Budget 2018 For Agriculture: 150% Hike in MSP, Other Sops & Allocations For Uplifting Rural Economy

New Delhi, Feb 1: Agriculture sector, and the rural economy at large, was considered to be at the centre of the Narendra Modi government's last full-year Budget under the current tenure. Speculations were rife on whether Finance Minister Arun Jaitley, in his Union Budget 2018 speech, would announce subsidies on fertilisers and seeds, increment in MSP prices and increase in allocation of funds for MNREGA, among other measures. Announcement on rural housing, micro-irrigation and crop insurance schemes were also on the cards.

Key takeaways for the agricultural sector:

- The biggest announcement made by FM Jaitley was a hike in MSP by 1.5 times. "The MSP for Kharif farm produce will be raised by 150 per cent," Jaitley said, further adding, "The government would not back away from its responsibilities by merely increasing the MSP. We would also take further steps for the overall upliftment of the rural economy."

- Jobs in the rural region would be created by promoting horticulture, food processing and animal husbandry, apart from the employment provided through MNREGA, Jaitley said.

- "Allocation in the food processing sector is being doubled to Rs 1,400 crore for FY-2018-19," Jaitley added.

- Rs 2,000 crore has been announced for for agricultural markets.

- Rs 500 crore has been allocated for 'Operation Green' -- a program to ensure year-round production of onions and tomatoes, the major products of mass consumption.

- A Rs 10,000 crore corpus will created for fishery development fund and animal husbandry fund. For those employed in the fishery sector, the services of Kisaan Credit Card will be extended to them.

- FM Jaitley also announced Rs 1,290 crore for the Bamboo farming sector.

- Under the Pradhanmantri Awas Yojana, a total of 14 lakh pakka homes will be built in the rural regions.

- Rs 1,300 crore will also be spent by the NABARD for setting up micro-irrigation facilities in the most parched districts of India.

Ahead of the release of Budget document, experts said this fiscal policy brings the last opportunity before the incumbent BJP regime to substantially improve the rural economy.

"It's a no brainer that focus of this Budget will be on agriculture sector. If we go back to 2015, it was a poor Monsoon season. In 2016, it was good. But demonetisation adversely impacted the sector. In 2017, the monsoon has been somewhat uneven. So naturally, steps need to be taken to uplift this sector," Sunil Kumar Sinha, Direct, India Research and Rating, said while speaking to Rajya Sabha TV.

According to T K Arun, Opinion Editor at Economic Times, the government is likely to focus on strengthening infrastructure in the rural sector, rather than merely focussing upon increasing the MSP and reducing the input costs.

Similar views were echoed by BJP leader Lalita Kumarmangalam, who said the government's focus could not remain only on uplifting the agriculture per se, but improving the entire rural economy.

"There is need for cold storage in rural sector for storage of farm produce," she said, adding that such measures would safeguard the rural economy from the exploitation of market.

(The above story first appeared on LatestLY on Feb 01, 2018 01:19 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).