Ashok Gulati, Raya Das on Budget 2025: Stopping short of the farm

So, the existent question is whether the allocation is capable to tackle immoderate of the structural problems of agriculture. While agriculture’s stock successful wide GDP has been declining implicit the decades, reaching astir 17.7 per cent successful caller years, its stock successful the workforce, aft a secular decline, reversed, and it accrued from 42.5 per cent successful 2018-19 to 46.1 per cent successful FY24. This has depressed the existent wages successful the farming sector, wherever 55 per cent of employment is of workplace labourers, who are astatine the bottommost of the economical pyramid. This reverse inclination underscores the inability of non-agricultural sectors successful municipality India to sorb this surplus labour. The Economic Survey has rightly pointed retired the request to beforehand labour-intensive sectors with accomplishment upgradation truthful that their productivity, and thus, their incomes, improve. The organised manufacturing assemblage truthful acold has gone successful for much capital-intensive choices alternatively than labour-intensive ones. Deregulating MSMEs is 1 mode to determination guardant arsenic they make a bulk of employment successful the country, aft agriculture.

The budget’s accent connected releasing 109 high-yielding, climate-resilient varieties of 32 tract and horticulture crops is welcome. However, without capable concern successful R&D and extension, productivity gains whitethorn not construe into higher workplace incomes. There is lone a marginal summation successful expenditure connected R&D successful the FY26 fund implicit the revised estimation of FY25. This is mode beneath the 1 per cent people of agri-GDP, considered indispensable to guarantee sustainable agriculture maturation successful the look of clime change. India is hovering astatine little than 0.5 per cent.

Marketing of high-value crops remains a challenge, fixed the fragmented worth concatenation that results successful farmers receiving lone astir 30 per cent stock successful the consumer’s spending connected fruits and vegetables. The Mission for Vegetables and Fruits, with a Rs 500 crore allocation this year, aims to heighten production, fortify proviso chains, and boost processing to guarantee farmers person remunerative prices. This has imaginable if efficaciously implemented. But the allocation is simply a paltry sum portion the request is huge. What is needed is focused attraction connected fruits and vegetables, arsenic was fixed to beverage nether Operation Flood. The existent programmes and allocations deficiency that vision, and hence, the problems volition linger. Strengthening e-NAM and integrating it with the ONDC level could amended terms discovery, trim middlemen inefficiencies, and springiness farmers amended marketplace access. However, logistical bottlenecks and inadequate processing facilities proceed to bounds this potential.

Agriculture’s challenges are profoundly intertwined with planetary terms dynamics. India continues to look shortages successful pulses, oilseeds, and cardinal earthy materials for agri-processing industries similar fabric and maize, starring to rising import dependence. The fund does small to code these shortages structurally. Expanding the country nether pulses successful rice-fallow regions and incentivising private-sector information successful oilseed accumulation could assistance span this gap. But the structural situation remains: Farming successful India is inactive heavy babelike connected atom and wheat, mostly owed to MSP-centric procurement policies that assemblage retired high-value crops similar pulses, oilseeds and horticulture. The displacement to a crop-neutral inducement operation is imperative to thrust sustainable diversification.

Post-harvest losses stay a important issue. Around 8.1 per cent of fruits and 7.3 per cent of vegetables are mislaid successful the post-harvest worth chain, amounting to 37 per cent of full post-harvest losses of Rs 1.53 trillion annually. Higher investments successful acold chains, processing facilities, and logistics are needed to trim specified losses. Despite efforts to grow warehousing and acold retention infrastructure nether assorted schemes, a important information of perishable nutrient is wasted owed to inadequate processing capacity. The authorities has taken steps to promote backstage concern successful retention and selling infrastructure, but much needs to beryllium done. The allocation nether the Agriculture Infrastructure Fund has accrued from Rs 600 crore successful FY25 to Rs 900 crore successful FY26, which tin amended the post-harvest worth concatenation successful India.

While the Union Budget 2025-26 makes immoderate advancement successful addressing cultivation challenges, the wide attack remains incremental alternatively than transformational. A paradigm displacement is needed — 1 that moves distant from subsidy-heavy interventions towards investment-driven growth, greater backstage assemblage participation, and technology-led ratio improvements. The way to making Indian agriculture much resilient and globally competitory requires bold reforms successful subsidy rationalisation, infrastructure development, and marketplace linkages. Only past tin India execute the extremity of Vikshit Bharat and presumption itself arsenic an cultivation powerhouse by 2047.

Gulati is Distinguished Professor and Das a probe chap astatine ICRIER. Views are personal