From Kisan Credit Cards to Capacity Building Measures: Here’s what Government announced to boost the farm sector

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Ministry of Finance

Presentation of details of 3rd Tranche by Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman under Aatmanirbhar Bharat Abhiyaan to support Indian economy in fight against COVID-19

Yesterday’s announcements related to farmers

1. Rs 30,000 crore Additional Emergency Working Capital for farmers through NABARD

  • NABARD will extend additional re-finance support of Rs 30,000 crore over and above the Rs 90,000 already being provided by NABARD for meeting crop loan requirement of Rural Cooperative Banks and RRBs.
  • Will benefit 3 crore farmers, mostly small and marginal.

2. Rs 2 lakh crore credit boost to 2.5 crore farmers under Kisan Credit Card Scheme

  • A special drive to provide concessional credit to PM-KISAN beneficiaries through Kisan Credit Cards.
  • Fisherman and Animal Husbandry Farmers will also be included in this drive.
  • Will inject additional liquidity of Rs 2 lakh crore to 2.5 crore farmers

Agriculture : Additional Steps during COVID

  • A number of measures supporting farmers was explained yesterday.
  • Additional measures taken during last 2 months are below
  • During lockdown period Minimum Support Price (MSP) purchases of amount more than Rs 74,300 crores
  • PM KISAN fund Transfer of Rs 18,700 crores
  • PM Fasal Bima Yojana claim payment of Rs 6,400 crores

Animal Husbandry : Additional Steps during COVID

  • During Lockdown, Demand of Milk reduced by 20-25%.
  • 560 Lakh litre per day(LLPD) procured by cooperatives against daily sale of 360 LLPD.
  • Total 111 Crore Litres extra procured ensuring payment of Rs 4100 Cr.
  • A new scheme to provide interest subvention @2% per annum to dairy cooperatives for 20-21.
  • Additional 2% p.a interest subvention on prompt payment/interest servicing.
  • This scheme will unlock 5000 Cr additional liquidity, benefitting 2 Cr farmers.

Fisheries: Additional Steps during COVID

  • All 4 COVID related announcements for fisheries implemented
    • Validity of Sanitary Import Permits (SIPs) for import of Shrimp Broodstock extended by 3 months
    • Condoned delay up to 1 month in arrival of Brood stock consignments
    • Allowed rebooking of Quarantine cubicles for cancelled consignments with no additional charges
    • Verification of documents and grant of NOC for Quarantine relaxed from 7 days to 3 days
  • Registration of 242 Registered Shrimp hatcheries and Nauplii Rearing Hatcheries expiring on 31.03.2020 extended for 3 months
  • Operations of Marine Capture Fisheries and Aquaculture relaxed to cover Inland Fisheries

Measures to strengthen Infrastructure Logistics and Capacity Building

Rs 1 lakh crore Agri Infrastructure Fund for farm-gate infrastructure for farmers

  • Lack of adequate cold chain & Post Harvest Management infrastructure in the vicinity of farm-gate causing gaps in value chains.
  • Focus has been on short term crop loans while investment in long term agriculture infrastructure has often not been enough.
  • Financing facility of Rs. 1,00,000 crore will be provided for funding Agriculture Infrastructure Projects at farm-gate & aggregation points (Primary Agricultural Cooperative Societies, Farmers Producer Organisations, Agriculture entrepreneurs, Startups, etc.)
  • Impetus for development of farm-gate & aggregation point, affordable and financially viable Post Harvest Management infrastructure
  • Fund will be created immediately.

Rs 10,000 crores scheme for Formalisation of Micro Food Enterprises (MFE)

  • Scheme promotes vision of Hon. PM: ‘Vocal for Local with Global outreach’
  • Unorganised MFEs units need technical upgradation to attain FSSAI food standards, build brands and marketing
  • A Scheme will be launched to help 2 lakh MFEs attain attain above goals
  • Existing micro food enterprises, Farmer Producer Organisations, Self Help Groups and Cooperatives to be supported
  • Cluster based approach (e.g. Mango in UP, Kesar in J&K, Bamboo shoots in North-East, Chilli in Andhra Pradesh, Tapioca in Tamil Nadu etc.)
  • Expected outcomes: Improved health and safety standards, integration with retail markets, improved incomes
  • Will also help in reaching untapped export markets in view of improved health consciousness.

Rs 20,000 crores for Fishermen through Pradhan Mantri Matsya Sampada Yojana (PMMSY)

  • Critical gaps in fisheries value chain
  • Government will launch the PMMSY for integrated, sustainable, inclusive development of marine and inland fisheries.
  • Rs 11,000 Cr for activities in Marine, Inland fisheries and Aquaculture
  • Rs. 9000 Cr for Infrastructure – Fishing Harbours, Cold chain, Markets etc.
  • Cage Culture, Seaweed farming, Ornamental Fisheries as well as New Fishing Vessels, Traceability, Laboratory Network etc. will be key activities.
  • Provisions of Ban Period Support to fishermen (during the period fishing is not permitted), Personal & Boat Insurance
  • Will lead to Additional Fish Production of 70 lakh tonnes over 5 years.
  • Employment to over 55 lakh persons; double exports to Rs 1,00,000 Cr.
  • Focus on Islands, Himalayan States, North-east and Aspirational Districts.

National Animal Disease Control Programme

  • National Animal Disease Control Programme for Foot and Mouth Disease (FMD) and Brucellosis launched with total outlay of Rs. 13,343 crores.
  • It ensures 100% vaccination of cattle, buffalo, sheep, goat and pig population (total 53 crore animals) for Foot and Mouth Disease (FMD) and for brucellosis.
  • Till date, 1.5 crore cows & buffaloes tagged and vaccinated.

Animal Husbandry Infrastructure Development Fund – Rs. 15,000 crore

  • Many areas in country with high milk production having great potential for private investment in Dairy
  • Aim to support private investment in Dairy Processing, value addition and cattle feed infrastructure
  • An Animal Husbandry Infrastructure Development Fund of Rs. 15,000 crore will be set up.
  • Incentives to be given for establishing plants for export of niche products.

Promotion of Herbal Cultivation : Rs. 4000 crore

  • National Medicinal Plants Board (NMPB) has supported 2.25 lac hectare area under cultivation of medicinal plants
  • 10,00,000 hectare will be covered under Herbal cultivation in next two years with outlay of Rs. 4000 crore
  • Will lead to Rs. 5,000 crores income generation for farmers
  • Network of regional Mandis for Medicinal Plants.
  • NMPB will bring 800 hectare area by developing a corridor of medicinal plants along the banks of Ganga.

Beekeeping initiatives –Rs 500 crores

  • Beekeeping is a livelihood supporting activity for rural areas;
  • Increases yield & quality of crops through pollination;
  • Provides honey and other beehive products like wax.

Government will implement a scheme for:

  • Infrastructure development related to Integrated Beekeeping Development Centres, Collection, Marketing and Storage Centres, Post Harvest & value Addition facilities etc;
  • Implementation of standards & Developing traceability system
  • Capacity building with thrust on women;
  • Development of quality nucleus stock and bee breeders.

This will lead to increase in income for 2 lakh beekeepers and quality honey to consumers.

From ‘TOP’ to TOTAL – Rs 500 crores

  • Supply chains have been disrupted and farmers are not being able to sell their produce in the markets
  • Distress sale and reduction of price of perishable fruits and vegetables at the farm level needs to be prevented.
  • Operation Greens will be extended from Tomatoes, Onion and Potatoes (TOP) to ALL fruits and vegetables (TOTAL).
  • Scheme features will be as follows:
    • 50% subsidy on transportation from surplus to deficient markets.
    • 50% subsidy on storage, including cold storages.
  • Pilot for 6 months – Will be expanded and extended
  • Expected outcomes: Better price realisation to farmers, reduced wastages, affordability of products for consumers

Governance and Administrative Reforms

Amendments to Essential Commodities Act to enable better price realisation for farmers

  • EC Act, 1955 was enacted in days of scarcity.
  • Need to enable better price realisation for farmers by attracting investments and making agriculture sector competitive
  • Agriculture food stuffs including cereals, edible oils, oilseeds, pulses, onions and potato to be deregulated.
  • Stock limit to be imposed under very exceptional circumstances like national calamities, famine with surge in prices.
  • No such stock limit shall apply to processors or value chain participant, subject to their installed capacity or to any exporter subject to the export demand.
  • Government will amend Essential Commodities Act.

Agriculture Marketing Reforms to provide marketing choices to farmers

  • Farmers bound to sell agriculture produce only to Licensees in APMCs
  • Such restriction of sale is not there for any industrial produce
  • Results in Hindrances in free flow of Agricultural Produce and
  • Fragmentation of Markets and Supply Chain;
  • Less price realization for farmers.

A Central law will be formulated to provide –

  • Adequate choices to farmer to sell produce at attractive price;
  • Barrier free Inter-State Trade;
  • Framework for e-trading of agriculture produce

Agriculture Produce Price and Quality Assurance

  • Farmers lack an enforceable standard mechanism for predictable prices of crops at the time of sowing.
  • Private sector investment in provision of inputs and knowhow in the agriculture sector hindered
  • Facilitative legal framework will be created to enable farmers for engaging with processors, aggregators, large retailers, exporters etc. in a fair and transparent manner.
  • Risk mitigation for farmers, assured returns and quality standardisation shall form integral part of the framework.