Budget 2026-27 shifts focus to high-value crops but vegetables, fruits sidelined

The government has placed an emphasis on high-value crops like coconut, cocoa, cashew and sandalwood, instead of food grains, with ‘support for high-value agriculture’ receiving an allocation of Rs 350 crore in the Union Budget 2026-27.

High-value agriculture is being seen as one of the top priorities for improving farmer incomes. In her budget speech on February 1, 2026, Union Finance Minister Nirmala Sitharaman announced that the government will support high-value crops in coastal areas, Agar trees in the North-East region and nuts such as almonds, walnuts and pine nuts in the hilly regions, for diversifying farm outputs, increasing productivity, enhancing farmers’ incomes and creating new employment opportunities. 

But this high-value agriculture has been reduced to just plantation crops, while other high-value crops like vegetables, fruits and even spices have not found any mention. 

The horticulture sector accounts for around 33 per cent of agricultural gross value added. In 2024-25, horticulture production reached 362.08 metric tonnes (MT), surpassing the estimated food grain production of 329.68 MT. 

"The contribution of horticultural crops (especially fruits and vegetables) has been going up in agricultural GDP and its growth and in increasing farmer incomes. Moreover, there are many high-value crops like fruits, vegetables and spices that are a part of high value crop agriculture, besides plantation crops like cardamom, coffee and tea. But, there is complete silence on these crops with only coconut and cocoa being focused,” said Sukhpal Singh, professor and former chairperson, Centre for Management in Agriculture, Indian Institute of Management, Ahmedabad.

Boost for coconut sector

Special attention has been given to the coconut sector, with Sitharaman proposing a ‘Coconut Promotion Scheme’ for enhancing competitiveness in coconut production by increasing productivity and other interventions like replacing old and non-productive trees with new saplings / plants / varieties in major coconut growing states.

“India is the world’s largest producer of coconuts. About 30 million people, including nearly 10 million farmers, depend on coconuts for their livelihood,” Sitharaman said.

Further, a dedicated programme for Indian cashew and cocoa to make India self-reliant in raw cashew and cocoa production was also proposed.

On sandalwood, the government announced that it will partner will state governments to promote focused cultivation and post-harvest processing.