Union Budget 2022: Tech push for agri sector

The Budget unveiled several steps aimed at boosting farmers’ income and improving the viability of agriculture as a remunerative economic activity, including prospective launch of special funds for agri start-ups, use of ‘kisan drones’ and launch of a public private partnership (PPP) model to spur agri-tech players and other stakeholders in the agriculture value chain. The idea is to deliver digital and hi-tech services to farmers, which would enable them to cut costs, find new markets and gain competitiveness in the global markets.

The ministry of agriculture and farmers welfare has recently provided for grants up to 100% of the cost of agriculture drones priced up to Rs 10 lakh to research institutes, Krishi Vigyan Kendras and State Agriculture Universities taking up demonstration at farmers’ fields while Farmer Producer Organisation (FPOs) are eligible to receive a grant of up to 75% of cost of drones. These ‘kisan drones’ will be used for crop assessment, digitisation of land records, spraying of insecticides and nutrients.

For financing start-ups for agriculture and rural enterprise relevant for farm produce value chain, the government will announce a fund with blended capital raised under the co-investment model through Nabard. The activities eligible for funds include start-ups which support FPOs, provide machinery for farmers on rental basis at farm level, and technology including IT-based support.

To reduce import dependence, the Budget has also proposed formulation of a comprehensive scheme for boosting domestic production of oilseeds.

In 2020-21, India imported 13.35 million tonne (MT) of edible oil out of total domestic consumption of around 22 mt. “This should go a long way in helping reduce our dependence on edible oil imports which are likely to be around Rs 1.5 lakh crore during the current year,” Atul Chaturvedi, president, Solvent Extractors’ Association of India, said.

In a boost to production and exports of nutri-cereals like millet, the Budget has announced assistance for post-harvest value addition and branding of millet products in the domestic as well as global markets. The Budget also proposed promotion of chemical-free natural farming also referred to as zero budget natural farming (ZBNF) on farmers’ lands in 5-km wide corridors along river Ganga, at the first stage.

In her Budget speeches for 2019-20 and 2020-21, finance minister Nirmala Sitharaman referred to ZBNF as ‘innovative model for doubling farmers’ income’. The Budget says the states will be encouraged to revise syllabi of agricultural universities to meet the needs of ZBNF and organic farming, modern-day agriculture, value addition and management.

While there is strident demand from farmer community for legal support to minimum support prices (MSPs), Sitharaman stated that government agencies purchased more than 120 MT of paddy and wheat in 2021-22 season from 163 lakh farmers and Rs 2.37 lakh crore has been paid to farmers as MSP for the two cereals.

The Budget has made around 28% less provision for food subsidy allocation of Rs 2.06 lakh crore in 2022-23 against the revised estimates of Rs 2.86 lakh crore in 2021-22. This is because Pradhan Mantri Garib Kalyan Anna Yojana will be valid only till March 31 2022.

The Budget also made provision of fertiliser subsidy of Rs 1.05 lakh crore for 2022-23, against Rs 1.4 lakh crore (RE) in 2021-22. An outlay of Rs 68,000 crore has been provided under the PM-Kisan income support scheme (BE) for farmers for 2022-23 compared with Rs 67,500 crore (revised estimate) for 2021-22.