National agri market, FCI reform Modi’s keys to revive farm sector

With food volatility a big concern, Centre sets up price stabilisation and agri-infrastructure funds.

By: Express News Service | New Delhi | Published: July 11, 2014 1:53 am

Union finance minister Arun Jaitley on Thursday gave a fresh push for creating a national market for agricultural produce and planned reforms in food grain management through “restructuring” the FCI.

In his Budget speech, he announced setting up of two centres of excellence in agricultural research (Assam and Jharkhand), two agricultural universities (Andhra Pradesh, Rajasthan), two horticulture universities (Telangana and Haryana) and a dedicated “Kisan TV” for farmers.

“To accelerate setting up of a national market, the Central government will work closely with the State governments to re-orient their respective APMC Acts to provide for establishment of private market yards/private markets,” Jaitley declared, stating his government’s commitment to restructure the Food Corporation of India (FCI).

However, no time-frame was outlined for these two reforms in agricultural markets and foodgrain management. But, the announcement sought to address the challenge of small landholding and landless farmers before the farming sector of the country through “joint farming groups” and farmers’ “producers organisation” innovations.

For this purpose, Jaitley announced to “provide finance to 5 lakh joint farming groups of ‘Bhoomi Heen Kisan’ through NABARD in the current financial year” to meet the institutional finance requirement of landless farmers. Additionally, the Finance Minister announced to provide Rs 200 crore to NABARD for “building 2,000 producers organisations” in two years.

Expressing the government’s commitment for achieving four per cent agricultural growth target, the Minister pressed for “blue revolution” in fisheries and “protein revolution” in protein-rich farm items.

The Budget also proposed dedicated funds for meeting various demands of the sector with an outlay of Rs 100 crore for an “Agri-Tech Infrastructure Fund”, Rs 100 crore towards “National Adaptation Fund” for climate change, and Rs 500 crore towards “Price Stabilisation Fund” for shielding farmers against volatility in commodity prices.

In what could be a long-term investment for the farming sector, the Budget earmarked Rs 1,000 crore to launch “Pradhan Mantri Krishi Sinchayee Yojana” to enhance assured irrigation facility for the farmers along with Rs 100 crore to undertake a “mission mode” scheme to provide soil health card to each farmer. Rs 56 crore has been allocated for setting up 100 mobile soil testing labs.

The Budget continued its interest subvention scheme for timely loan repaying farmers, who will get farm loan at four per cent interest. It aims at providing Rs 8 lakh crore of farm loans to other farmers at seven per cent interest rate. The Centre also announced setting up a “Long Term Rural Credit Fund” in NABARD with a corpus of Rs 5,000 crore to provide “refinance support to Cooperative Banks and Regional Rural Banks”.

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