Initiatives taken in Budget 2010-11 will facilitate the agri-food sector to overcome the various issues it is facing and provide adequate supply of food grains to consumers In the recently announced Union Budget for 2010-11, the food and agriculture sector was given a lot of importance, in view of the short supply of food grains at present. According to a poll conducted by FoodProcessing360, 83% of the respondents feel that the recent Budget will resolve the various issues facing the agri-food industry. However, 8% of the respondents think otherwise and another 8% respondents are uncertain about the impact of the Budget proposals on the agri-food sector. Initiatives taken In a bid to bring about green revolution in Bihar, West Bengal, Orissa and Jharkhand, finance minister Pranab Mukherjee has proposed to allocate Rs 400 crore towards the same. An additional Rs 300 crore will be assigned for developing 6,000 pulse and oilseed villages in the north-eastern parts of Although the food security policies have been bolstered, the food inflation rates continue to rise due to adverse climatic conditions. In order to cope with the food insecurity, the government has decided to introduce the Food Security Bill. With the implementation of the Bill, consumers in the Below Poverty Line (BPL) category will be provided 25 kg of wheat or rice at Rs 3 per kg. In this context, Vishnu Najan, CEO of Vanashree Agriculture Private Limited, a mid-sized agro product manufacturer in Pune says, “The Food Security Bill would be beneficial to BPL consumers only if they are aware about the norms laid by the government. Besides, revision of the BPL list and prohibition of black marketing of food grains will also aid these consumers.” The government has decided to seek assistance from the private sector in order to increase the storage facility for food grains. To further bolster the food processing sector, the finance minister has proposed setting up of 5 additional mega food parks besides the 10 mega food parks that are already under implementation. Mr Mukherjee has also proposed a system to transfer the fertiliser subsidies directly to the farmers. The nutrient-based fertiliser subsidy will be effective from the beginning of 2010-11. “Implementation of this subsidy will improve the crop production and thereby help farmers to fetch better returns,” says Dipak Dahiphale, CEO of Sumohan International, a small-sized food grain exporter in Mumbai. Another positive outcome of the Budget is extension of the loan repayment period for farmers by 6 months to June 30, 2010. In addition to this, the government has also doubled the interest subvention for repayment of crop loans on time from 1% to 2%, which revises the effective rate of interest to 5%. Sabrina Mitchell |
