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Sitharaman announces steps to boost farm sector, including Rs 1 lakh crore Agri Infrastructure Fund
New Delhi, May 15, 2020
Union Finance Minister Nirmala Sitharaman today announced a slew of measures to give a boost to the farm sector, including a Rs 1 lakh crore Agri Infrastructure Fund along with schemes for micro-food enterprises, fisheries, animal husbandry and horticulture, among others.
Addressing a press conference here to unveil the third set of measures that are part of the mega Rs 20 lakh crore special economic package that Prime Minister Narendra Modi announced to revive the COVID-hit economy and build a self-reliant India, Sitharaman said that, apart from fiscal measures, the Government would also carry out regulatory reforms.
These would include amendments to the Essential Commodities Act and the APMC Act, she said.
Sitharaman said the lack of adequate cold chain and post-harvest management infrastructure in the vicinityof the farm gate was causing gaps in the value chain. She said the focus had been on short-term crop loans while not enough thought had been given to investment in long-term agriculture infrastructure.
She said a financing facility of Rs 1 lakh crore would be provided for funding agriculture infrastructure projects at farm-gate and aggregation points such as Primary Agricultural Cooperative Societies, Farmers Producer Organisations, Agriculture entrepreneurs, Startups, and so on.
She said the fund would be created immediately and it is expected to give an impetus for development of farm-gate & aggregation point, affordable and financially viable post-Harvest Management infrastructure.
Giving out details of the Rs 10,000-crore scheme for formalisation of Micro Food Enterprises (MFEs), Sitharaman said it would promote the Prime Minister's vision of "Vocal for Local with Global Outreach".
Pointing out that unorganised MFEs units need technical upgradation to attain FSSAI food standards, build brands and marketing, she said a scheme would be launched to help 2 lakh MFEs attain such goals. The scheme will support existing micro food enterprises, Farmer Producer Organisations, Self Help Groups and Cooperatives.
It will have a cluster-based approach, such as mango in Uttar Pradesh, kesar in Jammu & Kashmir, bamboo shoots in the North-East, chilli in Andhra Pradesh and tapioca in Tamil Nadu.
The scheme is expected to lead to improved health and safety standards, integration with retail markets and improved incomes. It is also expected to help in reaching untapped export markets in view of improved health consciousness.
Sitharaman also unveiled the Rs 20,000 crore Pradhan Mantri Matsya Sampada Yojana (PMMSY), that is expected to fill critical gaps in the fisheries value chain through integrated, sustained inclusive development of marine and inland fisheries.
This would include Rs 11,000 crore for activities in marine and inland fisheries and aquaculture and Rs 9,000 crore for infrastructure such as fishing harbours, cold chain and markets.
She said cage culture, seaweed farming, ornamental fisheries as well as new fishing vessels, traceability and laboratory networks would some of the key activities under the scheme.
It will have provisions of Ban Period Support for fishermen (during the period when fishing is not permitted), personal and boat insurance.
The scheme is expected to lead to additional fish production of 70 lakh tonnes over five years, generate employment for more than 55 lakh persons and double exports to Rs 100,000 crore. It will focus on islands, Himalayan states, the North-east and the Aspirational Districts, she said.
Sitharaman also announced a Rs 15,000-crore Animal Husbandry Infrastructure Development Fund.
Stating that there are many areas in the country with high milk production having great potential for private investment in dairies.
The fund is aimed at supporting private investment in Dairy Processing, value addition and cattle feed infrastructure. Incentives will be given for establishing plants for export of niche products.
Among other things, she said 10,00,000 hectares of land would be covered under herbal cultivation in the next two years with an outlay of Rs 4,000 crore.
She said this would lead to Rs. 5,000 crore income generation for farmers. There will be a network of regional "mandis" for medicinal plants. The National Medicinal Plants Board (NMPB) will bring 800 hectares under a corridor of medicinal plants along the banks of the Ganga.
Sitharaman outlined a Rs 500 crore scheme for development of infrastructure for beekeeping, which is a livelihood supporting activity in rural areas. The scheme will take up infrastructure development related to Integrated Beekeeping Development Centres, collection, marketing and storage centres, post-harvest and value addition facilities, and so on.
"This will lead to increase in income for 2 lakh beekeepers and quality honey to consumers," she said.
The Minister said Operation Greens would be extended from Tomatoes, Onions and Potatoes (TOP) to all fruits and vegetables (TOTAL). The Rs 500 crore scheme would include 50% subsidy on transportation from surplus to deficient markets and 50% subsidy on storage, including cold storages.
There will be a pilot for six months, which will be later expanded and extended. The scheme is expected to lead to better price realisation for farmers, reduced wastages and affordability of products for consumers.
Sitharaman said the Government would amend the Essential Commodities Act, 1955s, which was enacted in days of scarcity to enable better price realsiation for farmers by attraccting investments and making the agriculture sector competitive.
She said agriculture foodstuffs including cereals, edible oils, oilseeds, pulses, onions and potato will be deregulated. Stock limits will be imposed under very exceptional circumstances like national calamities, famine with surge in prices, and so on. No such stock limit shall apply to processors or value chain participant, subject to their installed capacity or to any exporter subject to the export demand.
Similarly, there will be Agriculture Marketing Reforms to provide marketing choices to farmers.
At present, farmers are bound to sell agriculture produce only to licensees in APMCs. Such restriction of sale is not there for any industrial produce and it results in hindrances in free flow of agricultural produce and fragmentation of markets and supply chain, along with less price realisation for farmers, she said.
She said a Central law would be formualted to provide adequate choices to farmers to sell produce at attractive price, barrier-free inter-state trade and framework for e-trading of agriculture produce.
She also outlined steps for agriculture produce price and quality assurance.