Sitharaman shifts focus to high-value crops and technology integration

Finance Minister Nirmala Sitharaman’s presentation of theUnion Budget 2026-27has revealed a distinct shift in how the government approaches the agriculture sector. Rather than announcing sweeping populist measures or massive financial injections, the Centre has opted for a cautious strategy defined by minor numerical adjustments and a focus on utilization rates.

For the upcoming fiscal year, the emphasis has narrowed down to two primary pillars: the promotion of high-value crops and the introduction of the 'Bharat Vistaar Plan'. This new initiative aims to seamlessly blend agricultural extension services with modern data and technology. However, the combined war chest for these specific new priorities is a modest Rs 500 crore, signaling a move towards pilot-style implementation rather than aggressive expansion.

Allocations and Under-spending

While the overall budget for agriculture and allied sectors has seen a marginal paper increase to Rs 1,62,671 crore—up from Rs 1,58,838 crore last year—the devil lies in the details of expenditure. The revised estimates for the current year show spending dropped to Rs 1,51,853 crore. This pattern of under-utilization has prompted the Finance Ministry to reduce or freeze funding for several flagship schemes, impacting expectations for farmers in agrarian states like Odisha.

Impact on Key Schemes

Significant changes were noted across major welfare programs. The Pradhan Mantri Krishi Sinchai Yojana, crucial for irrigation, saw its funds trimmed to Rs 6,587 crore following lower actual spending last year. Similarly, the river-linking project allocation dipped to Rs 1,906 crore.

However, the Krishonnati Yojana received a boost, rising to Rs 11,200 crore, likely accommodating the Prime Minister’s Dhan-Dhaanya Yojana. For the millions of farmers relying on direct cash support, theUnion Budget 2026-27maintains the status quo; the Pradhan Mantri Kisan Samman Nidhi allocation remains static at Rs 63,500 crore.

Research and Subsidies

Concerns have been raised regarding the Department of Agricultural Research and Education, which saw its funds cut to Rs 9,967.40 crore. This reduction comes despite the Economic Survey advocating for climate-resilient farming technologies. On the input side, the subsidy for Urea has been set at Rs 1,16,805 crore, which is lower than the revised estimates of the current year, indicating the government's intent to tighten fiscal outflows.

Ultimately, the budget signals that the Centre is unwilling to bear additional fiscal burdens for the farm sector until existing funds are utilized more efficiently by the respective ministries.

With Agency Inputs and Rural Voice