India will focus on strengthening its rural and agricultural economy in the coming fiscal year, Finance Minister Arun Jaitley said on Thursday.
Jaitley is presenting his fifth annual budget to lawmakers in New Delhi. This budget assumes more importance that usual because of a general election next year.
“We have taken up programs to direct the benefits of structural reforms and good growth to reach the farmers, poor and other vulnerable sections of our society, to uplift the underdeveloped regions,” Jaitley said in his opening remarks to the Indian Parliament.
“This year’s budget will consolidate these gains and particularly focus on strengthening agriculture and rural economy,” he said.
The finance minister added that the government will concentrate on the “provision for good health to economically less privileged, taking care of senior citizens, infrastructure creation and working with the states to provide more resources for improving the quality of education in the country.”
Jaitley also said that in the second half of the ongoing fiscal 2018 that ends Mar. 31, India expects to grow between 7.2 to 7.5 percent. “We are now firmly on course to achieve a high growth of 8 percent plus,” Jaitley added, but he did not indicate a timeline by when that number would be reached.
Prior to Thursday’s announcement, economists broadly expected measures focused on India’s rural sector. One market watcher said the “malaise” among farmers ran deep following two years of drought that bit into profits.
Last year, Prime Minister Narendra Modi’s Bharatiya Janata Party won the local elections in his home state of Gujarat but lost its footing among the state’s rural population. In a recent interview, Modi said it was a priority for the government to help distressed farmers.
That led many to speculate that the budget would be aimed at winning back rural voters ahead of the next general election.
“My government is committed to the welfare of the farmers,” Jaitley told the parliament on Thursday. “For decades, the country’s agricultural policy and programs has remained production-centric.”
He added that the Modi government wanted to double farmers’ income by 2022 when India celebrates its 75th year of independence.
“Our emphasis is on generating higher incomes for farmers. We consider agriculture as an enterprise and want to help the farmers to produce more from the same land parcel at lesser cost and simultaneously realize higher prices for their produce,” Jaitley said.
He added there’d be an emphasis on generating productive and gainful employment for farmers and landless families.
The minimum support price for all crops would be increased to at least 1.5 times that of the production cost, Jaitley announced. That is the level at which the government would buy crops from farmers, regardless of the market price.
This is a breaking news story. Check back for updates.
