Allocation for agriculture up by 22 % to Rs27,049 cr

Finance minister P Chidambaram has proposed an outlay of Rs.27,049 crore for the ministry of agriculture in the Union Budget 2013-14. Out of this, Rs.3415 crore will be provided for agricultural research.

The outlay is 22 per cent over the revised estimates of 2012-13.

Of this, Rs307 crore is proposed to be provided for the National Livestock Mission which will be launched in 2013-14 to attract investment and to enhance productivity. There will be sub-mission for increasing the availability of feed and fodder.

The finance minister said that the agricultural exports from April to December 2012 have crossed Rs138,403 crore. The increase in Minimum Support Price of every agricultural produce under the procurement programme have motivated the farmers to produce more.

In 2012-13, the foodgrain production will be over 250 million tonnes, he added.

Thanking the farmers for their hard work, the finance minister stated that the average annual growth rate of agriculture and allied sector during the 11th Plan was 3.6 per cent as against 2.5 per cent and 2.4 per cent in the 9th and 10th Plans, respectively.

Chidambaram said the agricultural credit target has been increased to Rs.7 lakh crore from the earlier Rs.5.75 lakh crore. The short-term crop loan scheme (Interest Subvention Scheme) has been extended to the crop loans borrowed from private sector scheduled commercial banks in respect of loans given in the service area of the branch concerned.

Earlier the scheme was applicable to loans extended by the Public Sector Banks, Regional Rural Banks (RRBs) and Co-operative Banks.

Under this Interest Subvention Scheme, a farmer will be able to get loans at 4 per cent per annum if he repays the short-term crop loan on time.
  
The finance minister also proposed a matching equity grants to registered Farmer Producer Organisations (FPOs) upto a maximum of Rs.10 lakh per FPO to enable them to leverage working capital from financial institutions. For this purpose, an outlay of Rs.50 crore has been kept.

Besides, a Credit Guarantee Fund will also be created in the Small Farmers' Agri Business Corporation with an initial corpus of Rs.100 crore. The state governments need to bring necessary amendments to the APMC Act to support such FPOs.

The FPOs,  including Farmer Producer Companies (FPCs), have emerged as aggregators of farm produce and link farmers directly to markets, Chidambaram added.