The government on Saturday proposed 11 per cent increase in the farm credit target to 15 lakh crore for 2020-21 and announced special rail and flight services for transportation of farm produce as its seeks to double farmers' income by 2022.The government also proposed promoting 'one product one district' for better marketing and export of horticulture crops. It also called on states for early implementation of three key central model laws on land leasing, agriculture produce and livestock marketing and contract farming.
Presenting the Budget, Finance Minister Nirmala Sitharaman said, "Our government is committed to the goal of doubling farmers' incomes by 2022." She further said that prosperity of farmers can be ensured by making farming competitive. "For this, farm markets need to be liberalised. Distortions in farm and livestock markets need to be removed."
Purchase of farm produce, logistics and agri-services need copious investments. Substantial support and hand-holding of farm-based activities such as livestock, apiary, and fisheries need to be provided for, she said. Barely two years left for achieving the target of doubling farmers income, the Finance Minister said farmers desire integrated solutions covering storage, financing, processing and marketing.
To improve marketing, Sitharaman said Indian Railways will set up a Kisan Rail - through public private partership (PPP) arrangements - to build a seamless national cold supply chain for perishables, inclusive of milk, meat and fish. There would be refrigerated coaches in Express and Freight trains as well.
Krishi Udaan will be launched by Civil Aviation Ministry to transport agri-products to national as well international destinations. This will immensely help improve value realisation especially in North-East and tribal districts, she added. To provide better access to bank credit, the government proposes raising the target for disbursing agriculture credit to Rs 15 lakh crore for the 2020-21 fiscal from the current target of Rs 13.5 lakh crore.
Normally, farm loans attract an interest rate of 9 per cent. But the government is providing 2 per cent interest subsidy to ensure farmers get short-term farm loan of up to Rs 3 lakh at an effective rate of 7 per cent per annum. The financing on Negotiable Warehousing Receipts has crossed more than Rs 6,000 crore. This will be integrated with electronic National Agriculture Market (eNAM), she added.
To further expand storage and warehousing facilities, the Finance Minister proposed creating warehousing, in line with Warehouse Development and Regulatory Authority (WDRA) norms.