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Government should adopt policies in Budget 2021-22

The Union government has done very well in setting up of online trading platform such as e-NAM, which has helped the farmer to connect with his wholesaler and customers online for his regular produce. We need more such reforms.

Photo Credit : Reuters


Agriculture is the backbone of Indian economy, yet, the farmers of the country are awaiting their due recognition. It is time for the government to treat agriculture as a ‘Business’ and come out with policies that would make farmers real ‘Businessmen.’ Farmer friends should also accept the fact that they need to move with the changing times. The recent farmer agitation has shown that a section of farmers are against innovation. However, that occupies only a minor chunk with the majority open for change. The government should continue with agriculture reforms.   

At the turn of the pandemic days, in the new digital India, government needs to create an agri-business infrastructure or model that would give the overall support to the farmer right from sowing to selling their produce in the market. To this effect, a farmer requires technology to improve quality and yield of the produce; warehouses near his village for storage, sell when he wants, reduce wastage and get high returns; good insurance support; better transport amenities to fetch his produce to the market; better access to co-ordinate with government departments; export access etc.  The government can facilitate this with its efforts as well as encourage and facilitate start-ups to connect with the farmers. There are start-ups in the areas including distribution of farm produce, mechanized services, product testing &research, warehousing, agri-inputs, advisory and data, and many others.   

 Starting with this budget, in the next five years or so, the government should aim at creating warehouses in every Taluka of the country to stock the farmers’ produce. A good storage facility itself will solve most of a famer’s woes. In the previous Budget, the Finance Minister had announced the the agri-warehousing and cold storage sector, tying it up with WDRA for warehouse receipts, which can really help the farmers realise somewhat better prices by providing holding capacity for the farmers in local areas. This has to be extended on a large-scale basis.   

The government needs to encourage more Farming-as-a-service (FaaS)-based models. Simple models already exist like ‘Tractor on service’ and ‘Irrigation Technology on service’. With the ongoing tech and telecom revolution more start-ups would come up with more new-gen FaaS services.  The government should work with start-ups to make the services available to farmers at low cost. The start-ups will also get benefit from the economies of scale. As the majority of the farmers in the country own less than two acres of land, they cannot afford to buy new technology, a tractor or micro or drip irrigation. However, they can definitely acquire it on rent.   

The Union government has done very well in setting up of online trading platform such as e-NAM, which has helped the farmer to connect with his wholesaler and customers online for his regular produce. We need more such reforms.   

More private and co-operative banks need to be encouraged to fund the farmers’ exports. Many a times, the crop insurance does not work with the insurance companies turning a blind eye during crisis. This has to be clearly monitored. With overall infrastructure support to the farmer, time has come to groom our farmer into a businessman.   

More crops shall be brought under MSP. Buying below MSP shall be banned not only by Government but even by private buyers. This will give guarantee to farmers of the output rate and cartelized change of demand-supply will not make farmers sell produce at the reduced rates. It may rise to situation that the real low demand will cause situation of farm produce not getting sold. This will force farmers to predict demand and do crop planning accordingly.   

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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Union Budget 2021-22

Veerendra Jamdade

CEO, Vritti Solutions

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