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Budget 2019: What lies ahead for Rural Economy and the Agricultural Sector

Yogesh Gadhave

Mumbai: As was widely expected, government did touch upon the nerve for revival of Rural income and Agricultural sector. The slowdown in Agricultural Economy has been evident over the past few months now and the distress has crossed the more than expected threshold.

Following are the key announcements the Government made aiming primarily towards the revival of the Rural economy and what it missed:

1. Structured Income Support Scheme-

The Government announced an income scheme for small and marginal farmer families. It is expected to benefit around 12 crore families. The same shall be routed through a newly announced Pradhan Mantri Kisan Scheme fund. Under the scheme, the families shall be paid by way of direct transfer a sum of Rs. 6,000 per year in 3 installments.

Thankfully, the initial estimate of Rs 1 Trillion to be spent on farm package was not announced, thus saving the Economy from a big fiscal deficit. The Finance Minister while announcing pegged at the fiscal deficit of 3.4% and claimed that had the enhanced the farm package not been announced, the fiscal deficit target was well within reach.

For the scheme an outlay of Rs 75,000 crores shall be borne by the Central Government alone for FY 2019-20. Also, Rs 20,000 crores has been alloted in revised estimates for current year (2018-19).

2. MNREGA Scheme alloted Rs 60,000 Crore Rupees-

The flagship rural employment scheme has been pivotal in generating rural employment and income. Allocation for the scheme enhanced by Rs 5,000 Crores taking it to Rs 60,000 crore for the year. Rural disposable income may be lifted thereby creating a movement in spendings. 

3. Fisheries Department set up-

With the announcement of Fisheries Department, a sustainable allied income and employment source is expected from the activity. Also, this may become an advanced export sector for the country and the same needs to be looked at seriously. India being a peninsular country, there is huge untapped potential for the nation.

Interest subvention scheme benefit of 2% extended to farmers persuing fisheries as an allied activity.

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4. Cold Chain Facilities-

The government acknowledged the importance of Cold Chain facilities in order to avoid agricultural slippages and supplement the packaging and storage. With the development of ports, cargo handling and terminal connectivity, Cold Storage may become the backbone of the economy not mere at national level but globally.

5. Missed Announcements-

The budget failed to mention any allocation towards the PM Sampada Yojana and also towards the eNAM being a link for national agricultural markets. Perhaps this may be looked at in the Full budget expected in the middle of the year post elections.

Overall the budget seemed to be fiscally prudent one with not much to burden the economy for.