Union Budget 2021: Agriculture Remains Crucial for Rural India, Here's What More Can be Done for

Union Budget 2021: Agriculture is the backbone of the regional economy of India. Major reforms in the agriculture sector have been initiated by the government of India. Continued efforts and strategies that involve technology-led development are needed to unlock the true potential of Indian agriculture. Only when the sector is made competitive and remunerative for farmers would long-term sustained development be possible.

Agricultural policies that support new-age technology would reduce farmers' production costs. At about 0.3 percent of agricultural GDP, research & development (R&D) spending in agriculture in India is minuscule. A large share of GDP should be spent in R&D to resolve the emerging problems of climate change, food security and nutritional security.

Furthermore, the need for an hour is an investment in technology that is efficient, user-friendly and personalized to suit the needs of medium and small farmers. In order to ensure technology-driven agricultural growth, the budget could promote investment in new-age technologies that boost agricultural economics by reducing production costs and waste in the pre- and post-harvest phases. The promotion of farm mechanisation technology to farmer rental models with a successful farmer would serve as a stimulus for increasing agricultural yield. Lending to smallholder farmers to rent to the BPL would increase the mechanization currently inaccessible for this marginal market. Precision technology will continue to generate more with lower inputs which will lead to lower consumption of agricultural oil, seeds, fertilizers and pesticides. 90% of the freshwater harvested in India is used for agricultural purposes.

In order to create a beneficial Agri start-up ecosystem, India needs an independent Agri Technology Regulatory Council. In order to minimize knowledge arbitrage on data for sowing, crop status, markets and other critical criteria, government should concentrate on reinforcing Agri statistics. Usage of Agri-stack based on a database of farmers will provide immediate access to innovative technologies at the doorstep of farmers. Fresh, creative consolidation models are imperative, provided that the cost per unit with limited land holdings is large and the volume of development is very small. FPOs play a significant role not only in building farmers' socio-economic resilience, but also in achieving multiple priorities for sustainable growth.

Introduction of scientific storage systems would also reinforce FPOs further. The full capacity of the storage facility and negotiable warehouse receipts in electronic form (e-NWR) is still unrealized. Strengthening the country's warehouse infrastructure would encourage farmers and FPOs to store their produce after harvesting and help avoid selling distress. In the future, the function of a warehouse will be more than mere storage. It is necessary to build new capabilities in Agri warehousing with technical features and creative functional measurements.

It was reassuring to notice the effort of the government to turn the crisis into an opportunity by taking a step towards the long-standing agricultural sector reforms. In the future, it would be beneficial to implement technologies at different levels of the chain and to create an Agri Council, in line with the GST Council, for an integrated approach between the Centre, the State and all concerned ministries.

The government is supposed to continue to demonstrate a firm commitment in the Union Budget 2021-22 to make Indian agriculture more competitive.

Credit: T R Kesavan, Chairman, FICCI National Agriculture Committee & Group (Corporate Relations & Alliances), TAFE Ltd. The viewpoints shared are those of the author's.