In the Union Budget of 2025-26, the Finance Minister announced agriculture sector to be the first engine of growth. The Budget for FY25-26 outlined key measures aimed at boosting India's agricultural sector, ensuring food security, and supporting the rural economy. The FM proposed specific programmes to facilitate the growth of the sector.
Key budget announcements:
Agri-District programmes:
The government announced the ‘Prime Minister Dhan-Dhaanya Krishi Yojana’ in partnership with states. Through the convergence of existing schemes and specialized measures, the programme will cover 100 districts with low productivity, moderate crop intensity and below-average credit parameters.
It aims to enhance agricultural productivity, adopt crop diversification and sustainable agriculture practices, augment post-harvest storage at the panchayat and block level, improve irrigation facilities, and facilitate availability of long-term and short-term credit. This programme is likely to help 1.7 crore farmers.
A comprehensive multi-sectoral ‘Rural Prosperity and Resilience’ programme will be launched in partnership with states. This will address 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. Global and domestic best practices will be incorporated and appropriate technical and financial assistance will be sought from multilateral development banks.
In Phase-1, 100 developing agri-districts will be covered, according to the FM.
Focus on pulses:
The government has decided to launch a 6-year “Mission for Aatmanirbharta in Pulses” with a special focus on Tur, Urad and Masoor. Central agencies (NAFED and NCCF) will be ready to procure these 3 pulses, as much as offered during the next 4 years from farmers who register with these agencies and enter into agreements.
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.
A Makhana Board will be established in the state to improve production, processing, value addition, and marketing of makhana. The people engaged in these activities will be organized into FPOs. The Board will provide handholding and training support to makhana farmers and will also work to ensure they receive the benefits of all relevant Government schemes.
National Mission for High Yielding Seeds:
A National Mission on High Yielding Seeds will be launched, aimed at strengthening the research ecosystem, targeted development and propagation of seeds with high yield, pest resistance and climate resilience, and commercial availability of more than 100 seed varieties released since July 2024.
KCC enhancement:
Kisan Credit Cards (KCC) facilitates short term loans for 7.7 crore farmers, fishermen, and dairy farmers. The loan limit under the Modified Interest Subvention Scheme will be enhanced from 3 lakh to 5 lakh for loans taken through the KCC.
Mission for Cotton productivity:
The government announced a ‘Mission for Cotton Productivity’. This 5-year mission will facilitate significant improvements in productivity and sustainability of cotton farming, and promote extra-long staple cotton varieties. The best of science & technology support will be provided to farmers. Aligned with the integrated 5F vision for the textile sector, this will help in increasing incomes of the farmers, and ensure a steady supply of quality cotton for rejuvenating India’s traditional textile sector.
Outlook:
The heavy emphasis on agriculture as the “first engine of growth” is a decisive step towards strengthening India's food and agri-sector. Access to higher credit will enable farmers to invest in better cattle nutrition, advanced milking technology, and cold-chain infrastructure critical for the sector. It seems that the recent spike in food price inflation is pushing the government towards a highly compressive strategy aiming at higher production and reduction in wastage.