India Plans 15 Mega Food Parks And $105 Billion In New Farmer Lending
The Indian government announced its Union budget for 2011- 2012 on Monday with a heavy focus on food security.
Food spending include:
- Increased lending to farmers with a total allocation of $104.9 billion. The effective interest rates for farmers will be 4% annually.
- 15 mega food parks to better store stockpiles. About 40% of India's produce goes to waste because of an absence of adequate storage facilities.
- $88 million for the green revolution in Eastern India which would target the development of the rice-based cropping system in the region.
- $66 million each for National Mission for Protein Supplements and the Accelerated Fodder Development Programme, two new initiatives for farmers.
- $66 million for a new initiative that aims to improve productivity and income of farmers.
- $66 million each to promote production of multi-cereals, palm oil and promote 60,000 villages that grow pulses.
Farmers need loans because many are buried in debt, and little of the increase in crop prices trickles down to them. Without money they won't be able to increase production.
But opposition parties say the budget doesn't do nearly enough to help the common man, who is suffering under 11.5% y-o-y food inflation. Communist leader Gurudas Dasgupta said the Budget was "directionless" and did not reflect any seriousness by the Government to address the issue of unemployment or keenness to mop up additional resources and taxing rich people, according to The Economic Times.
Other budget highlights include:
- Social sector will receive $35.5 billion, 36.4% of the total plan.
- Limit for Foreign Institutional Investors in corporate bonds raised to $40 Billion. Foreign investment policy to be further liberalized this year.
- $47 billion for infrastructure sector a 23% increase over the previous year and $6.6 billion in tax-free bonds by various government undertakings.
- $11.5 billion for education a 24% increase over the previous year.
- $5.9 billion for the health sector up 20% from last year.