This was the first full budget (2025–26) of Prime Minister Narendra Modi's third term and the opportunity for the government to set a long-term policy direction for the farmers, who are included in the priority categories including women, youth and the poor. Finance Minister Nirmala Sitharaman started by saying that agriculture is the first among the four engines of economy for a developed India. But instead of laying out a long-term policy initiative for agriculture in the budget, her decisions were limited to missions only. She presented a list of several missions for the agriculture sector with provisions ranging from Rs. 100 crore to Rs. 1000 crore in the budget.

Now, what do these missions and the rest of the budget provisions mean for farmers and agriculture, and will it really bring any big change in their lives is a big question. Presenting the Union Budget, Finance Minister Sitharaman, laid special emphasis on the GYAN - Garib, Yuva, Annadaata (farmers) and Nari - and gave priority to 10 major areas including agricultural growth, increasing productivity and rural prosperity.

In the expenditure of major items, the budget for agriculture and allied activities has been increased from the revised estimate of Rs. 1,40,859 crore to Rs. 1,71,437 crore for 2024–25. However, the allocation for the Ministry of Agriculture and Farmers Welfare has been reduced by Rs. 3595 crore from the revised estimate of Rs. 1,41,351 crore to Rs. 1,37,756 crore. Similarly, the budget of the Department of Agriculture and Farmers Welfare has been reduced from the revised estimate of Rs. 1,31,195 crore to Rs. 1,27,290 crore.

The budget of the Department of Agricultural Research and Education (DARE) has been increased by only Rs. 310 crore from the revised estimate of Rs. 10,156 crore to Rs 10,466 crore. Though the finance minister described agriculture as the engine of the Indian economy, she has been stingy in fuelling this engine. The budget of many schemes, including the Prime Minister Crop Insurance Scheme and fertilizer subsidy, has also seen a cut. However, the finance minister announced many new schemes and missions, emphasizing on increasing agricultural productivity.

The government has increased the loan limit on Kisan Credit Card (KCC) from Rs. 3 lakh to Rs. 5 lakh. About 7.7 crore farmers, fishermen and dairy farmers covered under KCC will benefit. Through KCC, loans are available at a concessional interest rate of 7 percent per annum. Those who repay the loan on time also get a 3 percent interest discount. In this way, it becomes possible for farmers to get loans at an interest rate of 4 percent. But despite increasing the limit of KCC, the provision of interest waiver is at the same level as last year.

Reaching Out to 1.7 crore Farmers

She also announced the 'Pradhan Mantri Dhan-Dhanya Krishi Yojana' on the lines of the Aspirational Districts Programme. Under this scheme, 100 districts with low yield and productivity will be included with the participation of states. In these districts, the target is to increase agricultural production, adopt crop diversity and sustainable agricultural practices, storage at panchayat and block levels, improve irrigation facilities and increase loan availability. The finance minister said the scheme is likely to help 1.7 crore farmers.

A comprehensive multi-sectoral 'Rural Prosperity and Adaptation' programme will be started with the participation of states for rural prosperity. This will promote employment through skill, investment and technology, so that forced migration from rural areas can be stopped. In the first phase of the programme, 100 developing agricultural districts will be included and the focus will be on rural women, youth, small farmers and landless families.

Many Missions Together

This time also, the finance minister has emphasized on bringing self-sufficiency in edible oils and pulses. However, the expected results have not been seen in this direction yet. Now, the central government is going to start a 6-year "Pulses Self-Reliance Mission" with a special focus on tur, urad and lentils. Central agencies like NAFED and NCCF will buy a maximum of these pulses from the farmers. A budget of Rs. 1000 crore has been set aside for the Pulses Mission.

A comprehensive programme for fruits and vegetables has also been announced in the budget. This programme will be run with the participation of states to provide for production, supply and processing, and remunerative prices to farmers for vegetables and fruits. Participation of farmer producer organizations (FPOs) and cooperatives will be ensured for the scheme. A budget of Rs. 500 crore has been allocated for the Fruit and Vegetable Mission.

To bring self-sufficiency in urea production, the government will set up a urea plant with an annual production capacity of 12.7 lakh metric tonnes in Namrup, Assam. The resumption of three idle urea plants in eastern India will help increase urea supply.

In view of the potential of the fisheries sector, the government will promote deep-sea fisheries in Andaman and Nicobar and Lakshadweep. In her budget speech, the finance minister said India Post, with a huge network of 1.5 lakh rural post offices and 2.4 lakh postal workers, will be prepared to boost the rural economy. There is a preparation to transform India Post into a public logistics organization.

Among the major central schemes related to agriculture, the budget of the National Agricultural Development Scheme has been increased from the revised estimate of Rs. 6000 crore to Rs. 8500 crore. The National Natural Farming Mission, launched to promote natural farming, was allocated Rs. 365 crore in the last budget, which was reduced to Rs. 100 crore in the revised estimate. This year a budget of Rs. 616 crore has been earmarked for the National Natural Farming Mission. Under this mission, the target is to connect 1 crore farmers with natural farming.

The provision of Rs. 63,500 crore has been retained for the PM Kisan Samman Yojana. There is a provision of only Rs. 120 crore for the PM Mandhan Yojana, which gives pension to farmers, which was Rs. 100 crore in the last budget. There is a provision of Rs. 584.60 crore for the scheme to create 10,000 FPOs, which is almost equal to last year. A provision of Rs. 75 crore has been made for beekeeping and Rs. 71.50 crore for agri start-ups.

Govt slashed crop insurance scheme budget

The budget of the crop insurance scheme launched to protect farmers from natural risks has been reduced from the revised estimate of Rs. 15,864 crore to Rs. 12,242 crore. This is a big cut in the budget allocation for the crop insurance scheme. A provision of Rs. 6945.36 crore has been made for the PM-Asha scheme launched to protect farmers from market fluctuations, which was Rs. 6437 crore in the last budget. Considering the various crops being sold below the minimum support price (MSP) across the country, this increase of about Rs. 500 crore in the budget of PM-Asha also seems insufficient.

However, no provision has been made for the distribution of pulses under welfare schemes in states. The PM-Kisan scheme has been given a budget of Rs. 63,500 crore, equal to the revised estimate of the current financial year. The budget of the Agriculture Infrastructure Fund (AIF), which promotes the creation of infrastructure in agriculture sector, has been increased from the revised estimate of Rs. 750 crore to Rs. 900 crore.

Emphasis on Dairy and Food Processing

The budget of the Department of Animal Husbandry and Dairying was fixed at Rs. 4521 crore for the current financial year 2024–25, which was reduced to Rs. 3839 crore in the revised estimate. In the budget for the year 2025–26, a provision of Rs. 4840 crore has been made for the department, which is a significant increase over the last year. The budget of the Fisheries Department has been more than doubled from Rs. 1666 crore to Rs. 2703 crore. The biggest increase in this has been in the allocation for Pradhan Mantri Matsya Sampada Yojana, which has been increased from Rs. 1500 crore to Rs. 2465 crore.

The budget of the Ministry of Food Processing has been increased from the revised estimate of Rs. 2796 crore to Rs. 4364 crore. The allocation for the Production Linked Incentive Scheme for the food processing industry has been increased from Rs. 700 crore to Rs. 1200 crore. The budget of Pradhan Mantri Kisan Sampada Yojana of the same ministry has been increased from Rs. 630 crore to Rs. 903 crore. The budget of PM-FME, a scheme to promote small food enterprises, has increased from Rs. 1200 crore to Rs. 2000.

Fertilizer subsidy policy unchanged

No significant change has been made in the subsidy policy on fertilizers. The subsidy for urea has been kept almost the same as the last year at Rs. 1,18,899 crore and the Nutrient Based Subsidy (NBS) on NPK fertilizers has been reduced from Rs. 52,310 crore to Rs. 49,000 crore. Considering the demand and supply situation of DAP fertilizers in the country, there was a need to increase the nutrient-based subsidy, but a cut of Rs. 3310 crore has been made compared to the revised estimate of the current financial year.

The fertilizer subsidy has been fixed at Rs. 1,67,887 crore as against the revised estimate of Rs. 1,71,298 crore. Allocation for the scheme to promote organic fertilizers has been increased from Rs. 45 crore to Rs. 150 crore.

The central government has reduced the food subsidy budget slightly from the last budget estimate of Rs. 2,05,250 crore to Rs. 2,03,420 crore, while it has increased the MSP on wheat and paddy. Due to this, the expenditure on food subsidy is expected to increase. It is worth noting that in the year 2023–24, the central government had spent Rs. 2,11,814 crore on food subsidy.

This budget, which gives special emphasis on rural prosperity, has a provision of Rs. 1,90,405 crore for the Ministry of Rural Development, which is about Rs. 10,000 crore more than the last year. The budget of the Department of Rural Development has increased from Rs. 1,77,566 crore to Rs. 1,87,754 crore. However, there has been no budgetary increase for the MNREGA, the main scheme related to rural development, and it has been kept at Rs. 86,000 crore, equal to the last year.

The budget of Pradhan Mantri Gram Sadak Yojana has been increased from Rs. 12,100 to Rs. 16,600 crore. An increase in the budget of the National Rural Livelihood Mission from Rs. 1507 crore to Rs. 19,005 crore and the budget of Pradhan Mantri Awas Yojana Gramin from a revised estimate of Rs. 32,426 crore to Rs. 54,831 crore reflects the priority of the government towards rural development.