Agriculture

Agriculture Sector in Budget 2025

Context: In the Union Budget, the government has termed agriculture as the first engine of growth and announced PM Dhan Dhanya Yojana.  The Economic Survey 2024-25 claimed the agriculture sector as the sector of the future.

Relevance of the Topic:  Mains: Detailed question on agriculture sector; challenges; issue; prospects.

Government Efforts in Budget 2025: 

  • PM Dhan-Dhaanya Krishi Yojana: 
    • New scheme announced to provide impetus in agriculture growth to 100 districts in the country (under phase 1). 
    • Focuses on five key aspects; enhancing productivity, improving irrigation facilities; improve credit availability; to adopt crop diversification; to augment post harvest storage at panchayat and block level.
  • Rise in Kisan Credit Card interest subvention:
    • A rise to 5 lakh from 3 lakh in the Modified interest subvention scheme.
  • Boosting fisheries sector- 
    • The budget is targeted to boost the fisheries sector as it has increased the budgetary allocation of fisheries by 1500 crore. 
    • Also there is a reduction from 30% to 5% on the custom duties on Frozen Fish Paste for the manufacturers and exporters to provide a boost to the fisheries sector in India.
  • Promoting crop diversification-
    • Atmanirbhar in pulses- Budget has announced a six-year long mission to become self-reliant in the in pulses with a special focus on tur, urad and masoor.
    • Fox seed (Makhana) development- Government has also announced a 100 crore budget for the Makhana Board of Bihar to boost the processing and value addition of the fox seeds.
  • National Mission on Seeds: 
    • The National Mission on High Yielding Seeds will be launched.
    • Aim: To enhance the research ecosystem, focus on developing and promoting seeds with high yields, pest resistance, and climate resilience, and make more than 100 seed varieties commercially available.
  • Mission for cotton productivity: 
    • This would be a five-year mission, it will facilitate significant improvements in productivity and sustainability of cotton farming, and promote extra-long staple cotton varieties. 
    • The best science and technology support will be provided to farmers.
  • Enhancing loan limits for farmers: 
    • The finance minister also announced increasing the loan limit under the Modified Interest Subvention Scheme (MISS) from Rs 3 lakh to Rs 5 lakh. 
  • New Urea fertilizer plant 
    • To achieve self-sufficiency in urea fertilizer, the finance minister announced to set up a plant with an annual capacity of 12.7 lakh metric tons at Namrup in Assam.
image 25

Prospects of Agriculture Sector: 

  • Largest workforce participation: A maximum of 46.1% of the labour force participate in the agriculture and allied activities, making it the largest sector to provide employment to the people.
  • Women participation: As per Oxfam 80% of the agriculture laborers are women, also maximum women SHGs are associated with the agriculture and allied activities leading to an impetus to women empowerment and participation in the economic activities.
  • Fostering associated ecosystem: Agriculture activities are associated with the food processing industries, boost to agriculture productivity will lead to the growth of these export and consumer associated sectors
  • Helping in rural demand growth: Growth of agriculture will lead to the boost in the demand of the rural regions leading to more investments in the rural sector.
  • Poverty alleviation- As per the situation assessment survey of agriculture, 22% of Below poverty line belong to the agriculture sector/ Agriculture growth and investment will lead to the targeted poverty alleviation.

Major Challenges in the Agriculture Sector: 

  • Climate stress- The climate change and unpredictable weather patterns adversely affect the crop yield. Eg; Kashmir saffron production declined from 8 metric tons in the past 12 years. 
  • Fragmented land holding- Around 80% of Indian farmers operate on small plots, that hinders the economies of scale and affects profitability.
  • Lack of modernisation- India agriculture lacks the modernisation techniques especially for the women participants in the agriculture. Eg; Agriculture mechanisation level in India is around 40% that is considerably lower than China and USA
  • Price fluctuation and market uncertainties- Farmers often lack direct access to markets, leading to dependence on intermediaries who may offer unfavorable prices. 
  • Informal credit- Indian farmers, despite numerous efforts for financial inclusion, depend on the informal sources of the credit. Eg; 23% farm credits are from informal sources.
  • Limited agriculture extension- Farmer and agriculture development is restrained by the limited research and development and underdeveloped agriculture extension in India.

Way Forward: 

  • Adopting climate-resilient crops, cooperative farming, and smart irrigation practices. 
  • Integrating technology through AI-based advisory services and digital marketplaces like e-NAM to enhance productivity and market access. 
  • Strengthening MSP procurement and financial support, including improved crop insurance to safeguard farmers from distress. 
  • Sustainable practices like organic farming and integrated pest management to ensure long-term soil health. 
  • Government initiatives such as PMKSY and PMFBY, along with private sector participation, to drive agricultural transformation. 

A holistic approach combining policy support, technology, and sustainability can make Indian agriculture more resilient, productive, and profitable for farmers. 

Prime Minister Dhan-Dhaanya Krishi Yojana

Context: In the Union Budget 2025-26, the Finance Minister announced several new initiatives for the agriculture sector, including the Prime Minister Dhan-Dhaanya Krishi Yojana.

Relevance of the Topic: Prelims: Key facts about Prime Minister Dhan-Dhaanya Krishi Yojana.

About Prime Minister Dhan-Dhaanya Krishi Yojana

  • The scheme will be launched in partnership with states through the convergence of existing schemes and specialised measures.  
  • No separate allocation has been made for the Prime Minister Dhan-Dhaanya Krishi Yojana, however, there are allocations for existing schemes which are to be converged: 
  • Rs 1,000 crore has been allocated for the mission for pulses. 
  • Rs 500 crore for the mission for vegetables and fruits. 
  • Rs 100 crore support for the Makhana Board. 
  • Rs 100 crore for the mission on hybrid seeds. 
  • Rs 500 crore for the cotton technology mission.
  • In phase 1, It will be launched in 100 districts with low crop productivity, moderate crop intensity and below-average credit parameters.
    • It is expected to benefit 1.7 crore farmers spread across the targeted districts.
    • The scheme draws inspiration from the Aspirational Districts Program and would drive focused reforms to uplift farmers in underdeveloped agricultural regions.

Key focus of PM Dhan-Dhaanya Krishi Yojana

  • Enhance agricultural productivity
  • Adopt crop diversification and sustainable agriculture practices
  • Augment post-harvest storage at the panchayat and block level
  • Improve irrigation facilities 
  • Facilitate availability of long-term and short-term credit.
Key focus of PM Dhan-Dhaanya Krishi Yojana

Components:

Rural Prosperity and Resilience Program: 

  • It aims at addressing under-employment in agriculture through skilling, investment, technology, and invigorating the rural economy. 
  • The goal is to generate ample opportunities in rural areas so that migration is an option, but not a necessity. 
  • The programme will focus on rural women, young farmers, rural youth, marginal and small farmers, and landless families.
  • Global and domestic best practices will be incorporated and appropriate technical and financial assistance will be sought from multilateral development banks.

Aatmanirbharta in Pulses:

  • The government will launch a 6-year mission with a special focus on Tur, Urad and Masoor. 
  • The Mission will place emphasis on development and commercial availability of climate resilient seeds; enhancing protein content; increasing productivity; improving post-harvest storage and management and assuring remunerative prices to the farmers. 
  • Central Agencies (NAFED and NCCF) will procure these 3 pulses, as much as offered during the next 4 years from farmers who register with these agencies and enter into agreements.

Comprehensive Programme for Vegetables & Fruits: 

  • A comprehensive programme to promote production, efficient supplies, processing, and remunerative prices for farmers will be launched in partnership with states. 
  • Appropriate institutional mechanisms for implementation and participation of farmer producer organizations and cooperatives will be set up.

Grameen Credit Score: Public Sector Banks will develop the ‘Grameen Credit Score’ framework to serve the credit needs of SHG members and people in rural areas.

Contract Farming in India

Context: India has emerged as a major exporter of French Fries attributed to the success of contract farming. It is a model through which companies procure high-quality potatoes directly from growers.

Relevance of the Topic:Mains: Contract Farming: Advantages, Challenges 

What is Contract Farming?

image 188
  • According to the Food and Agriculture Organisation (FAO), Contract farming is an agreement between farmers and processing and/or marketing firms for the production and supply of agricultural products under forward agreements, frequently at pre-determined prices.

Rationale behind Contract Farming in India

  • Generating a steady source of income for small-scale and marginal farmers.
  • Focus on growing market-oriented crops.
  • Promote food processing and value addition and enhance exports. 
  • Attract private sector investments into the agriculture sector, promoting innovation. 
  • Reducing government burden of procurement or providing fair prices for the produce.
  • Diversifying crops and reducing the stress of growing traditional crops continuously.
  • Educating farmers about agri-business and market share of their produce. 
  • Streamlines sourcing of raw materials for food processing units.

Advantages of Contract Farming

Producer/FarmerBuyer/Firms
Assured income.

They get the desired quality and quantity of produce.
Access to modern technology, credits, and cost information.Consistent supply of produce/raw material.
Doorstep exchange of produce, minimising transportation and marketing costs.The most effective and preferred way to utilise their resources.
Minimising risks related to production and damage.Direct investment in the agriculture sector.
Higher production and quality yieldFixed price and no further negotiations after the contract is made. Cheaper option of all.
Assured market priceIncreases brand value by having proper explanations for food safety concerns.
Knowledge acquisition and other intangible benefits.Control over the variety of produce and other inputs.

Challenges associated with Contract Farming

  • Exploitation of Small-scale Farmers: Weak bargaining power of farmers, lack of knowledge compared to a team of market analysts and economists makes them vulnerable to unfair terms. 
  • High Risks for Farmers: To meet the demands of firms, farmers have to make a change in their cropping pattern. This makes them overly dependent on contracting firms for inputs and market access, and makes them vulnerable to firms’ decisions. 
  • Lack of Legal Protection: Informal (verbal) or poorly enforced contracts often fail to protect farmers’ interest. Minimal legal recourse in the event of breach of agreements. 
  • Monopsony: A single buyer dealing with multiple farmers limits competition, promotes dependency and limits farmers’ negotiating power. 
  • Differential Contractual Agreements: Large-scale farmers often receive better terms in the contract than the small-scale farmers for the same commodity, by the same firm. 
  • Problems faced by growers like undue quality cut on produce by firms, delayed deliveries at the factory, delayed payments, low price and pest attack on the contract crop which raised the cost of production.

Case Study: Success Story of French Fries:

  • India has transitioned from importing to exporting frozen French fries. Varieties of potato like Innovator, Atlantic, and Markies are grown specifically for processing into fries. 
  • Companies like McCain Foods, HyFun Foods, and Iscon Balaji Foods directly engage with farmers, ensuring a consistent supply of high-quality potatoes. 
  • Farmers benefit from assured markets, stable incomes, and technical guidance, while companies gain reliable raw material. 
  • This partnership has bolstered India’s agricultural exports and rural economy, with Gujarat emerging as a key hub. 
  • The model highlights how contract farming can align farmers' interests with global demand for processed food products.

Legal status of Contract Farming in India: 

  • Agriculture and Agricultural Marketing is a State Subject.
    • Agricultural marketing is regulated by the States’ Agricultural Produce Marketing Regulation (APMR) Acts. 
    • Over 20 states of India have amended their APMR Acts to provide for contract farming.
  • Tamil Nadu is the first State in India to enact a law on contract farming in 2019- Agricultural Produce and Livestock Contract Farming and Services (Promotion and Facilitation) Act.
    • Aim: To safeguard interests of farmers during times of bumper harvest or fluctuating market prices.
    • Key Features (Can be used as Way Forward):
      • Farmers would be paid at a pre-determined price arrived at the time of signing agreements with buyers.
      • Farmers could get support from purchasers for improving production and productivity by way of inputs, feed and fodder, and technology. 
      • Any produce, banned by the Centre or State government or the Indian Council of Agricultural Research, would not be covered under contract farming.
      • Such agreements would have to be registered with designated officers from the Department of Agricultural Marketing and Agri Business.
      • State Contract Farming and Services (Promotion and Facilitation) Authority, would be formed to ensure proper implementation of this Act.
  • The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 was an Act to create a national framework for contract farming through an agreement between a farmer and a buyer before the production or rearing of any farm produces. However, the Act was repealed owing to farmer protests. 

India's first Edible Oil Survey

Context: The Union Ministry of Agriculture has launched its first-ever survey to assess edible oil consumption patterns in India, aiming to effectively implement the new Mission on Edible Oils-Oilseeds (NMEO-Oilseeds). 

Relevance of the Topic: Prelims: Questions about Palm oil and edible oil data of India; National Mission for edible-oil.

Major Highlights of the Survey: 

  • The Survey involved a 45 days questionnaire from the various stakeholders like consumers and distributors of edible oil. 
  • Aim: To capture the consumption pattern and choice of edible oils, which will help in policy decisions.
  • Behavioural analysis: 
    • The survey also analyses the behaviour pattern and influence of advertisement, labelling and willingness to pay for premium oils. 
    • The survey also explores various aspects like deep-frying frequency, seasonal usage pattern and factors influencing oil selection. 
  • Need for the survey: Report indicates that there is a rise in per capita consumption of the edible oils to over 20kg in India. This reflects the lifestyle and health risks as Indian Council for Medical Research (ICMR) recommends per capita consumption should be less than 12 Kg. 

Significance of the Survey

  • Evaluating pattern: Help in understanding the pattern of consumption of edible oils in India, as India is the largest consumer of oil in the world. 
  • Policy formulation: Understanding consumption patterns will help in regulation of production and import of edible oils by effective policy formulation (implementation of NMEO-Oilseeds). 
  • Controlling advertisement: By understanding the impact of advertisement on buying patterns of consumers, the government can take effective measures to counter fake claims in edible oil advertisements by companies. 
  • Preventive measures: The survey will allow the Ministry of Health and Family Welfare to launch an awareness campaign to counter negative health implications of consumption on health. 

Issues in Indian Edible Oil Sector

  • Import dependency: India imports 55-60% of its edible oil requirement from nations Indonesia, Malaysia, Ukraine, etc. 
  • Dominance of Palm Oil: Palm oil dominates the consumption with 38% share in Indian edible oil consumption. 
  • Health challenges: Rise in oil consumption and prevalence of fast-foods raised oil consumption in India is leading to negative health implications. 

Suggestive measures

  • Diversification of oilseed by replacing the Palm oil with other oilseeds like sesame and groundnut oil. It is beneficial for the balance of trade and health of consumers. 
  • Promoting oil seed cultivation. More efforts like fund devolution and capacity building of farmers to cultivate oil seeds. E.g., National Mission for Edible-Oils Oilseeds programme. 
  • Awareness: Dedicated campaign on the lines of DASH eating plan that emphasises more on the fruits and vegetable consumption by replacing edible oils from diet. 
  • Strengthening norms: Government should make trans-fat norms more stringent under the Eat Right Campaign in line with the World Health Organisation (WHO).
    • In India the trans-fat limit is 2% while as per WHO it should not be more than 1%. 
image 164

About National Mission for Edible-Oils Oilseeds programme

  • The National Mission on Edible Oils – Oilseeds (NMEO-Oilseeds) is a dedicated initiative for boosting oilseed production in India.
  • Aim: To boost domestic oilseed production and achieve self-reliance in edible oils. 
  • Implementation Period: 2024-25 to 2030-31
  • Financial outlay: Rs 10,103 crores
  • Scheme has the following targets:
    • Increasing oilseed production from 39 million tonnes (2022-23) to 69.7 million tonnes by 2030-31.
    • Focus on crops like Rapeseed-Mustard, Groundnut, Soybean, Sunflower, and Sesamum, as well as improving extraction from secondary sources. 
    • Promote high-yielding seed varieties, rice fallow cultivation, and intercropping, aiming to meet 72% of domestic edible oil needs by 2030-31. 

National Turmeric Board

Context: The Ministry of Commerce & Industry has established the National Turmeric Board of India at Nizamabad, Telangana.

Relevance of the Topic Prelims: Key facts about the National Turmeric Board. 

About National Turmeric Board

  • The National Turmeric Board is a dedicated body that will focus on the development and growth of turmeric and turmeric products in the country.
  • Nature: It is not a statutory body.
  • Nodal Ministry: Ministry of Commerce & Industry. 
  • Functions: The board will perform following functions;
    • Trade policy: It will work on policy formulation to increase turmeric yield and boost logistics and supply chain to foster trade into newer markets. The board has been constituted to boost turmeric exports to $1 billion by 2030. 
    • R&D and value addition: It will promote research and development of new turmeric products, and will look into value addition of turmeric related products for marketing abroad. 
    • Ensure quality and safety standards: It will ensure quality and safety standards of turmeric production and exports. It will put efforts to enhance the capacity of farmers and food producer agencies for the same. 
    • Awareness generation: It will work on awareness generation about the medicinal and essential properties of turmeric.

About Turmeric

  • Turmeric (Curcuma longa) is a flowering plant from the Ginger family grown in temperature conditions of 20-30 degrees Celsius and high rainfall conditions.
  • India is the largest producer, consumer and exporter of turmeric with 75% of global production.
  • It has anti-bacterial and anti-inflammatory properties, and finds its mention in Ayurveda as Haridra.
  • More than 30 varieties of Turmeric are grown in India and it is grown in over 20 states in the country. 
  • The largest producing states of Turmeric are Maharashtra, Telangana, Karnataka and Tamil Nadu.
  • The leading export markets for Indian Turmeric are Bangladesh, UAE, USA and Malaysia.

Time to recalibrate PM-KUSUM Scheme

Context: The PM KUSUM scheme has achieved significant results, however, in order to achieve its objectives, both the Centre and the State governments have to work in sync, while recalibrating the process of implementation.

Relevance of the topic:

Prelims: PM KUSUM Scheme.

Mains: PM KUSUM- Challenges and Recommendations. 

What is the PM KUSUM scheme?

PM-KUSUM Scheme
  • PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme was launched by the Ministry of New and Renewable Energy in 2019.
  • It was launched in order to endow installation of off-grid solar pumps in rural areas and reduce dependence on grid, in grid-connected areas.
  • Objectives:
    • To enable farmers to set up solar power generation capacity on their arid lands and to sell it to the grid.
    • To increase the income of farmers by allowing them to sell surplus solar power to the grid.
  • Components:
    • Component A: 10,000 MW of decentralised ground-mounted grid-connected renewable power plants.
    • Component B: Installation of 20 lakh solar-powered agriculture pumps.
    • Component C: Converting 15 lakh agriculture pumps, already connected to the grid, into solar.

Significance of the Scheme:

  • Increase Access to Energy:
    • It incentivises the farmers to sell surplus solar energy to the states, which in turn will augment their income.
    • The scheme is expected to increase access to electricity in rural areas and provide a reliable source of energy for agriculture and other rural activities.
  • Contain Climate Catastrophe:
    • If farmers are able to sell surplus power, they will be incentivised to save power and, in turn, it will mean the reasonable and efficient use of groundwater.
    • Expansion of the irrigation cover by providing decentralised solar-based irrigation and moving away from polluting diesel.
    • When implemented fully, PM-KUSUM will lead to reducing carbon emissions by as much as 32 million tonnes of CO2 per annum.
  • Employment and Empowerment:
    • The scheme creates job opportunities in the installation, maintenance, and operation of solar power projects.
    • It empowers rural communities by giving them control over their own energy generation and distribution.

Challenges in Implementation:

  • Component-wise Progress:
    • Component A: Minimal progress due to lack of bidding guidelines and low feed-in tariffs.
    • Component B: Most successful, with 60% Central financial assistance and decentralised implementation in states like Rajasthan.
    • Component C: Limited traction due to lack of incentives for farmers already receiving cheap electricity.
  • Political Bias:
    • Divergence between Centre-State relations impacts scheme adoption. E.g., Bihar’s non-participation due to earlier political differences.
  • Operational Issues:
    • Inter-state Disparity E.g., Chhattisgarh and Rajasthan together account for half of two lakh solar pumps currently deployed in the country. 
    • Centralised implementation limits effectiveness.
    • Insufficient awareness campaigns and quality concerns for pumps.
    • Dependence on groundwater availability and irrigation challenges.

Way Forward

  • Decentralised Implementation:
    • Leverage local agencies for tailored execution.
    • Target linked financial assistance to reduce Inter-state disparity and address state-specific constraints.
  • Financial Incentives:
    • Increase Central assistance for Components A and C.
    • Introduce farmer-friendly payment options.
  • Policy Reforms:
    • Align agricultural subsidies with solar adoption to ensure farmer participation.
    • Promote dual-use models like Agro-PV (energy and farming integration).
    • Give up One Size Fits-all approach: Small and marginal farmers should be given a higher capital subsidy and long-term loans with interest subsidies.
  • Focus on Efficiency of Pumps: Solarising grid connected pumps must include replacement of the pump with more energy efficient newer age pumps. 
  • Awareness and Capacity Building: Wide-reaching campaigns to educate stakeholders. Training programs for farmers and implementing agencies.
  • Focus on Post-harvest losses: Use solar power for post-harvesting processes to promote local value addition and enhanced income levels.

By addressing implementation challenges, PM KUSUM can contribute significantly to climate action, energy security, and rural development. Its success depends on a holistic approach that integrates policy, technology, and local insights.

Urea Industry: Success Story

Context: Amid shortages in di-ammonium phosphate (DAP) and a general lack of manufacturing sector investments, the urea industry has seen significant installation of new production capacities and progress towards achieving the goal of Atmanirbharta.

Relevance of the Topic: Prelims: Basic understanding of Urea Industry- Present Status, Make vs Buy, etc.

Present Status of the Urea Industry

  • Domestic urea production:
    • Between 2011-12 and 2023-24, India’s domestic urea production has risen from 22 million to 31.4 million tonnes.
  • Urea Imports:
    • Imports fell from 7.8 mt to 7 mt after peaking at over 9.8 mt in 2020-21. 
  • The current fiscal has so far recorded a further 31.7% drop in imports.
image 16

Read more: Fertilizer Subsidies: Mechanism and Challenges 

Benefits of Greenfield Projects in Urea Industry

  • Increased Production: The increase in urea production is attributed to six new plants launched in FY 2019 and later:
    • Three of Hindustan Urvarak & Rasayan Ltd (HURL) 
    • Chambal Fertilisers & Chemicals
    • Matix Fertilisers & Chemicals 
    • Ramagundam Fertilizers & Chemicals Ltd (RFCL)
  • Climate-friendly:
    • These greenfield plants run on natural gas (mostly imported) with an identical annual production capacity of 1.27 mt. 
  • Energy-efficient:
    • They are also relatively energy-efficient, requiring only about 5 giga-calories (GCal) to produce one tonne of urea. The earlier units consume between 5.5 and 6.5 GCal.
  • Favourable Location:
    • The new plants are located in the new Green Revolution- areas of eastern Uttar Pradesh, West Bengal, Bihar, Jharkhand and Telangana.
    • The older units such as the National Fertilizers Ltd’s (NFL) Bathinda, Nangal and Panipat catered solely to farmers in Punjab and Haryana.
  • Indigenous feedstock:
    • There is a seventh urea plant coming up in Talcher, Odisha.
    • Unlike the six gas-based units producing ammonia with technology licensed from US, Denmark and urea from Italy or Japan, Talcher Fertilizers Ltd’s project will use coal as the feedstock. The coal is from the Talcher mines. 

The Make vs. Buy debate

  • Arguments supporting “Buy”:
    • Investment:
      • New plants need an investment of around Rs 61,575 crore.
    • Price:
      • The price of imported urea in India is currently $370-403 per tonne.
      • Urea from domestic greenfield projects cost $493 per tonne. 
      • Thus it is cheaper to “buy” (import) than “make” urea in India. 
  • Arguments supporting “Make”:
    • Price:
      • After deducting the levies on the feedstock cost of domestic urea, the cost will come down to $427 per tonne.
    • Transportation:
      • The imported bulk urea arriving in vessels has to be discharged at the port, before bagging and reloading for dispatch to the consumption centres. 
      • Moving this urea to the northern and eastern hinterlands would involve an additional cost of $30-35/tonne.
      • That further narrows the gap between “buy” and “make”. 
    • Other Benefits:
      • Domestic production creates employment.
      • Boosts overall economic activity that accrues from Make-in-India, as compared to simply Import-into-India.

A different Atmanirbhar urea strategy of “making” more in Northern and Eastern India, while exploring greater “buy” options for Peninsular India can be done by the Government. This along with shutting down some of the older energy-inefficient plants and also curbing urea consumption can boost the urea industry while placing India on path to achieve its Panchamrit goals.

PM-KISAN: Highs and Lows

Context: The Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), which provides yearly income support of ₹6,000 to eligible farmer families in three installments, has been through highs and lows both in terms of coverage and payout.

Relevance of the topic:

Prelims: Questions regarding PM-KISAN scheme.

Mains: Analytical question on schemes, their impact, lacunae and suggestions.

About PM KISAN

  • Pradhan Mantri Kisan Samman Nidhi (PM KISAN) scheme launched in 2018 provides an annual income support of Rs. 6000/- to eligible farmers in three installments.
  • Intended beneficiaries:
    • Originally, landholding farmers having a farming area up to 2 hectares were eligible for the scheme (around 80% of farmers in India). 
    • Later, in 2019 the scheme was extended to all farmers who owned land, irrespective of the size of their landholdings. 
  • Expected outcomes from scheme: 
    • Income support: The scheme was intended to benefit 14.5 crore farmers by providing them income support of Rs. 6000 annually. 
    • Reduction in farm distress by creating a buffer for the farmers during negative externalities like drought and crop failure.
    • Poverty alleviation: As 22% of Below poverty line are farmers (Situation Assessment Survey), income support will reduce poverty burden on farmers.
    • Demonstrating commitment towards farmers' benefit and doubling farmer’s income.
image 116

Key Challenges in the Scheme Implementation

  • Does not address structural problems such as fragmentation of land holdings, higher dependence on monsoonal rainfall, poor marketing infrastructure (APMCs) etc. and hence, PM-KISAN is populist rather than reformist.
  • Promote Fragmentation of Landholdings: Farming households holding larger land parcels will try to split holdings to try to qualify for the benefits under the scheme.
  • Exclusionary: Excludes the landless agricultural workers, tenants, and sharecroppers.
  • Absence of land records may lead to exclusion of poor and vulnerable categories of farmers.
  • Inadequate financial support: The scheme offers Rs. 6000/- per annum to farmers equates to Rs. 17 per day per household that is substantially low to achieve goals like alleviation of farm poverty.
  • Under-utilised corpus: The fund allocated for the scheme was around Rs. 85000 crores but it remained under utilised since launch of scheme.  The scheme witnesses fluctuating beneficiaries, also the number is reducing from 2021-22 to 2023-24. 
  • Substandard than state schemes: Many state schemes like Telangana’s Rythu Bandhu and Odisha’s Kalia scheme provide better income support to farmers than the PM Kisan scheme, leading to limited enrollment of farmers.
image 117

Suggestive Measures for better Implementation

  • Increasing support amount: The scheme can explore increasing support to promote enrollment in the scheme on the lines of Rythu Bandhu and Kalia scheme of states.
  • Expand beneficiary coverage: Scheme should increase coverage by adding landless tenants with substantial proof of tenancy agreement in scheme.
  • Adding benefits: Apart from income support, the scheme can be drafted as an umbrella support extending to medical expenses, crop insurance and credit assurance scheme rationalising other schemes in PM KISAN.
  • Strengthening implementation: Digitisation of land records and using digital records for identification of beneficiary can improve impact of scheme at ground level.

Conclusion: The PM-KISAN scheme, while a significant step toward supporting small and marginal farmers, requires increased financial aid, broader beneficiary inclusion, and efficient implementation for maximum impact. With effective execution, it can reduce farmer distress, boost rural economies, and enhance agricultural productivity, fostering socio-economic development in India's agrarian landscape.

What is Climate Smart Agriculture?

Context: Natural farming is one of the key strategies to reduce input costs and the government is promoting this practice to encourage farmers to move to chemical-free agriculture as part of efforts to mitigate the adverse effects of climate change.

Relevance of the Topic:Mains: Climate-smart Agriculture- Need, Benefits, Strategies, Initiatives, Way Forward

About Climate Smart Agriculture

  • Climate-smart agriculture (CSA) is an approach that helps guide actions to transform agri-food systems towards green and climate resilient practices. 
  • Objectives: CSA aims to tackle three main objectives:
    • sustainably increasing agricultural productivity and incomes; 
    • adapting and building resilience to climate change; 
    • reducing and/or removing greenhouse gas emissions, where possible.
  • CSA supports the FAO Strategic Framework 2022-2031 based on the Four Betters:
    • better production
    • better nutrition
    • better environment 
    • better life for all, leaving no one behind. 
  • What constitutes a CSA practice is context-specific, depending on local socio-economic, environmental and climate change factors. 
image 103

Dimensions of Climate Smart Agriculture

  • Water-smart: Access to water for production, including:-
    • increasing the soil’s capacity to absorb and store moisture (green water)
    • rainwater harvesting and storage
    • wastewater reuse
    • supplementary small-scale irrigation.
  • Weather-smart:
    • Growing crops based on agro-ecological conditions
    • Use science and technology for creating climate resilient crops and seeds. 
    • Example: Drought resistant crops.
  • Energy-smart:
  • Carbon-smart practices:
    • Reduced or no-till farming practices help minimize soil disturbance, which can reduce the release of carbon dioxide (CO2) from the soil into the atmosphere.
    • Planting cover crops during periods when the main cash crop is not growing provides ground cover, prevents soil erosion, and enhances carbon sequestration.
    • Agroforestry and Organic farming practices, which avoid synthetic fertilizers and pesticides.

Need for Climate Smart Agriculture

  • Ensuring food security: Agriculture production should be increased by 60% to meet the food demand. 
  • Reduce yield loss: In India, crop yield decline owing to climate change (between 2010 and 2039) could be as high as 9%.
  • Enhance resource efficiency: CSA activity like no-tillage is advantageous for fertilizer management and can boost yield, nutrient usage efficiency, and profitability while lowering GHG emissions.
  • Meet SDG: UN’s SDG aims to end hunger and enhance environmental management.
    • CSA helps in achieving these goals through sustainable agriculture and rural development.
  • Combat climate change: CSA promotes crop diversification, increases water efficiency, and integrates drought-resistant crop types, all of which help lessen the disruptive effects of climate change.
  • Meet international obligation: Paris Agreement goal of limiting global warming by reducing GHG emissions is tied directly to the success of the CSA.
    • Agroforestry and carbon sequestration could help India meet its international obligations and contribute to the global fight against climate change.

Strategies to boost Climate-smart Agriculture

Govt. Initiatives to boost Climate Smart Agriculture: 

  • Cooperatives as a vital tool: Leveraging cooperatives in building climate-smart agriculture in rural India.
  • Role of NABARD: NABARD aims to build a more resilient and sustainable agricultural sector through:
    • data-driven solutions
    • new financial mechanisms, such as Agri Fund and the upcoming Carbon Fund
    • forming strategic partnerships with multilateral agencies and State governments
  • National Innovation on Climate Resilient Agriculture: aims to enhance resilience of Indian agriculture to climate change and climate vulnerability through strategic research and technology demonstration.
  • Pradhan Mantri Krishi Sinchayee Yojana: extending the coverage of irrigation (‘Har Khet ko pani’) and improving water use efficiency (‘More crop per drop’) in a focused manner.
  • Paramparagat Krishi Vikas Yojana: aims at supporting and promoting organic farming, in turn resulting in improvement of soil health.
  • Biotech-KISAN:
    • a scientist-farmer partnership scheme that empowers farmers, especially women farmers for agriculture innovation. 
    • It aims to understand the problems of water, soil, seed and market faced by the farmers and provide simple solutions to them.
  • Climate Smart Village: It is an institutional approach to test, implement, modify and promote Climate smart agriculture locally and enhance farmers’ abilities to adapt to climate change.

Way Forward

  • Promote Agro-ecological Practices: Encourage the adoption of biodiversity-enhancing and soil-friendly agro-ecological techniques.
  • Develop Resilient Crop Varieties: Invest in research and dissemination of climate-resistant crop varieties.
  • Improve Water Use Efficiency: Implement water-efficient irrigation systems and rainwater harvesting.
  • Optimise Livestock Management: Promote climate-resilient livestock practices and breeding for heat tolerance.
  • Enhance Weather Forecasting: Provide farmers with accurate and timely weather information for better planning.
  • Implement Conservation Agriculture: Advocate minimal soil disturbance, cover cropping, and crop rotation for soil health.
  • Integrate Agroforestry: Combine trees with crops and livestock for biodiversity and climate resilience.
  • Community-Based Adaptation: Involve local communities in developing and implementing climate adaptation strategies and provide training to farmers.
  • Financial Incentives: Implement policies offering financial support and incentives to access affordable, sustainable agricultural technologies.
  • Tap into the potential of Cooperatives to boost climate resilient agriculture in rural India.

Collective Farming: Empowering Small Farmers

Context: India’s agricultural landscape portrays a stark contrast between large landowners and small and marginal farmers. Holistic Collective Farming practices can bridge this divide.

Relevance of the topic:

Prelims: Collective Farming- Meaning, Features. 

Mains: Collective Farming- Benefits, Features, Need. 

What is Collective Farming?

  • Definition: Collective Farming is a system of agricultural production in which a group of farmers collectively owns and operates their farms as a collective farm.
  • Holistic collective farming aims to pool fragmented landholdings and empower small farmers through collective efforts.
  • Types: There are generally two types of collective farming:
    • Agricultural Cooperatives: Owned by members of the farm.
    • State Farms: owned by governments.
image 97

Need for Collective Farming in India:

  • As per the latest agricultural census (2015-16), the average land holding size in India is 1.08 hectares.
    • Land inheritance traditions have led to a steady reduction in farm sizes over generations. 
    • Small plots of land are insufficient to sustain a family. 
  • Without access to reliable water sources, quality seeds, or market knowledge, small and marginal farmers struggle to make ends meet. 
  • Many fall prey to moneylenders who charge exorbitant interest rates, pushing them deeper into debt. The result is a cycle of poverty and despair, which has contributed to India’s agricultural distress.
image 98

Features of Collective Farming:

  • Pooling Land: 
    • Farmers retain ownership of their land but agree to pool their plots into a collective unit.  This creates larger, contiguous areas for farming, which improves efficiency and scalability.
  • Collaborating with Social Entrepreneurs: 
    • A non-exploitative social entrepreneur provides initial capital, access to water resources, seeds, and marketing channels. 
    • They also bring in agricultural experts to train farmers in sustainable practices.
  • Natural Farming Techniques: 
    • Farmers are taught to prepare organic fertilizers using cow dung, cow urine, jaggery, lentil flour, and virgin soil. This is done to enhance soil fertility and reduce dependency on expensive chemical inputs.
  • Revenue Distribution: 
    • Farmers receive daily wages for their labour, ensuring financial stability. 
    • After the harvest, revenue from the sale of produce is distributed. 
    • Operational expenses are deducted, and the remaining profits are shared among farmers based on their land contribution.
image 99

Benefits of Collective Farming:

  • Economic stability: By earning both wages and profit shares, farmers experience immediate and long-term financial benefits.
  • Sustainability: Natural farming practices improve soil health and reduce environmental harm, creating a sustainable agricultural system.
  • Social Empowerment: Collective farming fosters community cooperation, reduces dependence on moneylenders, and gives farmers greater bargaining power in markets.
  • Prevention of Land Fragmentation: Joint ownership through a pooled model halts the physical division of land, ensuring its viability for future generations.

Steps to promote Collective Farming in India

  • Financial incentives, such as subsidies for natural farming inputs or tax benefits for social entrepreneurs, could accelerate adoption.
  • Development of Aggregating apps to aggregate agri-mechanised inputs on rental basis. This would enable mechanisation of farms in the collective farming model. 
  • Ease of financing: Like KCC, procedures to avail term loan may be simplified with minimum documentation. Capacity building of bank staff dealing with agriculture term loan products may be ensured.

The holistic collective farming model is not just an economic initiative; it is a vision for social transformation. By integrating traditional knowledge with modern sustainability practices, it offers a way to rejuvenate India’s farming sector.

Farmer ID

Context: The Ministry of Agriculture and Farmers’ Welfare (MoA&FW) has made Farmer ID mandatory for new applicants to enrol into the Pradhan Mantri Kisan Samman Nidhi (PM-Kisan) and get benefits under the scheme. The farmer ID guarantees that the applicant-farmer owns the land, and thus the PM-KISAN registration process would be vastly simplified.

Relevance of the Topic: Prelims- Farmer ID, Digital Agriculture Mission, Agristack, PM-KISAN Scheme.

What is a Farmer ID?

  • Farmer ID (also known as Kisan Pehchaan Patra) is an Aadhaar-linked Unique Digital Identity of the farmers.
  • Created and maintained by: State Governments/ Union Territories.
  • The IDs will be linked to various farmer-related data including:
  • The database created through the Farmer ID will be known as Farmer’ registry. It is one of the three registries under Agri Stack component of the Centre’s Digital Agriculture Mission for creation of digital public infrastructure in the farm sector.

Benefits of Farmer ID: 

  • Targeted delivery: Only legitimate and eligible farmers receive subsidies and benefits and eliminates duplication in government schemes.
  • Precision agriculture: Facilitates data-driven policy-making for better crop planning, insurance, and market linkages.
  • Empowerment of farmers: Encourages financial inclusion by enabling easy access to credit and crop insurance.
Farmer ID - kisan ki pehchaan

About AgriStack:

  • AgriStack is designed as a farmer-centric Digital Public Infrastructure (DPI) to streamline services and scheme delivery to farmers. It comprises three key components:
    • Farmers' Registry
    • Geo-referenced village maps
    • Crop Sown Registry
  • The AgriStack is a part of the Digital Agriculture Mission (2021–2025) which aims at modernisation of Indian agriculture. The three DPIs to be built under the Mission are Agristack, Krishi Decision Support System, and Soil Profile Mapping. 

Key targets of AgriStack include:

  • Creating digital identities for 11 crore farmers over three years (6 crore in FY 2024-25, 3 crore in FY 2025-26, and 2 crore in FY 2026-27).
  • Launching the Digital Crop Survey nationwide, within two years, covering 400 districts in FY 2024-25 and all districts in FY 2025-26.

What is the PM KISAN scheme?

  • The Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme is a Central Sector Direct Benefit Transfer (DBT) Scheme, under which, financial assistance of Rs.6000/- per annum is provided to all landholding farmer families across the country, subject to certain exclusion criteria relating to higher income strata.
  • Objective: To enable them to take care of expenses related to agriculture and allied activities as well as domestic needs.  
  • The amount is transferred in three 4-monthly installments of Rs. 2000/- each, directly into the bank accounts of the beneficiary farmers identified by the State/UT Governments.
  • Eligibility: Extended to all farmer families irrespective of the size of their landholdings. (Originally, landholding farmers having a farming area up to 2 hectares were eligible for the scheme).
  • Exclusions: 
    • Farmer families who pay income tax, with government employees and professionals like doctors etc. are excluded.
    • Former and current constitutional officeholders.
    • Previous and current Ministers/State Ministers, MPs/MLAs/SLCs/ Mayors former and present District Panchayat Chairpersons.
    • All serving or former officials and workers of Central/State Government Ministries/Offices/Departments and their field units.
    • All superannuated/retired pensioners whose monthly pension is Rs.10,000/- or higher (excluding Multi-Tasking Staff / Class IV/Group D employees).
  • Recently, a Parliamentary panel has recommended doubling the yearly payouts under the PM-Kisan to Rs 12,000 per annum from the present Rs 6,000.

Needs of Indian Agriculture Sector 

Context: Agriculture plays a significant role in India’s economic growth. However, India needs a robust and sustainable agricultural sector in the backdrop of climate change, high food inflation, low agricultural income and the vulnerable situation of the farmers. 

Relevance of the Topic: Mains: Analytical questions on the state of Indian Agriculture. 

Key aspects of Indian Agriculture Sector

  • In FY 2023-24, the share of agriculture in overall Gross Value Added (GVA) at current prices was 17.7%.
    • The share of agriculture in total Gross Value Added (GVA) of the economy has declined from 35% in 1990-91 to 15% in 2022-23.
  • 82% farmers in India are small and marginal in nature i.e., farmers with less than 2 hectare of land.
  • Disguised Unemployment: Indian agriculture is plagued with disguised unemployment where 49% of the workforce is engaged to contribute 17% in GVA.
  • Farm Poverty: Among the population who live below the poverty line, 22% are farmers, as per the situation assessment survey.
  • Monsoon Dependency: Over 52% of arable land is dependent on monsoon and does not have access to Irrigation.
  • Feminisation of Agriculture: Indian agriculture is dominated by the female laborers, as per Oxfam’s report 80% of Agriculture laborers are women.
  • Declining wages: The Periodic Labour Force Survey (PLFS) shows that real wages in rural areas (including farm wages) have stagnated and even marginally declined in the last five years.
image 51

Challenges and Reforms

Following are the various challenges in making agriculture sustainable and reforms needed to improve the condition of agriculture in India.

AspectChallengesReforms
Minimum Support Price (MSP)The existing MSP is limited in scope leading to discrepancies among crops and regions.Transition to a more inclusive system by considering crop diversification and extent of agriculture poverty across various regions. E.g., Swaminathan committees C2 method.
Agriculture SubsidiesSubsidies are more tilted towards populism instead of capital investment.Rationalising the subsidies by eliminating indirect subsidies in the system with Direct benefit transfer to farmers under PM-FASAL scheme.
Fertilizers and InputsPrices of the fertilisers are regulated and are unrevised since 2012. This leads to over exploitation of inputs deteriorating productivity.Deregulating the prices of fertilisers and providing DBT benefits instead of price subsidies.
Farmer Producer OrganisationsFPOs are struggling with limited price discoveries and politicisation. Focusing on democratisation of FPO and integrating them with Food processing industries for better price discovery.
Research and DevelopmentIndia’s agricultural research and development expenditure has remained low (around  0.6% of its agricultural GDP).Taking investment in agriculture R&D to 2% or more and organising hackathons for more gender neutral and easy to use equipment for farmers.
Climate Change Changing weather patterns with extended heat and disrupted monsoon reduces productivity. E.g., 2024 was 0.9 degrees hotter than previous years causing crop failure in India.Use of satellite technology to suggest the crops and sowing period to farmers on the basis of climate predictions.
Credit AssuranceHorticulture and agriculture allied sectors face challenges in adequate credit access and insurance over their produce.Shift from the crop insurance to agriculture insurance by extending insurance facilities to the agriculture-allied activities.
Agriculture ExtensionLimited access of farmers to agriculture extension activities.Promoting training and digital literacy along with the training to youth in rural regions. E.g., Attracting and Retaining Youth in Agriculture (ARYA) scheme 

Conclusion: Implementing these reforms could lead to a more resilient and prosperous agricultural sector, ensuring food security and improved livelihoods for farmers across India.

Trending now

Captagon
B’nei Menashe: Identity, Migration, and the “Lost Tribes” Debate
Bauxite Mining Conflict in Odisha
Impact of Rising Energy Costs on Migrant Labourers