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In line with the expected thrust on the farm and rural sector, Finance Minister Arun Jaitley on Thursday announced that the Minimum Support Price (MSP) for notified kharif crops will be 1.5 times the input cost, and also stepped up total budgetary allocation for the sector for next fiscal by about five per cent.
Presenting the Union Budget for 2018-19, Jaitley said the government would spend more on agriculture, livelihood and infrastructure in the rural area and increased funds for crop insurance, rural roads, irrigation besides setting higher targets for farm credit.
With total budgetary outlay of Rs 2,01,933 crore for agriculture and rural development, the government has emphasized on development of food processing, dairy and fishery sectors to enhance farmers' income.
The budgetary outlay for the agriculture sector and rural development sector increased from Rs 56,589 crore and Rs 1,35,604 crore in 2017-18 to Rs 63,836 crore and Rs 1,38,097, respectively.
In order to address problem of smooth transport of perishable commodities, the Minister proposed to launch 'Operation Greens' with allocation of Rs 500 crore, in which Farmer Producers Organisations (FPO), agri-logistics, processing facilities and professional management will be promoted.
Jaitley also announced 'Re-structured National Bamboo Mission', liberalisation in agri-commodities export and free LPG connections to eight crore poor women under Ujjwala Scheme.
Favourable taxation treatment will be given to FPOs for helping farmers aggregate their needs of inputs, farm services, processing and sale operations, he added.
The biggest takeaway from the Budget, however, was the assured higher return for agriculture produce as the government moved to tackle distress in rural parts in the wake of the upcoming assembly elections in some major states this year.
"The government has decided to make the MSP for all notified crops in the coming kharif season at least 1.5 times of input cost. It will help in doubling farmers' income," said the Minister, adding a concrete mechanism would be devised to ensure higher farm income.
In a series of tweets, farmer activist and Swaraj India leader Yogendra Yadav said the government had changed the input cost calculation formula and so the farmers will be "dodged again".
The allocation to Market Intervention Scheme and Price Support Scheme was slashed to Rs 200 crore in 2018-19 from Rs 950 crore in 2017-18.
For the flagship crop insurance scheme Pradhan Mantri Fasal Bima Yojana (PMBFY), the Budget increased from Rs 10,698 crore (revised) in 2017-18 to Rs 13,014 crore in 2018-19 with an objective to bring 50 per cent of the gross cropped area under the insurance coverage.
Jaitley said the BJP-led NDA government had been steadily increasing the volume of institutional credit for agriculture sector -- from Rs 8.5 lakh crore in 2014-15 to Rs 10 lakh crore in 2017-18.
"I now propose to raise this to Rs 11 lakh crore for the year 2018-19," he said.
The budget also witnessed a hike in allocation of irrigation scheme Pradhan Mantri Krishi Sinchai Yojana (Per Drop More Crop) from Rs 3,000 crore in 2017-18 to Rs 4,000 crore in 2018-19.
This scheme aims to bring 16 lakh hectares additional area under micro-irrigation.
The allocation to the country's largest rural job assurance scheme -- Mahatma Gandhi National Rural Employment Guarantee Programme, known as MGNREGA, remained unchanged this year at Rs 55,000 crore.
The budget for Pradhan Mantri Gram Sadak Yojana was increased from Rs 16,900 crore in 2017-18 to Rs 19,000 crore but allocation for Pradhan Mantri Awas Yojana decreased to Rs 21,000 crore in coming fiscal fiscal from Rs 23,000 crore in the current fiscal.
Jaitley announced setting up of a Fisheries and Aquaculture Infrastructure Development Fund (FAIDF) for fisheries sector and an Animal Husbandry Infrastructure Development Fund (AHIDF) for financing infrastructure requirement of animal husbandry sector, with the total corpus of Rs 10,000 crore.