The Finance Minister Nirmala Sitharaman has attempted to dispel the fears that the minimum support price (MSP) regime would be discontinued, said Sanjay Kaul, Chairman, National Collateral Management Services Limited (NCML) referring to the Budget announcement that the Agriculture Infrastructure Fund would be made available to APMCs for augmenting their infrastructure facilities.
The steps taken by the government to enhance procurement of paddy, wheat, pulses and cotton should provide assurance to the protesting farmers, said Kaul adding that the Budget is positive on two counts.
"Agri infrastructure such as warehousing, silos and cold chains have long gestation periods and the establishment of a professionally managed Development Financial Institution with an outlay of ₹20,000 crore to capitalise this institution could become a catalyst for agriculture infrastructure financing. Second, rural infrastructure would also get a boost by the enhanced allocation to the Rural Infrastructure Development Fund from ₹ 30,000 crore to ₹ 40,000 crore," he added.
Kaul stated that the two other steps in the food and commodity space are worthy of note. The decision to discontinue the NSSF Loan to FCI for Food Subsidy and correct the Budget Provisions for food subsidy in RE 2020-21 and BE 2021-22 are steps towards greater realism and transparency.