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There is a lot for agriculture in the budget. The problem, if at all, is that expectations were higher.

There is a lot for agriculture in the budget. The problem, if at all, is that expectations were higher. To begin with, the Economic Survey, superbly crafted by Arvind Virmani in a framework of macro theory and policy rule structures, raised expectations for agriculture also. As these columns have always argued, a lot of the salvation for agriculture lies outside the sector and in that sense both the Survey8217;s agriculture chapter and the budget followed the time honoured path, including that red rag to the economist, the loan waiver.

The fact that India is urbanising faster than we think, diversified food patterns reach an inflection point of explosive growth when we reach our per capita income levels in PPP terms US 3000, globalisation is both threat and opportunity and that the new technologies in Bt, water saving and processing all have explosive growth potential, escape the attention they need in building an alternative framework. The reduction in direct and indirect taxes would increase the demand for high value agriculture products. The new look Survey tantalises with its state of the art discussion of macro relations, policy possibilities and threats. The opportunities this opens up for better policy are only dimly realised by the media at present.

The Survey says consumption patterns are changing. It notes that the agricultural work force is 52 per cent, not 60 or 70 as popularly believed. In fact, this also includes a share of six per cent for dairy and poultry, and so crop production is 45 per cent or so. It talks of great opportunities in rural power if we franchise the power tower, education, training, rural health and so on. If the links with the rest of the economy are capitalised, the sector can move much faster. In some sense, a lot of this is there in the budget. Those who have the vision will put it all together. But this is a continental country and we need it all to happen as a matter of course.

The more interesting aspects of the budget are the steps outside the crop production sector, where, in fact, the loan waiver could at least have been differently designed. The emphasis on water is well taken, as in the doubling of outlays in the Accelerated Irrigation Benefits Programme AIBP, the National Irrigation Projects the Irrigation Water Resources Finance Corporation and the management and repair of water bodies. The Eleventh Plan details a new-look watershed programme, with explicit rules of community-based organisations, facilitating agencies, a revamped organisational structure of accountability for rainfed regions and the budget provides for it. This emerged from the working group we chaired for rainfed regions, but the watershed plus part of value-added processing is not there. The farmer demands higher incomes now and the old-style programme has to be redesigned in watershed plus to meet those needs. Also, we had suggested a special programme for 100 distressed ground water districts, which introduced a component in which a farmer can introduce recharging steps in his private field also, since aquifers don8217;t respect property lines but go by geophysical characteristics. The FM had announced this last year but I am told it is in a bureaucratic stranglehold. I wish we had heard something operational on the agro climatic requirement in the thousands of crores of the Rashtriya Krushi Vikas Yojana, for otherwise that money can go down the drain.

Frankly speaking, the more interesting ideas for agriculture in the budget are in the education, health and social security programme. The Rs 30,000 insurance scheme for unorganised workers, many in the agricultural sector, the 24215;7 primary health centres, the schools and colleges in rural areas, particularly for poor children and girls, have great possibilities. Also, the knowledge networks, if scaled to village needs and implemented in a manner that the villages can maintain them, with models already available, and the Navyodaya Schools, a Rajiv Gandhi idea sadly given up later, can all play a role. I also believe that the world class mission mode skill development corporation to realise the demographic dividend and the moneys for cluster development, can be integrated with a vision of diversified rural development in which alone Indian agriculture will prosper.

The FM did well to announce that the fertiliser pricing reform will not let consumption go down. The blow of the loan mela was coming, but it would have been softened if the financing of the waiver was known for, after all, the banker is an economic animal and the last time around it took nine years to repay his losses and in the meantime he starved the farmer of credit. The FM says it won8217;t happen, but so did his predecessors. We have an innovative scheme for this but that is another article.

The writer is a former Union minister for power, planning and science, and was vice-chancellor of JNU alaghicenet.net