizer. The subsidy will be paid during this year directly to farmers' accounts in 50 selected districts. Obviously the details will have to be worked out since according to the current policy, fertilizer subsidy is to be based on nutrients and not products. Nutrient-based subsidy will be effective only if farmers are provided with soil health cards that contain information on the macro and micronutrient status of soils. Among the earlier initiatives whose gains are to be consolidated, is the initiative to bring the green revolution to Eastern India. This has resulted in an additional paddy production of seven million tonnes during kharif 2011. Encouraged by this result, the Finance Minister has increased the allocation for this scheme to Rs.1,000 crore from last year's Rs.400 crore. Similarly, the 60,000 pulses villages project is to continue since it has already resulted in raising pulses production to nearly 18 million tonnes.
The budget also provides substantial additional allocation to irrigation and agricultural research and extension. A new national mission on food processing is to be started in order to minimise spoilage. This is a good step as currently there is a mismatch between production and post-harvest technologies. The proposal to set up an Irrigation and Water Resource Finance Company is also a good one, provided it concentrates on supporting rainwater harvesting through Jal Kunds, wastewater recycling and micro irrigation. The Finance Minister has also proposed a programme for coastal aquaculture with an outlay of Rs.500 crore. Based on past experience, it should be ensured that only Low External Input Sustainable Aquaculture practices are promoted, since otherwise there will be serious environmental problems including groundwater pollution along the coast.
The Finance Minister has announced various excise and custom duty exemptions which should help to stimulate additional investment by the private sector. Also provision has been made for increasing the grain storage capacity by two million tonnes through the construction of modern silos. It is hoped that the additional storage capacity for five million tonnes will be added very soon, since the stock position with the government as on February 1, 2012 was 23.4 million tonnes of wheat and 31.8 million tonnes of rice. During the next two months, the government will have to buy at least 25 millions of wheat and about 20 million tonnes of rice. It is obvious that the neglect of this vital sector over a long period of time cannot be made up in one or two years. However a decentralised grid of modern grain storage structures for the safe storage of at least 50 million tonnes will be essential if we are to implement the provisions of the National Food Security Bill effectively.
Food Security Bill
The Economic Survey (2011-12) has pointed out that though the contribution of agriculture and allied sectors has come down to 13.9 per cent of GDP at 2004-05 prices as compared to 14.5 per cent last year, agriculture continues to be the primary employment providing sector in rural India. As per the NSSO report, for every 1,000 people employed, over 750 persons are employed in the agriculture sector both in rural and urban areas. Thus the diminishing contribution to GDP of the farm sector is accompanied by an increasing responsibility for employment. Our population is young and India will be the youngest nation by 2020. Unfortunately the budget does not contain any provision for attracting and retaining youth in farming, which is the greatest challenge facing Indian agriculture today. With the enactment of a Food Security Bill which confers legal right to a prescribed quantity of food grains, attention to increasing the productivity, profitability and sustainability of small farm agriculture has become even more urgent. We cannot implement a Food Security Bill based on imported food grains. Therefore, steps will have to be taken to create interest among educated young women and men in rural areas for taking to agriculture as a profession. Already steps have been taken to extend support to women farmers through the Mahila Kisan Sashaktikaran Pariyojana. A similar programme is now needed for Yuva Kisans.
In the final analysis, agriculture is a state subject and state governments will have to take the lead in designing and implementing programmes with the active participation of Panchayati Raj institutions. If agriculture goes wrong, nothing else will have a chance to go right in our country.
(M.S. Swaminathan is Member, Rajya Sabha.)