Presented by Finance Minister Nirmala Sitharaman, the first budget of the new government reflects a clear vision for transforming India into a Viksit Bharat by 2047 by focusing on stupendous growth and financial commitment. The fiscal deficit target of 4.9 percent of GDP for 2024–25 is a key milestone. It offers flexibility to handle possible global issues and uncertainties. This target is set to inspire confidence for domestic and international investors, laying a robust foundation for agri-product growth.
The budget highlights next-generation reforms and showcases the fiscal sector’s readiness to support the agri-logistics approach that is crucial to boosting India’s economic growth. This approach not only streamlines the government's agenda but also paves the way for exporters to focus on promoting their agricultural logistics.
The Union Budget 2024 lays emphasis on enhancing agricultural productivity, promoting eco-friendly farming practices, and allocating ₹1.5 lakh crore to ensure inclusive development, which is declared the third-largest sectoral investment. In the recent budget session, the finance minister announced that 18% of agri-products have contributed to India's GDP.
Finance Minister Nirmala Sitharaman also announced that the government will conduct an extensive review of research into growing resilient seeds to withstand climate change conditions. The finance minister mentioned in the budget session that the government will implement digital public infrastructure for agriculture by collaborating with states. The minister further added that one crore farmers will be introduced to natural farming practices in the coming two years. In addition, the government will allocate Rs 2.66 lakh crore for rural development, the minister said.
The finance minister stated that to achieve self-sufficiency in pulses and oilseeds, the government will enhance production, storage, and marketing. As announced in the budget session, a strategy is being implemented to achieve self-reliance and develop oilseeds like mustard, groundnut, sesame, soybean, and sunflower, the minister said.
In the current budget session of 2024, Nirmala Seetharm said that the government will implement measures for exporters to promote their agri-export businesses globally. The government will allocate funds to develop infrastructure like cold chain facilities and efficient transportation networks to mitigate the challenges faced by exporters involved in the perishable business . Furthermore, the budget is also planning to offer incentives such as tax breaks or subsidies for exporters, which can lessen operational costs and facilitate export activity.
To add more delight, Sitharaman emphasized motivating new exporters entering the agri-export industry. The honorable minister announced that financial support will be provided to support these newcomers in gaining profitable exposure in international markets. Overall, the decisive budget allocations and policy changes aim to create a more favorable environment for fresh agricultural exporters, enhancing their ability to display their agricultural products on the global stage.
In this scenario, Citrus Freight offers a plethora of services designed to guide agricultural exporters to cope with the complexities of international trade. The experienced team at Citrus assists exporters in understanding the importance of export documents and compliance with international regulatory requirements, which paves a path to ship the agricultural products without any hindrance.
In her Budget 2024 speech, Sitharaman also brought forward plans to develop large-scale clusters for vegetable production near major consumption centers. The finance minister said the government will promote farmer-producer organizations, cooperatives, and start-ups to facilitate vegetable supply chains, including collection, storage, and marketing.
The Agricultural and Processed Food Products Export Development Authority ( APEDA ) recently reported a three percent decline in agricultural exports for Q2 2024, primarily due to the Red Sea crisis .
Though maize exports dropped 76 percent to USD 60 million from USD 517.8 million in Q2 2023, On the bright side, APEDA witnessed a 6.47 percent increase in fruit and vegetable exports. The APEDA chairman also unveiled plans to expand the agri-exports network by registering 2,500 Farmer Producer Organizations (FPOs) as exporters this financial year.
These are the key factors that were highlighted in the current budget session for the agriculture sector.
Promote agricultural research
- Productivity and climate resilience: A comprehensive review will be conducted with the aim of enhancing productivity and developing climate-resilient crop varieties.
- National Cooperation Policy: This policy will extend and support systematic growth in the cooperative sector.
- Crop Varieties Introduction: Releasing 109 new high-yielding, climate-resilient varieties of 32 field and horticulture crops.
Natural farming practices
- Farmer involvement: One crore farmers will be introduced to natural farming practices in the coming two years.
- Bio-input resource centers: 10,000 natural farming centers will be established to ease the farming process.
Public digital infrastructure (DPI)
- Farmer Coverage: DPI will be conducted to cover farmers and their lands within three years.
- Digital crop surveys: crop surveys will be conducted across 400 districts.
- Kisan Credit Cards: The Jan Samarth platform will issue Kisan Credit Cards.
- Registries of the Farmers: There will be data integration for six crore farmers and their lands into one registry.
Strengthening the Agri-Product Sector
Agricultural Supply Chain: Promotion of farmer-producer organizations, cooperatives, and start-ups to improve the agri-product sector.
Water Infrastructure Projects for Agriculture-Products: Introduction of water and sanitation projects to use treated wastewater for agricultural irrigation.
Constructing Infrastructure for Sustainable Agriculture: Financial support for both new and continuing initiatives, such as barrages, flood mitigation, and river pollution abatement, as well as irrigation projects.
Agriculture Innovation and Research:
National Research Fund: releasing funds for basic research and prototype development in agriculture.
Private Sector Research: A step in promoting agricultural innovation is the creation of a method for private sector-driven research and innovation that has a sizable funding pool of Rs 1 lakh crore.
Land Reforms
Concentrating on rural land-related actions such as assigning Unique Land Parcel Identification Numbers (Bhu-Aadhaar), establishing land registries, and linking these to farmers' registries aims to create a more organized land management system.
Apart from this, the Finance Minister also laid emphasis on investing in shrimp production, processing, and exporting through NABARD. The minister also stated that the government is planning to set up a network of nucleus breeding centers for shrimp broodstocks.
Value-Added Farm Products Promotion
Food Irradiation Units : Providing financial assistance for the establishment of fifty food irradiation units in the MSME sector.
MSME credit scheme : the implementation of a credit guarantee program to purchase equipment and machinery.
MSME credit model : Public sector banks are creating a new approach to evaluating loans.
Credit support : provision of credit support during tough times.
Food quality labs : 100 NABL-accredited food quality and safety testing labs will be built.
C-PACE Services: Services will be extended for the LLP’s voluntary closure.
The Interim Union Budget 2024 for Cold Chain Logistics
In the budget speech, the finance minister, Nirmala Seetharam, states that the government is also advancing to modify the infrastructural development in the logistics sector. At the heart of the budget, the government is planning to introduce multimodal transport, cargo terminals, and parks to increase the growth of the supply chain network and shift modal freight to an era of green logistics. The recent budget committed to facilitate rural infrastructure development for the various logistics companies to expand the cold chain management in the perishable foods sector and increase the warehouse and storage facilities in the vicinity of the food industries. Increasing rural connections will enable new markets to reach a larger consumer base through their supply chain networks.
Another strong move of the Union Budget is Ease of Doing Business (EODB) for Micro, Small, and Medium Enterprises (MSME). MSME is the pillar of the Indian economy, which automatically increases the demand for logistics services.This industry has improved the movement of commodities both domestically and internationally, enabling smaller enterprises to become more efficient and competitive. Indeed, as manufacturing and exports rise, the logistics sector will need a more skilled workforce to handle the intricacies of modern supply chains. Areas like inventory management, transportation planning, and supply chain technology need expertise.
As India moves towards becoming a $5 trillion economy, the logistics industry will play a significant role in linking producers with consumers both domestically and internationally. The Union Budget 2024 outlines a clear plan for the growth of logistics, keeping in mind the objective aligned with the National Logistics Policy.
Conclusion
In a nutshell, the Union Budget session represents that export logistics, agri-logistics, and cold chain management are vital components of a robust supply chain that supports India’s economic growth and global trade ambitions. Organized export logistics ensure seamless international transactions, while agri-logistics enhance the movement and storage of agricultural products. Cold chain management retains the quality of perishable goods, reduces waste and food shrinkage, and ensures market credibility.