Budget to prop up agriculture sector
Budget to prop up agriculture sector
The performance of agriculture sector during the year 2007-08, despite its record production of food grains, is still a cause for concern due its low rate of growth (2.6%) affecting the well being of farmers in various parts of the country. This calls for bold measures for bringing about a turn around of the agriculture sector and the announcements made by the finance minister are a pointer to such measures. The loan waiver for marginal and small farmers and the one-time settlement (OTS) of loans for other farmers and their entitlement for fresh loans with a target of Rs 2,80,000 crore during 2008-09 is expected to take care of the issues relating to the accessibility of credit from institutional sources and reduce the dependence of the resource poor farmers on money lender. The implementation of the Vaidyanathan Committee recommendations for revitalising the long-term co-operative credit structure ensures availability of increased credit for private investments in agriculture by farmers. The contribution of Rs 5,000 crore to the NRC(ST) Funds of Nabard helps in ensuring that the demands of the farmers for their production needs are met. Financial inclusion of the disadvantaged sections is facilitated through opening of additional bank branches in districts with predominant minority population, enhancing the income limits to Rs 18,000 in rural areas under the DRI scheme and access to Janashree insurance product of LIC for all women SHGs credit linked to banks. The increase in the corpus of RIDF by Rs 2,000 crore, coupled with the increased allocation under Rashtriya Krishi Vikas Yojana, Accelerated Irrigation Benefit Programme, the Rainfed Area Development rainfed farming and the setting up of the Irrigation and Water Resources Finance Corporation will facilitate in bringing more area under irrigation as well as in conserving land and water resources, critical to the performance of the sector. These investments will also help in stepping up investments in the private sector also. Various other measures announced for improving the performance of the sector include stepping up funds under the National Horticulture Mission, creation of special funds for plantation crops like cardamom, coffee and rubber, introduction of insurance scheme for select plantation and horticulture crops, etc. The overall thrust in the Budget is not only in boosting the performance of the agriculture sector but in ensuring that there is overall rural development through providing infrastructure- both physical and social, social security, human resource capacity development, off-season employment under NREGA, etc. These should help in achieving the goals of full employment, abolition of poverty and elimination of inequality in the medium term. The writer is Nabard chairman