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Creating the Hardware and Software for Agriculture – An Article of Faith for the Modi Government

Doubling farmer income is a cornerstone of the Narendra Modi government’s outlook towards agriculture in India. Bearing this in mind, a close scrutiny of the varying policies across different sub-segments of this sector shows distinct policy paradigms emerging clearly. One such paradigm is the focus on spurring infrastructure for agriculture, and creating the ‘hardware’ and the ‘software’ necessary to enable farmer income growth in India’s agricultural system.

Building Infrastructure, Improving Farm Mechanization

Talk about infrastructure for farming often doesn’t bring to mind specifics for a large number of people. However, to the farmer, there is a major infrastructure requirement that was not met for long, till the Modi government stepped in with various initiatives in its first term. Micro irrigation with efficient technologies as an idea did exist; however, with the Modi government putting extra emphasis under the Pradhan Mantri Krishi Sinchai Yojana (PMKSY), its growth has been exemplary. A simple mantra like ‘more crop per drop’ very easily connected with India’s farmers, who realized that this was a way to make agriculture resilient and efficient, given the ongoing challenge of water shortage in today’s times.

The results of its ongoing progress clearly can be seen, when one notices the strong and steady increase in the area under micro irrigation. By 2019-20, the area covered thanks to the PMKSY crossed 44 lakh hectares with 8.4 being covered by micro irrigation in 2019-20 alone, reflecting the ongoing resonance of the PM’s message with India’s farmers.

Source: PM Krishi Sinchai Yojana

Irrigation is one part of the hardware development; the other part that has been given a major boost in recent times has been the mechanization part which plays a major role in enhancing productivity and reducing input costs.

Taking into consideration the above, to boost the farm mechanization in the country, a special dedicated scheme – the Sub Mission on Agricultural Mechanization (SMAM) – of the government has been providing subsidy for purchase of various types of Agricultural implements and machinery used. However, since everyone is not able to buy expensive and advanced farm machinery, the government has been aggressively pushing Custom Hiring Centres (CHC) through a SMAM scheme, thus also creating entrepreneurship at the rural level through rental of such machines. By listing these CHCs on the multi lingual Mobile App “CHC- Farm Machinery”, farmers can rent farm machinery and implements through CHCs in their area at a single touch. As on date, 49,027 CHCs with more than 1,45,839 CHC implements for hire have been set up, with a large number of the Centre owners primarily being farmers.

Source: Department of Agriculture, Government of India

The government has also been pushing hard to provide other kinds of infrastructure support. In its 16 Action Points for agriculture under Budget 2020, the Modi government has provided for the development of storage infrastructure and reduce wastage of food grains, thus improving the net income of farmers by creating warehouses through viability gap funding on a PPP mode at block level and a national cold supply chain for perishables, inclusive of milk, meat via Kisan Rail. The government has also worked to ensure that value realization improves for the North-East and tribal districts via Krishi Udaan launched by the Ministry of Civil Aviation. 

Credit Access and Insurance Protection – Pillars to Enable System Creation

Agricultural credit and farm insurance are important and often deliberated upon areas, and on this front the Modi government deserves all credit for leaving no stone unturned. With its Kisan Credit Card universalization initiative launched in February 2020, more farmers than ever can now obtain short term loan for crop & animal/fish rearing at a maximum interest of 4% on timely repayment. Also, the government remains committed to ensuring easier credit for farmers across India, having set a ₹15 lakh crore agricultural credit target in Budget 2020 as part of its 16 Action Points for agriculture. Easier access to credit is critical, since farming gives income post the sale of produce, making it a risky proposition and financial institutions can be loath to lend for such activities.

However, the government has not stopped itself here; it has been working hard to tweak the scheme further to respond to demands coming from various quarters. Option shall be given to States/UTs to choose Scale of Finance or district level Value of Notional Average Yield (NAY) as the sum insured for any district crop combination (Both PMFBY/RWBCIS). Also, farm gate price will be considered for the other crops for which MSP is not declared. Other important provisions include letting states provide specific single peril risk/insurance covers, like hailstorm etc. under PMFBY even with or without opting for base cover. Moreover, technology interventions and deployment of effective risk mitigation tools through crop insurance are now being actively pursued. With the new changes, farmers can manage risk in agriculture production in a better way and succeed in Stabilizing the farm income

By creating the necessary framework to generate both the hard component of agriculture as well as the soft component of agriculture, one clearly sees how NaMo 2.0 remains committed to pursuing the path for doubling farmers’ income in a wholesome and comprehensive manner. Addressing the various roadblocks over the past six years, the government marches onwards, mindful of the responsibilities it has to bear and the targets it has to achieve, taking everyone along. Sabka Saath, Sabka Vikas and Sabka Vishwaas is not merely a slogan – it is the soul of NaMo 2.0.

May 28, 2020