Union Budget 2026-Agriculture: Big Vision, Limited Immediate Relief

The Union Budget 2026 projects a “Big Vision” for agriculture but offers limited immediate relief to farmers grappling with current hardships.

The Disconnect: Immediate Needs vs Long-term Vision

• Delayed Payoffs: Unlike industry or taxpayers, farmers cannot immediately assess budgetary gains, as most announcements target long-term outcomes.
• Persisting Income Distress: Rising input costs, price volatility, and declining profitability continue, with limited short-term relief in the 2026 Budget.
• Policy Tension: The challenge lies in balancing structural agricultural transformation with immediate income support.

The “Big Vision”- Productivity and Sustainability

• Crop Shift Strategy: Promotion of high-value crops such as coconut, cashew, and sandalwood to enhance income while reducing water and fertilizer dependence.
• Technology-Driven Agriculture: Emphasis on AI-enabled farming, GIS-based precision agriculture, and field-specific interventions to raise productivity.
• Global Alignment: Digital agriculture is essential to align Indian farming with global technological standards.
• Environmental Rationale: Gradual shift away from water-intensive cereals to address soil degradation and resource depletion.

The Challenge of Crop Diversification

• Incentive Deficit: Farmers adopt diversification only when they are assured of stable, higher incomes.
• MSP–Procurement Mismatch: Although MSP is announced for around 24 crops, effective procurement remains concentrated on rice and wheat.
• Market Vulnerability: Growers of pulses, oilseeds, and nutri-cereals face price exploitation due to a lack of assured procurement mechanisms.

Structural Constraints for Small and Marginal Farmers

• Exposure to Volatility: Transition to horticulture or high-value crops requires risk mitigation and market stability.
• Cost–Price Squeeze: Rising cultivation costs are not matched by commensurate farm-gate prices.
• Infrastructure Gaps: The absence of robust, immediate procurement and marketing infrastructure limits farmers’ confidence.

Way Forward

• Market Intervention Scheme (MIS): Use MIS more proactively to stabilise prices of horticulture and market-oriented crops.
  • MIS is a price support scheme implemented by the Government of India to protect farmers from distress sales of perishable agricultural commodities (mainly fruits and vegetables).
• Decentralised Procurement: Promote localised procurement models to reduce transport costs and increase farmer realisation.
• Credible Market Assurance: Extend assured procurement beyond wheat and rice to incentivise sustainable crop diversification.

Conclusion

The 2026 Budget articulates a strong long-term vision for sustainable, technology-driven agriculture, but falls short on immediate income security. Bridging this gap through assured markets and decentralised procurement is crucial to make structural reforms credible for farmers.

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