Atmanirbhar farm schemes may get boost in Budget amid farmers' protest

There could be a road map for further reform in the farm sector, particularly on the input side, say sources

Amid the ongoing farmers’ protests, the forthcoming Union Budget is expe­cted to allocate resources for items rel­ated to agriculture and the rural sector under the Atmanirbhar Bharat package, including funds for creating farmgate-level storage infrastructure and flagship schemes such as the Mahatma Gandhi National Rural Employment Gua­rantee Act (MGNREGA).

Government sources said in terms of new schemes and announcements, there could be a road map for further reform in the farm sector, particularly on the input side.

The Rs 1-trillion Agriculture Infras­tructure Fund (AIF), announced as part of the Atmanirbhar Bharat package, along with the financing facility created by the National Bank for Agriculture and Rural Development, could get special attention for funding infrastructure projects like cold storage, warehouses, and yards at the farm-gate and aggregation points.

To address the concern about dismantling agriculture produce marketing committees (APMCs) once the farm reforms kicked in, sources said the Budget might allocate extra funds for completing the gramin agriculture markets (GrAMs) scheme, anno­unced in the 2018-19 Budget. 

Under this, the Centre had planned to develop and upgrade the existing 22,000 rural haats into GrAMs, in which physical infra will be strengthened using the MGNREGA and other schemes.

It had also announced setting up an Agri-Market Infrastructure Fund with a corpus of Rs 2,000 crore for the 22,000 GrAMs and 585 APMCs.

In the case of the MGNREGA, the programme, which has been the backbone of rural recovery during the Covid-induced lockdowns and has seen a record number of rural households getting employed this year, could see its FY22 allocation retained at around Rs 1 trillion.

During the pandemic, the Centre had enhanced allocation under the scheme by Rs 40,000 crore, taking the total to over Rs 1 trillion for FY21 due to surge in demand from migrants. So far, around 70 million households have received work under the scheme — highest since its inception about 15 years ago.

In December, around 26.34 million people demanded work under the MGNREGA, which was 113.13 per cent more than in the same period last year, and around 16 per cent more than in November. 

Till the end of December, the MGNREGA website showed that around 80 per cent of the budget for FY21, worth Rs 1.01 trillion, had been spent, while demand continues unabated, leading to a gap of around Rs 5,700 crore between the funds available and those spent. Several states show a negative balance.

“Agriculture has done well this year, but rural incomes haven’t grown at the same rate. The big challenge before the Centre will be to ensure that rural incomes also grow, which can be done by adequately funding schemes such as the MGNREGA and also raising public investment in farming for creating of post-harvest facilities, etc,” Mahendra Dev, director of the Indira Gandhi Institute of Development Research, told Business Standard. He said the AIF needed to be fast-tracked, while there was need to develop local mandi infrastructure.