Good News for Farmers! As per official sources, the Central government is likely to increase the payout to farmers under PM Kisan Yojana in the upcoming budget to Rs 8000 per year from Rs 6000 per annum. Finance Minister Nirmala Sitharaman will present the Union Budget 2022-23 on 1 February.
The budget allocation to the farm sector will be made in the backdrop of the repeal of the 3 agriculture laws and the upcoming elections in 5 states — Punjab, Uttar Pradesh, Uttarakhand, Goa & Manipur. Sources informed that several policy measures benefiting farmers are expected to be announced in the budget 2022 as the farming community had faced lots of difficulties due to ongoing pandemic.
It is expected that the allocation under Government’s most ambitious scheme – Pradhan Mantri Kisan Samman Nidhi Yojana, which benefits more than 10 crore farmers will be increased from Rs 65,000 crore in the last budget.
Besides, Finance Minister Nirmala Sitharaman can also announce the setting up of a panel on minimum support price (MSP) for all crops, the main demand of the protesting farmers. It must be noted that Prime Minister Narendra Modi, while repealing the farm laws, had announced a committee on MSP.
The budget announcement will give it more credibility. According to analysts, such announcements will not violate the model code of conduct for the elections as they are not targeted to a particular state.
Credit Target for FY2022-23
Sources further told that the Modi government was likely to increase the farm credit target to about Rs 18 lakh crore in the budget. For the current financial year, the Centre has set a credit target of Rs. 16.5 lakh crore.
The Centre decides annual agriculture credit that includes crop loan targets for the banking sector. The agricultural credit flow has gone up consistently over the years, exceeding the target set for every fiscal.
The government is offering a 2% interest subsidy to make sure farmers get short-term loans of up to Rs 3 lakh at an effective rate of 7% per annum. An extra incentive of 3% is given to the farmers for quick repayment of loans within the due date, making the effective interest rate 4%.
The Modi government may increase the interest subsidy and also additional incentives to ensure the timely payment of the loans.
