Finance Minister Nirmala Sitharaman Announces Various Reforms to Reinforce the Agricultural Sector and MSMEs in India

On May 12th, Prime Minister Narendra Modi addressed the nation and mentioned a programme “Vocal for Local” and announced an economic package of 20 lakh crores in his address. In an attempt to push this programme Finance Minister Nirmala Sitharaman declared a congregation of procedures and actions to be emphasised in the third tranche of the economic stimulus.

After setting forth the assistance for the migrant workers, street vendors and small farmers, Finance Minister, yesterday, has announced some major reforms that are definitely going to help the agricultural sector, allied activities like dairy, animal husbandry, fisheries and MSEs (Micro food enterprises). 

Funding in the agricultural sector and micro food enterprises 

The finance minister announced that one lakh crore will be providing for the solidification of the farm-gate infrastructure for farmers. This funding will focus on various infrastructure projects, agricultural entrepreneurs, primary agriculture cooperative society etc. She said that this fund will be used for setting up cold chains and post-harvest management infrastructure.

Also, a fund of Rs 10,000 crores will be allocated for the reinforcement of micro food enterprises (MFEs). The minister put the focus on the cluster-based approach to stimulate the state-wise produce. She said that a different cluster of nutritional foods to be formed in different states and areas of India is one of the significant ways to boost production of alimentary foods.

The importance of nutrition and the cluster-based approach

Keeping in view the importance of nutrition and consumption of healthy food, both the combination of the fund and the cluster-based approach will help in disseminating these products in untapped markets which in turn help the people to get the best of sustenance. The cluster-based approach will be focussing on specific organic, nutritional and herbal foodstuff in which the areas or states of India has the maximum and greatest strength.

Sitharaman explained by giving examples and say, makhana is one of the wholesome and nourishing foods that do not contain any calories and can easily be consumed as a snack and Bihar accounts for one of its largest production, so cluster formed in Bihar will be of Makhana. Kashmir would focus on Kesar cluster. Ragi and coarse grain are known to be one of the healthiest food staples which are gluten-free and Karnataka can focus on the cluster of such healthy grains. Organic fruits and bamboo shoots is a necessity these days and fruits are filled with essential nutrients and therefore Northeast can focus on the cluster of such healthy food staples. Turmeric latte has gained much momentum outside in recent years due to the potent health benefits of golden turmeric so Telangana can form turmeric cluster. Similarly, Andhra Pradesh can form the cluster of chillies and Tamil Nadu can focus on the cluster of tapioca.

The role of funding and introduction of schemes

The allocation of funding will improve the unorganised MFE units and advance their requirement of technical up-gradation to reach and accomplish the food standards of FSSAI. Further, Sitharaman declared that to assist 2 lakh MFEs and to attain aforesaid goals, a scheme will soon be launched. The finance minister also that better health and overall well-being with proper safe and sound ways, integration with retailers and market places and enhanced revenues are the areas to be focussed.

Further, the government has introduced ‘TOP to TOTAL’ scheme that solely focuses on the overhaul of supply chains that got disturbed due to the lockdown induced to tackle coronavirus. The Finance minister said, “this scheme will provide various subsidies like 50% on transportation of goods from surplus to deficient markets; 50% subsidy on storage, including cold storages.”

Footnote

The huge announcement of fund allocation for Micro Food enterprise by the finance minister is a great way to help the agricultural section and various MSMEs that have been interrupted by the tide of the coronavirus crisis and to deliver therapeutic nutrition to all the public.