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India's Union Budget 2026: Focus on Agriculture & Rural Development

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  Published in Business and Finance on Friday, January 30th 2026 at 9:36 GMT by Business Today
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New Delhi, January 30th, 2026 - As India gears up for the presentation of the Union Budget 2026, all eyes are on the government's commitment to the agricultural sector and rural development. Experts predict a continued prioritization of farmer welfare, increased rural employment, and a robust investment in agricultural infrastructure. The coming budget is expected to build upon existing schemes and introduce new measures aimed at bolstering farm incomes and fostering a more sustainable and resilient agricultural landscape.

Building on Existing Foundations: Key Scheme Allocations

The success of schemes like the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), which provides direct income support to farmers, is widely acknowledged. Industry analysts anticipate a significant increase in the allocation for PM-KISAN, acknowledging its crucial role in stabilizing farmer incomes, particularly for small and marginal landholders. Similarly, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), a vital source of rural employment, is expected to receive increased funding to address rural distress and create livelihoods. The Agricultural Infrastructure Fund (AIF), designed to bolster post-harvest infrastructure, is also poised for increased allocations, recognizing the critical need to reduce wastage and improve supply chain efficiency.

"The government understands that sustained investment in these foundational schemes is paramount," explains Dr. Anya Sharma, a senior economist specializing in agricultural policy. "PM-KISAN provides a safety net, MGNREGA ensures employment, and AIF addresses systemic inefficiencies. Expanding these programs will be essential for achieving long-term agricultural growth."

The Quest for Higher Farmer Incomes: Diversification and Value Addition

Beyond direct income support, the budget is expected to outline strategies for enhancing farmer incomes through diversification and value addition. This includes incentives for farmers to shift towards more profitable crops, coupled with support for processing and packaging facilities. Experts believe the budget will encourage investment in technologies that enable farmers to add value to their produce, such as food processing units and cold storage facilities in rural areas. Improved market access is also a key focus, with potential initiatives to strengthen rural road networks and facilitate direct linkages between farmers and consumers.

Reducing input costs remains a crucial element. Continued subsidies on essential inputs like fertilizers and seeds are anticipated, although there's a growing call for targeted subsidies that prioritize efficient and sustainable farming practices. The budget may also explore innovative financing mechanisms to make credit more accessible to farmers at lower interest rates.

Sustainable Agriculture: Adapting to a Changing Climate

Recognizing the escalating threat of climate change, the budget is expected to prioritize sustainable agriculture practices. This includes promoting organic farming, water conservation techniques like micro-irrigation, and crop diversification to enhance resilience to extreme weather events. Financial assistance and incentives for farmers adopting these practices are highly anticipated. The budget might also include provisions for research and development in climate-resilient crop varieties and innovative farming technologies. A shift towards agroforestry and integrated farming systems is also likely to be encouraged.

Strengthening Infrastructure: Irrigation and Beyond

Improving irrigation infrastructure is considered essential for enhancing agricultural productivity, especially in rain-fed areas. The budget is expected to announce further investments in completing ongoing irrigation projects and developing new infrastructure, including water storage facilities and efficient water distribution networks. However, experts emphasize the need to move beyond traditional irrigation methods and embrace water-efficient technologies like drip irrigation and sprinkler systems. Additionally, bolstering storage facilities, cold chains, and transportation networks will be critical for minimizing post-harvest losses and ensuring a smooth agricultural supply chain.

Empowering Rural Livelihoods: Entrepreneurship and Skill Development

The budget will likely address the need to strengthen rural livelihoods beyond agriculture. This includes promoting rural entrepreneurship through initiatives like micro-enterprise development programs and providing access to credit for rural businesses. Skill development programs tailored to the needs of the rural economy are also expected, focusing on areas like agro-processing, food safety, and sustainable farming techniques. This holistic approach aims to create diversified income opportunities and improve the overall quality of life in rural communities.