India to Increase Agricultural Budget by Over 15% to $20 Billion
According to senior government sources, the additional funding will focus on the development of high-yield seed varieties, expansion of storage and supply infrastructure, and an increase in the production of pulses, oilseeds, vegetables, and dairy products.
A Strategic Push for Food Security and Inflation Control
India, the world's second-largest producer of rice, wheat, and sugar, has been grappling with persistent food inflation, which exceeded 10% year-on-year in October 2024. Although the rate has eased slightly, food prices have remained above 6% on average over the past decade.
To mitigate these pressures, the government has imposed export restrictions on key commodities such as wheat and extended duty-free imports for sel ect pulse varieties. The upcoming budget aims to further stabilize domestic supply by increasing allocations for agricultural and allied activities to approximately ₹1.75 trillion ($20.2 billion), up fr om ₹1.52 trillion in the current fiscal year.
"The objective is not just to enhance local production but also to create a surplus that enables India to expand its agricultural exports to $80 billion by 2030, fr om the current $50 billion," a senior official familiar with the budget discussions told The Times.
Increased Investment in Research and Infrastructure
A significant portion of the increased budget will be allocated to the Ministry of Agriculture, which is expected to receive more than ₹1.23 trillion. Additionally, investments in agricultural research—critical for developing new crop varieties and improving resilience against climate change—are set to increase from the current ₹99.41 billion.
The policy shift also aligns with India's broader ambitions to modernize its farm sector through advanced technology and sustainable practices. By improving seed genetics, investing in post-harvest storage, and upgrading irrigation infrastructure, policymakers hope to strengthen the country’s agricultural resilience while reducing dependence on costly imports.
Political and Economic Considerations
The move to expand agricultural funding comes ahead of India's general elections, wh ere rural voters play a decisive role. With nearly half of India's population engaged in agriculture, the government is keen to demonstrate its support for farmers while countering opposition criticism over economic hardship in rural areas.
Moreover, with global food supply chains facing disruptions due to climate change and geopolitical tensions, India's enhanced focus on self-sufficiency could provide a buffer against external shocks.
Finance Minister Nirmala Sitharaman is expected to unveil the full details of the budget on February 1, outlining how the government plans to balance increased agricultural spending with broader economic priorities.
As India accelerates its push for a stronger, more resilient agricultural sector, the upcoming budget will be closely watched for its long-term impact on food security, inflation, and the country’s position in the global agricultural trade.
