Union Budget 2019: Key Highlights for Indian Agriculture

NeML Budget Key Highlights

As India’s first woman Union Minister for Finance and Corporate Affairs, Ms. Nirmala Sitharaman presented her maiden Union Budget for FY 2019-20 yesterday (5th July).

Announcing the motto of “Gaon, Gareeb aur Kisan” for strengthening India’s rural economy, the Hon. Minister announced a slew of policy measures that will directly impact India’s agriculture sector.

Below is a snapshot of 5 key pro-agriculture measures that were announced in the Union Budget 2019:

1. Boosting the Dairy Sector

To boost the dairy sector in India, the government has propagated dairying through cooperatives by creating infrastructure for cattle feed manufacturing, milk procurement, processing & marketing.

2. Establishment of a robust Fisheries Management Framework

In the last year’s Union Budget, the government had included Fisheries, Acquaculture and Animal Husbandry in the definition of ‘agriculture’.

In this year’s Union Budget, the government has announced the launch of Pradhan Mantri Matsya Sampada Yojana (PMMSY) – a robust fisheries management framework to address the critical gaps in infrastructure, modernization, traceability, production, productivity, post-harvest management, and quality control in the fisheries’ value chain.

3. Setting Up LBIs and TBIs

The government has announced a Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship (ASPIRE) which will oversee the setting up of 80 Livelihood Business Incubators (LBIs) and 20 Technology Business Incubators (TBIs) that will skill 75,000 entrepreneurs in agro-rural industry sectors.

These agro-rural entrepreneurs will be supported by the government in driving value-addition to farmers’ produce from the field and for those from allied activities.

4. Push for ‘Zero Budget Farming’

The Hon. Minister has urged Indian farmers to adopt Zero Budget Farming (ZBF) as an important tool to become self-reliant.

ZBF is a form of natural farming wherein farmers do not rely on chemical fertilizers or artificial seeds as the primary input materials for growing crops. With minimal input costs, the ZBF model drastically reduces input costs and maximizes farm profitability.

The concept of ZBF was first implemented 25 years ago in Karnataka by agriculturist Subhash Palekar, and inspired by its success, many farmers practice ZBF today in India.

5. Scaling up FPOs

The government has announced the creation of 10,000 new Farmer Producer Organisations (FPOs) to ensure economies of scale over the next 5 years.

This is definitely a big boost for Indian farmers, especially for Smallholder Farmers (SHFs) as FPOs play the crucial role of consolidating agri produce and bridging the gap between farmers and bulk buyers.

Speaking on the budget, Mr. Rajesh Sinha – MD & CEO, NeML said “The budget is an enabling budget that provides for incentives and initiatives that would further strengthen the initiatives to enhance the income of rural households. Increased focus on allied sectors in agriculture like Fisheries, Dairy and Rural Enterprises (Incubators, FPOs) has the potential to generate new jobs in the rural areas of the country.”

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