The commodities and agri-business sectors have welcomed the Union Budget proposals tabled by Finance Minister Nirmala Sitharaman on Wednesday, saying they are positive.
Budget 2023-24: Big Digital Push for Agriculture
But some have voiced concerns over the Centre either raising the import duty or not considering the demand for lowering it. However, various players in the sectors see room for the economy to progress with the Finance Minister providing scope for increasing the purchasing power of the common man. “Under the new tax regime, the budget has made room for more disposable income and purchasing power of consumers will increase. For natural diamonds, we’ve seen an encouraging trend over the past few months where consumers are purchasing items which hold meaning and value. As customers continue to value what is natural and genuine, diamonds will always be in demand,” said Amit Pratihari, Vice President, De Beers Forevermark.
Bullion sector’s disappointment
Budget 2023-24: Big digital push for Agriculture
“The gold import duty has remained the same; we expected it to go down by 2.5 per cent. On the other hand, the import duty on silver has increased by 2.5 per cent, affecting the fashion jewellery market due to the price hike of sterling silver,” said Aditya Modak, Co-founder, Gargi by P N Gadgil & Sons.
On the other hand, he said the increase in the Income Tax limit will increase the disposable surplus income of the middle class, which will be good for tourism, discretionary spending and luxury FMCGs.
According to Ravindra V Rao, CMT, EPAT, VP-Head Commodity Research, Kotak Securities Ltd, the Budget held “very few surprises” for the commodity industry. Precious metals witnessed some structural duty changes as the import duty on silver dore, bars and articles were increased to align them with that on gold and platinum. Markets were expecting a cut in gold import duty in order to support the domestic gems and jewellery industry but fears of a wider current account deficit as indicated in the economic survey likely prompted the authorities to stay put.
Green initiatives lauded
Anjali Bansal, Founder, Avaana Capital, said the Budget rightly builds incentives to support low-carbon development pathways with a focus on Green Growth among the Saptarishi priorities. “We welcome the increased outlay towards energy transition, particularly for Green Hydrogen and waste-to-energy, which will boost energy independence,” she said.
Sanjiv Lal, MD & CEO, Rallis India, said announcements made for the agriculture sector will augment production, promote science and tech-led agriculture, encourage cooperative societies for farmers and provide better-decentralised storage facilities. “What makes this budget promising for farmers is the thrust of the government to incorporate technology in agriculture at various levels. The announcement of creating digital public infrastructure for agriculture will be a strong enabler of inclusive farmer-centric solutions and help improve access to farm inputs, market intel and support for the agriculture industry and start-ups,” he said.
Tarun Sawhney, Vice-Chairman and Managing Director, Triveni Engineering & Industries Limited, said steps like the Agri Accelerator Fund and the setting up of 10,000 bio-input resource centres will create meaningful opportunities for natural farming, strengthening the entire agri value chain, especially with greater credit access to the agri sector.
“We are also enthused by the government’s push on waste to wealth under GOBARdhan (Galvanizing Organic Bio-Agro Resources Dhan) scheme, which envisages 200 compressed biogas (CBG) plants, and in due course a CBG mandate of 5 per cent for all organizations marketing natural and biogas,” he said.
‘Step in the right direction’
Narinder Wadhwa, President-CPAI, said the hike in the agricultural credit target is a big boost for the agri sector. Many announcements on IFSCA gift city will boost activities in the Gift city.
Arun Singh, Global Chief Economist, Dun & Bradstreet, said the budget has a digitalised approach to modernisation and the proposal to build a digital public infrastructure for agriculture is a positive step towards providing farmers with relevant information services and access to farm inputs, credit and insurance.
Harsha Razdan, Partner and Head, Consumer Markets and Internet Business, KPMG in India, said proposals in the Budget providing digital public infrastructure for agriculture, financial support and cooperation to farmers, besides setting up the Agri Accelerator Fund are a step forward to uplift the farmer community and promote entrepreneurship.
Prabhat Chaturvedi, CEO, Netafim Agricultural Financing Agency Pvt. Ltd, said agriculture remains the core of the budget with the agriculture accelerator programme facilitating easy navigation of regulations and connecting all stakeholders in the farm supply chain network.
Hoping for innovations
“The advancement in digital payments, development of agri infrastructure and intel; as an open-source platform with public-private collaboration will ensure a progressive graph for the sector in India,” said Rituraj Sharma, spokesperson and founder of Growpital.
Abhishek Jain, Fellow & Director, Powering Livelihoods, CEEW, hoped the newly-announced Agriculture Accelerator Fund brings an explicit focus on hardware technological innovations to address challenges like pest and weed management, affordable storage and post-harvest solutions, as well as innovations for livestock and allied sectors.
Akash Agarwal, CEO, New Leaf Dynamic Technologies, said implementing decentralised storage facilities is a firm step to doubling farmers’ income. This will reduce post-harvest losses to less than 5 per cent at the farm gate — a figure comparable to developed countries.
Vasanth Madhav Kamath, Founder & CEO of Hydrogreens Agri Solutions, said green energy, green farming, distributed bio-fertile production centres, and a further push for agri accelerators are great actions to catalyse productivity while also nudging environmentally sustainable practices.
Fisheries to gain
Ankit Alok Bagaria, Co-Founder, Loopworm, said the ₹6,000 crore infusion to promote fisheries will help shrimp farming the most. Decreasing import duties on feed ingredients will help the feed manufacturers and help formalise animal agriculture but would lead to reduced margins for domestic feed ingredient manufacturers. Anand Srinivasan, Managing Director, Covestro, said the Budget has taken a significant step towards green growth with its focus on green hydrogen, clean energy storage and transmission that will help in the transition to a low-carbon economy and reduce its carbon footprint.
SK Chaudhary, Founder Director, Safex Chemicals India Ltd, said the Budget has many positive features for agriculture and agri industries. “The decision to build digital public infrastructure for agriculture will facilitate multiple inclusive, farmer-centric solutions with relevant information services spanning crop planning, farm inputs, insurance, credit and market intelligence as well as support for the growth of the agritech segment and start-ups,” he said.
Boost to modern farming tech
Tarun Arora, Director of Single Family Office at IG International, said the budget will help in adopting modern farming techniques and increase agricultural demand.
Abhijeet Mittal, CGO, Mooofarm, said the Agriculture Accelerator fund is the next big push for the sector, making quality deliverables to farmers uniformly more accessible. The government’s support in computerising 63,000 primary agricultural credit societies with an investment of ₹2,516 crore is just the start of the bigger picture to unfold for the sector, he said.
Varun Khurana, Founder & CEO, Otipy, said the government’s focus on agriculture, specifically setting up an Agri Accelerator Fund for agri start-ups, will accelerate the pace of innovation in the context of the employment it generates. “The government’s commitment to set up digital public infrastructure for agriculture will help the agritech start-ups to connect with more farmers and in turn enable them to realise better value for their produce, he said.
Biofuels’ importance
Kishan Karunakaran, Founder and CEO, Buyofuel, said the Budget has recognised the importance of renewable energy and biofuels, specifically for biofuels.
Tharakeswar Ganta, Co-founder and Interim CEO, Dvara E-Registry, said the digital public infrastructure for agriculture will revolutionise the farm sector by giving access to agriculture information and removing the information asymmetries between credit providers and borrowers (farmers), buyers and sellers.
Ruchit Garg, Founder & CEO, Harvesting India Pvt Ltd, welcomed the announcement on investing in the agri-tech space, especially focused on rural India. “It is also encouraging to see the focus on millets crops, agri-credit and small farmers and envisaging India to become a global hub for Sri Anna or millets,” he said.
Aman Mittal, Vice-President, LPU, said the new start-up fund will bring in investors as well as innovators to work together to solve the problems at the grassroots level faced by the farmers.
Global hub for millets
Meghana Narayan and Shauravi Malik, Co-founders, Wholsum Foods Pvt Ltd which makes millet-based children’s food brand Slurrp Farm, said the Budget envisions on India becoming the global hub for millets and applauded the move.
Sanjay Viswanathan, Chairman, AdiGroup, said infusion of new skills and technology (drones), and start-up capital in the sector will drive innovation and farmer’s productivity and income significantly.
Neeraj Choudhary, Group Head Finance, Absolute, said the government’s commitment to ‘green growth’ approach is a step towards building a cleaner India. The government has clearly sent across a strong message that sustainability has to be central to economic and social growth.
Kaushik Kappgantulu, Co-Founder, Kheyti, said the main challenge of the Budget proposals will be in implementation and integration — to ensure all these efforts actually work together to deliver seamless benefits to farmers rather than becoming siloed interventions.
Focus on supply chain
Naresh Kumar, Chief Business Officer, Kissandhan Agri Financial Services Pvt Ltd (Kissandhan), said the budget focuses a lot on the supply and input side of the agricultural value chain. “The shift towards decentralised storage is also an important step in reducing wastage and helping increase the shelf-life of agricultural produce,” he said.
Saurabh Agarwal, Director and CEO, GROWiT India Pvt Ltd, said it is necessary to leverage the start-up energy into the agricultural landscape to make it competitive in the foreign markets. Steps announced in the Finance Bill contribute to increasing the efficiency of rural India and markets.
Deepak Pareek, Chief Growth Officer, Suumaya Agro Limited, saidthe Budget is progressive and the government has followed through on its promises. “The budget clearly demonstrates a focus on technology, innovation, and start-ups. This will unlock the sector’s potential and remove obstacles,” he said.