“A right cause never fails “ said Mahatma Gandhi and Finance Minister Arun Jaitley quoted this in his February 2016 Budget speech. As experts study this year’s Budget, rural wealth creation is the single most stand out item. The rural economy’s crying need to be integrated into overall economy, its importance in poverty alleviation and wealth creation are well understood by the government. I’m greatly enthused by the holding up of the case for rural economy in this Budget.
I would dare say that embracing doubling farm income at this point of economic history is an imperative, not an option. With the right mixture of growth in rural and urban, India can rightfully seize its moment under the sun. This Budget has made the right pitch for investment, growth and job creation in Bharat. The Economic Survey, bright and bold as it is, came out with disturbing facts about the current state of rural economy, of farm distress where subsidies are counter-productive and a worrying future where climate change will reduce 25% of the farm income. Add to this that 54% of Indian work force depends on agriculture, agri production is non-remunerative, farm wages are flat, this lethal mixture threatens to result in a generation of “rural drop outs” from the great Indian story of prosperity.
The dark clouds of foreboding are not bereft of silver linings. Indian demography, rural or urban, is young and very tech- savvy. Enrolling them for a rural resurgence by leveraging technology is a great leapfrogging possibility. With technology, the time for “ strategic cultivation” is here — precision farming, nano technology, augmenting irrigation, farm to fork supply chain management. How do we ever rise up to this massive task? It is by letting a thousand flowers bloom in the rural areas. Rural start-ups and entrepreneurship skills should spring up everywhere and business models based on agro and other industries should be around a new paradigm of ease of doing business in Bharat and creation of an interconnected agri market. Cold storages and processing industries will prevent agri produce losses. If exports are an imperative for India, rural economy can play a stellar role. Supply chain management and processing industries can create export goods leveraging inter-state and and international linkages, contributing to State and national GDP. Augmenting other income streams — dairy, poultry, horticulture, fishery etc. will add to farm wealth. Concerted effort to produce, process and prosper is the new ‘mool mantra.’ Farm to global fork is a step closer.
If we look at rural allocation, the infrastructure allocation itself counts more than ₹14 lakhs crore. This, along with various other boosters like doubling allocation for food processing, emphasis on “Operation Green” in line with “Operation Flood,” simplification of MSP calculation, special allocation for ₹2,000 crore for agri market development, expanding scope of Kisan Credit Card and integration of eNAM with the local haat will help in realising farmers’ income. The Budget has signalled the government’s intent and the stakeholders have to join hands to nurture the seedlings planted by the Union Government.
BL: 14-11-2013: MUMBAI: V.S. Parthasarathy, CFO & Group CIO, Mahindra Mahindra Ltd at the announcing company’s results in Mumbai on Nov. 14, 2013.Photo:Shashi Ashiwal
(V.S. Parthasarathy is Mahindra Group CFO)
