Riding high on a populist mandate but facing growing concerns of a slowdown in the economy and a rising fiscal deficit, last week Finance Minister Arun Jaitley presented the new Indian government's first annual budget, attempting a delicate balancing act that reforms populist subsidies while providing additional income to the common man through increased tax exemptions.
In terms of the urgent need to reform agriculture, address climate change and promote sustaianable watershed development, the new budget provides for a number of promising initiatives. We look forward to watching how the implementation of these initiatives unfolds over the coming months.
In the case of agriculture, the budget is almost comprehensive, addressing the major concerns of all sectors related to food production in the country.
The initiation of the Pradhan Mantri Krishi Sinchayee Yojana scheme with a sum of Rs. 10 billion is a welcome step toward providing assured irrigation to farmers, though much will depend on how the scheme is implemented, especially as regards reaching out to small and marginal farmers, who comprise more than 80 percent of the farming community in India.
The government's push to strengthen agricultural research by allocating an Rs. 1 billion to create two centres of excellence in Assam and Jharkhand, the funding of a new Rs. 1 billion Agri-Tech Infrastructure Fund, and the setting up of two new Agricultural and Horticultural Universities are also noble initiatives.
The government's budget also proposes a scheme to provide a soil health card to every farmer. Needless to say, soil testing is extremely important, impacting all aspects of productivity, so the proposal to set up 100 Mobile Soil Testing Laboratories across the country could not have come at a better time. We hope that this step marks the beginning of concentrated efforts towards a comprehensive soil health programme in the country.
Proposed reforms of the Mahatma Gandhi National Rural Employment Guarantee Act (a program that guarantees every rural household at least than 100 days of wage employment to per year) to ensure that guaranteed work is more productive, asset-creating and substantially liked to agriculture and allied activities, is also a welcome step.
In addition to the above, the budget outlines the creation of a Price Stabilization Fund to address price volatilities; enhanced allocation for agriculture credit; creation of a Warehouse Infrastructure Fund for increasing the shelf life of agriculture produce; and the launch of a dedicated Kisan (Farmer) TV Channel for disseminating real time information to farmers regarding new farming techniques, water conservation, organic farming etc.
As far as climate change goes, the creation of a National Adaptation Fund to address its impacts will bring needed attention and focus to this threat. To be effectively implemented, however, the program will require careful coordination with the National Mission for Sustainable Agriculture that was launched last year.
Regarding water, the budget proposed the launch of a scheme for solar power-driven agricultural pump sets and water pumping stations for energizing one lakh pumps. In addition there is a proposal for the development of 1 MW-sized solar parks on the banks of canals.
Watershed development is critical to to the preservation of natural resources in rural areas. The announcement of a new watershed programme, 'Neeranchal', with an initial outlay of Rs. 21.42 billion, is a commendable step toward this goal. What will ensure the success of Neeranchal is the integration of funds and functionaries at the local level for realising the benefits of the programme.
In the case of drinking water, the allocation of Rs. 36 billion for addressing water quality problems (arsenic, fluoride, heavy/ toxic elements, pesticides/ fertilizers) across 20,000 rural homes through community based treatment plants is a good step. However, the identification of the most effective community-based approaches remains a challenge; models implemented so far have achieved very limited success.
The allocation for sanitation is not clearly specified, which is a cause of concern. While there is a lot of focus on cleaning of the Ganges through the creation of a Rs. 20.37 billion Integrated Ganga Conservation Mission ('Namami Gange') and the allocation of Rs. 1 billion for beautification of Ganga Ghats across the country, what remains to be seen is how the government plans to implement these programs. We will need to learn from the past failures of the Ganga Action Plan and devise a means for inter-agency and state coordination, which has been lacking in the past.
While the new environmental and agricultural initiatives outlined in the budget speech of the Finance Minister look promising, it remains to be seen how the various nodal ministries will develop a roadmap for implementation and enforcement. We look forward to seeing how the good intentions reflected in Mr. Jaitley speech are reflected in the 100-day agenda of the government.
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