Budget 2020-21: Nirmala Sitharaman's first budget of the decade has given a solar push to the agriculture sector, however, execution will again become the key factor here. To boost generation and use of power, the government has expanded the 'PM Kusum Scheme' to 20 lakh farmers to set up grid-connected solar farms on barren lands making 'Annadata to Urjadata'. "However, a scheme to install solar pumps at such a large scale will also have to take care of water table depletion as exploitation can be a major hurdle," Chaudhary Pushpendra Singh, President, Kisan Shakti Sangh, told Financial Express Online.
If the pumps run on diesel, it is used in a more mindful manner, but the wide and free availability of solar energy can increase its misuse, he added. With the new government's scheme, the farmers around barren lands are likely to get a new way of making a living.
"The setting up of grid-connected solar farms on barren lands would reduce the dependence on thermal and other non-renewable resources. Further, the setting up of large solar-powered capacity alongside rail tracks is in line with the idea of Green India," Gagan Vermani, Founder & CEO, MYSUN. The FM did leave a grey area when it comes to custom duties on imports and it will be a game of wait and watch there, he added.
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However, many industry experts also believe that the government's new move can transform the agriculture sector forever as it will give a major source of earning to the farmer families. "The push to solar power (PM Kusum Scheme) in the agriculture sector is positive and builds on what has been started earlier," Naveen Aggarwal, Partner, Tax, KPMG in India. This will bring continuity and consistency in this program and can be transformational to the agriculture sector over the years, he added.
Meanwhile, one of the major reasons behind low agricultural activity is the fragmentation of land holding in many states which has resulted in limited purchasing power of individual farmers. The focus on farmer producer organizations (FPOs) could help address this issue as it would enable farmers to leverage their combined financial strengths to purchase or hire agri-mechanization equipment, said Arindam Guha, Partner, Deloitte India.