Date: 4th January, 2016

Dear Shri Jaitley Ji

Bharat Krishak Samaj is a non-partisan association of farmers advocating the crucial need for India to focus on farmer prosperity.

A bad monsoon and low international commodity prices have aggravated the misery of the farmers. Lots of measures are required to revive the rural economy. Considering the political acrimony, it would be prudent to avoid contentious issues.

Creating capacity and self-sustainability of family farms and the nation to withstand inconsistencies of nature and trade must be a priority. Our suggestions for pre-budget 2016 consultation are as follows:

  1. Increased outlays for agriculture to be higher than 2014-15.
  2. Target 2% expenditure on agriculture R&D of agri. GDP over the next few years.
  3. Revive agriculture extension. Announce a 5 year plan to appoint one agriculture graduate as extension worker for every ten villages; create 60,000 jobs.
  4. 10 times increased funding for data collection & assessment.
  5. Fund repair & maintenance of all existing irrigation projects. Provide drainage for existing irrigated areas. Don’t fund new flood irrigation projects.
  6. Increase outlay for Watershed Management subsumed under Pradhan Mantri Krishi Sichai Yojana by 10 times for drought prone rain-fed area development.
  7. Fund 1 million small water storage reservoirs & distribution of soil moisture measuring sensors to all farmers.
  8. Increase outlay for Micro Irrigation Systems subsumed under Pradhan Mantri Krishi Sichai Yojana by 10 times & accord it infrastructure lending status.
  9. Incentivize balanced use of fertilizers; increase urea price & simultaneously decrease price of P&K fertilizers, so no added burden is imposed on the farmers or the government.
  10. De-canalize import of fertilizers.
  11. Crude oil prices will not remain low for long. To reduce fertilizer subsidies fund to contract for long term gas supplies in countries like Iran or Qatar to manufacture urea. Farmer cooperatives like IFFCO & KRIBHCO have successfully installed urea manufacturing facilities in Oman – must be asked to set up such new units.
  12. Start a ‘Sugarcane Development Board’ like National Horticulture Board.
  13. Emphasis on “Agro Forestry” for income generation.
  14. Animal husbandry sector funding must reflect priorities for preventive measures as is being delivered by NDDB and AMUL rather than target to cure disease.
  15. Fund Gaushala’s with the condition; 40% of total animals in their keep be male cattle.
  16. More incentives for Bio gas units without restricting incentives for electricity generation.
  17. Solar water pumps be incentivized irrespective of capacity.
  18. Allow unrestricted import of agriculture machinery (excluding tractors) at 0%duty.
  19. Incentivize leasing of farm machinery through collective ownership. Give interest free loans to cooperative societies / farmer producer organizations to purchase farm machinery repayable over 3 years.
  20. Paramparagat Krishi Vikas Yojana promotes organic farming. Increase outlay by ten times with specific incentives to increase crop diversity in individual farms.
  21. Initially, target to replace chemical use in farms by 10%.
  22. Funding to set-up laboratories to test for sub-standard & spurious pesticides. Additionally, fund laboratories to check fresh & processed food imports.
  23. No restrictions on export of agriculture produce. Need long term Agriculture Exim policy. Charge maximum permissible import duties on fresh farm produce.
  24. Delivering remunerative prices to farmers is a must and ‘Price Deficiency Payment Mechanism’ as also envisaged by “An Occasional Paper of NITI Aayog” must begin.
  25. Increase outlay for ‘Market Intervention Scheme’ & ‘Price Stabilization Fund’.
  26. Fund to increase the number of agriculture market yards ‘Mandi’ by 50% & provide full infrastructure in all existing agriculture market yards.
  27. When funding urban renewal or smart cities, make it mandatory for cities to allocate space for farmer markets in residential areas based on population density.
  28. Double investments on Farmer Producer Organizations.
  29. Double number of farmers receiving loans of up-to rupees two lacs & for that charge 1% interest only. Link Aadhar to such loans accounts to avoid duplication. Subvention is not helping, do away with it.
  30. Institutional credit is not reaching small farmers. Announce corrective measures. Order a CAG audit of agriculture credit lending portfolio of public sector banks.
  31. Land leasing through mechanisms like the “Licensed Cultivators’ Act” in A.P. and Telangana is working as is Bhoomiheen Kisan Credit scheme. A Guarantee Fund be set up to increase the bankers’ confidence in lending to non-land owning “licensed” cultivators, both as individual farmers and in Joint Liability Groups. 5000 crore rupees set aside for the purpose.
  32. More funds for Indian metrological department specifically for improving medium term weather forecasts for agriculture.
  33. Move to a regime of risk mitigation measures where government pays 75% premium for weather & price insurance for all crops.
  34. Natural Disasters affecting farmers are now annual events though occurring in different locations. Substantially, increase funding for SDRF/NDRF.

Transforming the farm sector will require more than a niyat, it requires a niti where the fine print has the farmers’ consensus. Should you require clarifications, please feel free to call for me.

With warm regards.
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Shri Arun Jaitley,
Hon’ble Minister of Finance,
Govt. of India
North Block, New Delhi-110001