The Indian government will focus on increasing on farm and non-farm incomes across rural India, said Finance Minister Arun Jaitley while delivering the Union Budget 2018 on Thursday. This includes higher support prices, liberalised agricultural exports and technology driven improvements in access to markets. The measures are intended to help the government fulfill its promise of doubling farmer income by 2022.
Decisions announced by the government include:
- An increase in the support price for the Kharif season to 1.5 times of the crop’s cost
- Liberalising agricultural exports
- Strengthening the e-national agricultural market network
- Increasing the limit for agricultural credit to Rs 11 lakh crore from Rs 10 lakh crore last year
The decision is part of the government’s focus on the agricultural sector and the rural economy over financial year 2018-19, said the Finance Minister. Other areas of focus include providing affordable healthcare to the weaker sections, and investing in infrastructure, Jaitley said.
The rural economy has thrown up conflicting signals over 2017-18. The agriculture segment faced the brunt of a sharp fall in perishable prices in the aftermath of demonetisation. In addition, segments like pulses saw prices plunge due to a spurt in production. A good monsoon also did not provide much relief. Uneven rainfall meant that both kharif and rabi output have been lower than expected. Advances estimates released by the Central Statistical Office peg agriculture growth at 2.1 percent in 2017-18.
The government has committed to doubling farmer income by 2022. Achieving this without steep increases in minimum support prices, which can be counterproductive as they spark inflation, is seen as a tall order.
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