Budget 2020: Agriculture Key in Revival of Economy

Agriculture will play a key role in India’s economy in Budget 2020. With surging food inflation and economy hitting a low growth rate, India needs action oriented policies.

Economy and Agriculture in Budget 2020

As agriculture supports livelihood of more than 50% population, it is essential to make this sector healthy. Besides, GDP growth rate slowing to 5% and 4.5 % in Q1 and Q2 of 2019-20 depicts an alarming situation. While the country aims to become a 5 trillion dollar economy, agriculture sector face crisis.

Overall Development

The policy makers must focus on to develop farm production, productivity and farmers income for overall growth. This calls for making a fine balance between prices of agricultural commodities and inflation. Agriculture and allied sector contributing just 15% to the GDP is a matter of concern. This sector showed a low growth of 2.9% in 2018-19 as per Central statistical office report. Budget 2020 to focus on agriculture and overall development of the sector.

Agriculture Key to Restoring India’s Economy in Budget 2020

Agriculture Procurement

Though the government increases MSP for major crops every year, it needs to procure more. This would ensure a hike in farmer’ income along with checking on inflation. This requires increasing both quality and quantity of warehouses to eliminate any wastage. Direct procurement necessary to cut middlemen and provide efficient supply chain in agriculture. Budget 2020 should focus on linking farmers directly to final buyers.

Forecast for Agriculture

Indian agriculture depends on monsoon and thus requires reliable forecast to prevent losses. For this, Indian Meteorological Department needs technological up-gradations that will assist farmers to take timely decision related to crop sowing. Budget 2020 to focus on agriculture to increase farmers income. Further, this will help banks to knock the chances of bad debts of farmers.

Exports and Expenditure on Research in Budget 2020

Exports have been falling for continuous months this financial year. The government must focus on to extend and provide export incentives such as MEIS, TMA and Drawback to exporters. This will result in increasing exports from India. Further, education and training are two important aspects that need funds. As a result, farmers shift to less monsoon dependent activities like animal husbandry and fisheries.

Infrastructure and Technology in Budget 2020

There is a need to develop infrastructure that supports lower cost of transportation. Also, it should back up agricultural start ups in processing data that would aid farmers in crop planning. Besides, portals like eNAM must be made more efficient to deliver benefits to farmers.

In addition, government plans to launch fund of funds to tackle liquidity crisis in MSMEs. In all, Budget 2020 should focus on making proactive policies and programmes to develop sustainability in agriculture.

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