The annual Budget for the year 2022 was presented on 1st February 2022. With the 75th year of independence, the government is set to launch its vision for the further 75 years (Amrit Kaal). The budget for this year revolved around four pillars. These are PM Gati Shakti, Productivity and Infrastructure, Financing of Investments, and Inclusive growth.
Under inclusive growth, Finance Minister Mrs. Nirmala Sitharaman laid out the plan for the agricultural sector. Like many other sectors, budget allocation for this sector is neither a shock nor a surprise. The Union government’s lofty target of doubling farm earnings, which is slated to expire this year, had no mention in the Budget speech (2022).
The entire budget of the sector increased marginally to Rs 123,960.75 crore in 2022-23, up from Rs 118,257.69 crore in 2021-22. This budget was expected to bring some major changes as it was announced after farmers’ protests demanding guaranteed MSP ended. The three controversial farmer laws brought in in 2020 were also repealed. Approximately 58% of India’s population relies on agriculture as their primary source of income. The total agricultural and allied products exports stood at US$41.25 billion in FY21.
Source: Economic Survey 2021-22
As per Economic Survey 2021-22, the sector grew at 3.6 percent in 2020-21 and improved to 3.9 percent in 2021- 22. The agricultural and related sector’s performance has been robust to the COVID-19 shock. This budget focused on capital expenditures rather than revenue expenditures to provide a sustainable vision for the economy. This can be observed after a deep cut in the amount allocated under PM-AASHA. It was only allotted Rs 1 crore for the fiscal year, as opposed to Rs 400 crore in 2021-22. The Market Intervention Scheme and Price Support Scheme (MIS-PSS) was granted Rs 1,500 crore, which is 62% less than the Rs 3,959.61 crore allocated in the revised FY 2021-22 projections (RE).
The major highlights of this budget in the agriculture sector are:
Agriculture is the lifeblood of India’s rural economy, which is why it is always a top focus in the Union Budget. The initiatives taken by the government will go a long way toward ensuring that the industry continues to contribute significantly to India’s economic success.
Author: Swati Shubham