Sadly the Union Finance Minister P Chidambaram’s Budget this year has missed the necessary qualifications of a good Budget. With polls ahead in 2014, he has simply played the game of allocation of funds and brought them to focus in his Budget speech, particularly in those sectors that concern the common man.

He brought sectors like Scheduled Castes, Scheduled Tribes, women and children and the minority communities at the centre stage in his Budget speech. The sub-plans for Scheduled Castes and Scheduled Tribes were formulated at the instance the guidelines issued by the Planning Commission and accordingly fund allocations were being made since 2011-12. What Chidambarm did was just to hike the allocation which was needed to cope with the price inflation trend.

The total allocation to the Scheduled Caste sub-plan, spreading across different ministries and departments has been hiked to Rs 41561.13 crore from the budgetary estimate of 2012-13 at Rs 37113.03 crore. The total allocation for Scheduled Tribe sub-plan has been hiked to Rs 24598.39 crore from the budgetary estimate of 2012-13 at Rs 21710.11 crore. No special scheme find place in the Budget speech for the uplift of the Scheduled Castes and Scheduled Tribes. Also the Finance Minister did not bother to question why there was a huge unspent balance left behind in the previous year.

Similarly is the case of Gender Budget with was first introduced in 2005-06.Apart from the Gender Budget, the Finance Minister set up the Nirbhaya Fund of Rs 1000 crore for safety and security of women. Is it not the duty of the State to ensure safety and security of women and the weaker sections? Will this fund alone will solve the problem?

The proposal for setting up of a Women’s Bank is fine. It will help in creating one financial institution in the country. But if the Finance Minister is so much concerned over the well being of women, he should have brought it under the scheme of priority sector lending by banks so that they can source loans from any bank without any hassle, instead of going to a particular bank which may be located far off.

The slowdown in the economy and the dismal growth rates for the year 2012-13 projected by the Central Statistical Organisation (CSO) at 5% and by the Reserve Bank of India (RBI) at 5.5% should have prompted the Finance Minister to go for a growth-oriented Budget. But this did not happen even though he realized that the Indian economy has the potential to return back to 8% growth path. He only took consolation that among major economies, only China and Indonesia were growing faster than India and if India grows at the rate projected by many forecasters, only China will grow faster than India.

The Finance Minister has totally ignored the farm sector which can push up growth prospects and generate employment. With delayed monsoon and erratic rainfall and consequent drought in certain parts of the country, the prospects of agricultural growth is slate to decelerate to 1.8% in 2012-13.

The budgetary figures indicate increase in total allocation, but the allocations are misplaced. There are no new schemes to boost the prospects of farm growth.

Irrigation facility is a necessary infrastructure in the farm sector. The Finance Minister has not suggested any new programme for augmenting irrigation facilities knowing that 60% of cultivable land lack such assured irrigation. Only allocations are made under existing programmes.

Chidambaram should have dwelt at length suggesting measures for improving soil health and boosting organic agriculture – measures necessary for boosting farm growth and improving the livelihood of farmers.

In the name of fiscal consolidation, the Finance Minister has made a deliberate cut in all subsidies, including fertilizer subsidy. In fertilizer subsidies only subsidy on indigenous production of urea has been marginally increased from Rs 20000 crore to Rs 21000 crore. Massive cut of Rs 30879.87 crore has been made in petroleum subsidy. The oil companies have begun hiking petrol prices and prices of bulk diesel supply. This will cause price inflationary trend in the economy pinching the pockets of the common man. However a mere Rs 0.95 crore has been allotted as subsidy on diesel for drought hit and rainfed areas.

With the Direct Cash Transfer on Aadhar platform in progress, the Finance Minister should have suggested direct cash transfer to farmers, relating to fertilizer subsidy, instead of routing it through fertilizer companies. Already there are reports that total benefits do not reach the farmers.

There has been a cut of Rs 5000 crore in the general food subsidy and the Government has set aside Rs 10,000 crore for the implementation of the National Food Security Act.

Small allocation of Rs 500 crore is not sufficient to start the programme of crop diversification that can promote technological innovation and encourage farmers to choose crop alternatives

The Finance Minister has earmarked Rs 250 crore subsidy on import of pulses and Rs 318.34 crore on import of edible oil, but he has not suggested new increasing the production of oilseeds and pulses. Total allocation for development of oilseeds and pulses has marked a marginal increase from Rs 405.27 crore to Rs 484.07 crore.

Government should revive the Technology Mission on Oilseeds, Pulses and Maize which had scored spectacular achievements in the initial years. The Budget has given right attention to coconut production in Kerala and Andaman and Nicobar Islands. Pulses and oilseeds need similar attention of the Government.

Chidambaran has talked about skill development and employment generation, but he should know that a great opportunity for employment generation is in rural areas. With farm holding per family shrinking in size, there is a need to attract youth in self employment and entrepreneurship in rural areas. Small and medium sized agro-based based industries need to be set up in rural areas. The rural youth should also be engaged in input supply to farms and also be encouraged in the business of sale and distribution of farm produces. If the youth find employment opportunities in rural areas, the migration to urban cities will be reduced. The Farmer-Producer Organisation is not a viable alternative.

Grain banks, owned and managed locally, should be set up in cluster of villages. These grain banks should procure farmers’ produce at prices which can enable farmers to live a decent life and encourage him to produce more. The financial support for the grain banks should come from the government. The grain banks would be the actual decentralized system of procurement at the grassroots level and would reduce transport and distribution costs of the Food Corporation of India to a large extent.

The Finance Minister has provided Rs 200 crore corpus for developing new crop varieties rich in micro-nutrients such as iron-rich bajra, protein-rich maize and zinc-rich wheat. But there are apprehensions that his fund and the funds allocated to the Department of Biotechnology may be misused for developing the controversial genetically modified (GM) crops. Micro-nutrient rich crops can be developed through conventional breeding process. GM crops have become controversial worldwide with reports of associated health and environmental hazards.
Extending loans to farmers is not the sole solution. There are continual cases of suicides by debt-trapped farmers. Solution has to be found out so that farmers lead a decent life and increase food production. The Government should know that farmers alone can give food security to the nation, not imports.