FM drives stimulus tractor, attempts to revive farm sector
New Delhi: Union Finance Minister Nirmala Sitharaman on Friday came out with a slew of fiscal measures along with regulatory reforms to revive the agriculture and allied sectors under the mega Rs 20 lakh-crore economic package for the ‘Self-reliant India Movement’ announced by Prime Minister Narendra Modi recently.
The minister detailed eight unique steps backed by fiscal support to build local brands, cold-chain and warehousing infrastructure and promote animal husbandry and fisheries in the country.
Not just fiscal measures, three more measures dealing with regulatory reforms among others will also be carried out, Sitharaman said.
She pointed out that amendments to the Essential Commodities Act will be made and a legal route would be taken to free the farmers to sell their produce in any market that provides remunerative prices, rather than restricting such sales only to the licensee in the APMCs.
At present, under the APMC Act, farmers are required to sell their produce only in designated mandis at prices that are often regulated, and many times lower than the prevailing market price. This restricts the farmers’ earnings and curbs their ability to take their produce for further processing or exports.
Detailing the measures, Sitharaman announced that Rs 1 lakh crore would be spent to create warehouses and cold-chains for the agriculture sector. Besides, she announced a Rs 20,000-crore scheme for fishermen through the Pradhan Mantri Matsya Sampada Yojana (PMMSY) for integrated, sustainable and inclusive development of marine and inland fisheries.
Composition-wise, the scheme will include Rs 11,000 crore for promotion of activities in marine, inland fisheries and aquaculture, while the rest Rs 9 ,000 crore will be spent for creating infrastructure such as fishing harbours, cold-chain and markets.
Sitharaman also announced the launch of a National Animal Disease Control Programme for Foot and Mouth Disease (FMD) and ‘Brucellosis’ with a total outl ay of Rs 13,343 crore.
The minister further announced an Animal Husbandry Infrastructure Development Fund worth Rs 15,000 crore to encourage the establishment of processing plants for export of niche products. Besides, a Rs 10,000-crore cluster-based manufacturing scheme for nutritional products was also announced by the minister.
She said the scheme is in line with the Prime Minister’s call for ‘Vocal for Local’ with global outreach. It is expected to help 2 lakh MFEs attain FSSAI gold standards, build brands and boost marketing. Further, Operation Greens scheme whereby subsidy is provided on transportation and storage of tomato, onion and potato will be extended to all fruits and vegetable produce in the country.
Terming the decision as “TOP to TOTAL”, Sitharaman said that the government will shell out Rs 500 crore for the scheme.
Promotion of herbal cultivation also got a boost with an outlay Rs 4,000 crore. This is expected to add 10,00,000 hectares under cultivation of these plants in the next two years. Additionally, a Rs 500-crore beekeeping initiative has been instituted. This is expected to increase the income for 2 lakh beekeepers and provide quality honey to the consumers.
Confederation of Indian Industry’s Director General Chandrajit Banerjee said: “A combination of big-ticket reforms together with allocation of money for agricultural infrastructure and logistics is a welcome move to strengthen the sector that provides the highest share of employment in the country”.
Another industry body Ficci President Sangita Reddy said: “The ‘Essential Commodities Act’ had outlived its utility and by bringing a change in this, the government has ensured that investments in the agri-value chain get a boost.”
“Additionally, the announcement on introducing a central law to free up inter and intra-state trade of agri-products will help farmers in getting a better price for their produce and we hope that all states will adopt this in right earnest.”
Similarly, Assocham’s Secretary General Deepak Sood said: “The Rs 1 lakh-crore fund for strengthening post-harvest agriculture infrastructure with the help of aggregators, Farmer Producers Organisations (FPOs), cooperatives and even the start-ups in the farm sector would go a long way in modernising Indian agriculture, connecting more with the value chain of food processing. ”
“The government must also be complimented for walking on a twin-track of providing immediate relief to the farmers who are distressed due to lockdown, and ushering in landmark reforms like deregulation of sale of produce like cereals, edible oil, oilseeds etc.”
Trade Promotion Council of India’s Chairman Mohit Singla said: “The amendment in the Essential Commodities Act is the first welcome step by the government in deregulating the agri sector which will save the farmers from artificial price management activities by different forces. The prices will now be governed by market demand only and in the long term, bring better value to the far mer.”
PHD Chamber of Commerce and Industry’s President D.K. Aggarwal said the allocation of Rs 20,000 crore for fishermen under PMMSY will provide significant impetus to production and exports of marine, inland fisheries and aquaculture. The announcement on setting up of ‘Animal Husbandry Infrastructure Development Fund’ will tremendously support private investments in dairy processing, establishment of plants for export of niche products, strengthen value addition and cattle feed infrastructure, said Aggarwal.