Opinion This Budget was blind to the farm and the farmer
Despite repeated warnings about climate risks and the need for technology-driven farming, the Department of Agricultural Research and Education has seen its allocation reduced to Rs 9,967 crore from Rs 10,281 crore last year
Agriculture is being edged out of fiscal priority Budget 2026-27 tells an uncomfortable story: The farm sector, which sustains livelihoods and food security, has quietly slipped from the centre of economic planning. Agriculture employs nearly 42 per cent of India’s workforce but contributes only about 16 per cent to GDP. This imbalance reflects stagnant productivity and a steady erosion of farm viability. The average size of operational landholdings has shrunk to 1.08 hectares, limiting economies of scale, mechanisation and income growth. While the overall economy accelerates above 7 per cent, agriculture is expected to grow at 3 per cent.
Of the estimated Rs 53.47 lakh crore total outlay, agriculture and allied sectors receive Rs 1.62 lakh crore, only marginally higher than last year’s Rs 1.58 lakh crore. The Ministry of Agriculture and Farmers’ Welfare now accounts for just 2.62 per cent of total Budget expenditure, down from 3.46 per cent in FY 2025-26 and 4.26 per cent in FY 2021-22. In relative terms, agriculture is steadily being edged out of fiscal priority.
Over four-fifths of the ministry’s budget goes to four schemes: PM-KISAN, PM Fasal Bima Yojana, the Interest Subvention Scheme for Kisan Credit Cards, and PM-AASHA. The combined allocation for these schemes has increased by just 0.2 per cent over last year’s revised estimates. PM-KISAN itself has been allocated Rs 63,500 crore, 15 per cent lower than the Rs 75,000 crore provided in 2019-20, despite a sharp rise in input costs. Concerned parliamentary committees have recommended indexing income support to inflation, but this advice is not reflected in the Budget. The much-publicised high-value agriculture scheme, limited to select crops such as coconut, cashew and cocoa, has been allotted a token Rs 350 crore. There is silence on the long-standing demand for a legal guarantee of MSPs. With only nominal MSP increases and declining cereal procurement, farmers are pushed further into market volatility.
The PM Dhan-Dhanya Krishi Yojana, unveiled in the 2025-26 Budget for 100 low-productivity districts with an outlay of Rs 24,000 crore, was formally launched in October 2025 and prominently featured in the Economic Survey. Yet, not a single rupee has been allocated. The Agriculture Infrastructure Fund of Rs 1 lakh crore, announced in 2020, has seen only Rs 66,310 crore sanctioned so far, with no fresh allocation this year. Input costs have also been ignored. The fertiliser subsidy has been cut to Rs 1.7 lakh crore, down from Rs 1.86 lakh crore, without any alternative strategy to address rising costs, soil degradation, or climate stress. There is little in the Budget to suggest a push towards self-sufficiency in oilseeds and pulses or to address climate-induced vulnerabilities.
The most worrying signal is the squeeze on agricultural research. Despite warnings about climate risks and the need for technology-driven farming, the Department of Agricultural Research and Education has seen its allocation reduced to Rs 9,967 crore from Rs 10,281 crore last year. India already spends less than 0.5 per cent of its agricultural GDP on R&D, well below the 1 per cent benchmark for sustained productivity growth. Cutting back on research now reflects short-term fiscal thinking at the cost of long-term resilience. There is neither structural reform nor a transformative vision. A country cannot aspire to developed-nation status by marginalising 42 per cent of its workforce.
The writer is LoP and former CM, Haryana. He headed the AICC Working Group on Agriculture Production
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