Andhra government fails to present much-hyped agriculture budget

It presents only an action plan for agriculture; Rs 25,962 crore earmarked for agriculture and allied sectors

By M Suchitra
Published: Wednesday 20 March 2013

For the past few weeks, the Congress-led Kiran Kumar Reddy government in Andhra Pradesh has been highlighting its commitment to farmers by hyping “the first ever agriculture budget in the history of the state”. The agriculture budget was to be presented along with the state’s budget for the coming fiscal year. But the much-hyped separate budget turned out to be a damp squib. On March 18, the day of the budget announcement, the state agriculture minister Kanna Lakshminarayana, could only present an action plan for agriculture and its allied sectors.

Interestingly, the presentation of a separate budget was not even included in the agenda for the day. The reason: the government forgot to inform the Business Advisory Committee (BAC) of the state Legislative Assembly. It also failed to officially inform the speaker of the Assembly, the legislative council chairperson and the legislative secretariat that a separate budget was going to be presented. “It was our mistake. We failed to follow some procedures,” explained finance minister Anam Ramanarayana Reddy. At the last moment, the word “budget” had to be dropped and instead "action plan" was incorporated. To top it all, the finance minister said it was mistakenly printed as “agriculture budget speech 2013-14” while it was actually a presentation of “agriculture action plan” for 2013-14. 

24 per cent increase in outlay

The action plan earmarked Rs 25,962 crore for agriculture, irrigation, groundwater, forest, horticulture, sericulture, animal husbandry, fisheries, food processing and marketing, and warehousing. Together with these proposed budgetary allocations, an amount of Rs 72,450 crore is planned under agricultural credit plan. This makes the total investment for the farm sector Rs 98,940.54 crore compared to Rs 79,924.78 crore in the current fiscal – a 24 per cent increase in outlay. 

The agriculture minister has announced a Rs 100 crore fund for market intervention to ensure minimum support price for crops such as paddy, jowar, maize, ragi and pulses, and another Rs 590-crore Natural Calamities Fund to provide farmers immediate relief in times of distress. The other major allocation is for power for the agriculture sector. The government will provide Rs 3,622 crore to power distribution companies towards power subsidy. 

According to the agriculture minister, this “concerted and synergetic effort” was envisaged since more than half of the population depended on agriculture. Even as agriculture continued to be a major source of livelihood, it often faced a crisis, he said. “It was linked to several departments but lacked convergence. The action plan will ensure close coordination among various departments, address production and post-production problems, and cost-effectiveness in the technological interventions,” said the minister. 

Irrigation budget downsized

Irrigation is a highly critical and prioritized sector in the state, where more than half of the cultivated area is rain-fed. The government had launched a Rs 1,86,000 crore project called Jalayagnam in 2005 with 86 major and medium irrigation projects under it. These projects are highlighted as the permanent solution for the water woes of the farmers, especially those in the perennially parched Rayalaseema and Telangana regions of the state. The irrigation department has a target to finish at least 50 projects by 2014. It has asked for a sum of Rs 39,000 crore as budgetary allocation. 

But the allocation for irrigation has been downsized. The sector got only Rs 13,800 crore for 2013-14, which is Rs 1,210 crore less than the 2012-13 outlay. In the current fiscal year, the outlay for irrigation was Rs 15,010 crore. Since 2005 there has been a 5 to 10 per cent hike in the annual outlay for irrigation, and for the last three fiscal years the allocation was around Rs 15,000 crore. 

The explanation given by the finance minister for this downsizing was the failure of the irrigation department to spend the allotted amount in the current fiscal. The department could spend only Rs 8,000 crore against the allocated amount of Rs 15,010 crore. Besides, according to the agriculture minister, the state government hopes the Centre will give national status to two giant irrigation projects—Pranahita Chevella Lift Irrigation Scheme and the Indira Sagar Polavaram Project. 

Opposition parties to grill government

In the run-up to elections in 2014, opposition parties are trying to cash in on the agriculture budget fiasco. The main opposition parties in the state – the Telugu Desam Party (TDP), YSR Congress and the Left parties – are all united and set to corner the government over the issue of the agriculture budget in the ongoing Assembly session. They have accused the government of misleading the state assembly and the people. The government is defensive. The chief minister has asked the officials to replace the word “budget” in all related documents with “Action Plan”.

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