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Union Budget 2025-26: Agriculture and Rural Development

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Context:

Update on a previous year’s initiators with continuation of schemes which are well functioning.
The reduced gap between Budget Estimates (BE) Revised Estimates (RE) signifies better performance in implementation.

Resource Allocation Sector wide

  • Agriculture, animal husbandry, fishery, food processing, public distribution, rural infrastructure, and employment got from 3% to 6% higher allocations.
  • Consumer Affairs reduced by 58% because of the disappearance of the price stabilization fund.
  • Ministry of food processing got 33% more, mainly for micro food processing at household level.

Key New Initiatives and their likely Impact

  • Dhan Dhanya Krishi Yojana (₹ 100 lagging districts)
    • It focuses on agricultural productivity, credit access and infrastructure.
  • Rural Prosperity and Resilience Programme
    • It will focus on underemployment and migration, aiming to address it through skilling, technology integration, and revitalizing economies.
    • Needs to be district specific plans because of varied needs and level of infrastructure in each district.

Pulses Self Sufficiency Mission (₹1,000 crore)

  • Targets tur, urad, and masoor production.
  • Strategy: tech driven productivity improvement (price support through procurement).
  • Challenge: Open ended procurement risks (estimated cost ₹13,000 ₹19,000 crore according to market condition).

High Yielding & Climate Resilient Seeds Initiative

  • Intended to improve seed availability and affordability.
  • Continuation of efforts in climate resilient farming from the past.

Value Chain Development for Fruits & Vegetables (₹500 crore)

  • Last year’s effort on vegetables alone to extend it this year to include fruits.
  • Goal: Efficient supply chains & price stability for farmers.

Sector Specific Missions

  • Deep sea fishing: Continuation of shrimp farming program from the previous year.
  • Cotton productivity: Much needed reform long overdue.
  • Makhana Board in Bihar: Local agricultural processing is given a fillip.

Structural Challenges in Urgent Attention

  • Agricultural Market Malfunction
    • The density of regulated markets is varying from state to state. (Punjab: 119 sq km per market vs Meghalaya: 11,215 sq km).
  • All India average
    • 487 sq km per market which is not even close to the 80 sq km target recommended by National Farmers Commission (2004).
  • The very urgently due GrAM scheme (₹2,000 crore under NABARD) for upgrading of 22000 rural markets needs fast track processing.

State Coordination and Governance Deficits

  • Agriculture and rural development are State subjects as per Constitution.
  • Proposal for an Inter-State Council (as GST Council) will give impetus for better coordination between Centres and states.

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