01 Read
What happened
India's Department of Agriculture and Farmers Welfare budget rose from ₹27,663 crore in 2013-14 to ₹1,40,528.78 crore in 2026-27, a five-fold increase over thirteen years. This growth reflects sustained policy emphasis on MSP revision, digital agriculture, crop insurance, and allied sectors including fisheries and animal husbandry. The expansion spans flagship schemes such as PM-KISAN, PM Fasal Bima Yojana, and the Pradhan Mantri Matsya Sampada Yojana, all aimed at doubling farmer income and improving food security.
02 Understand
Why it matters
The five-fold rise in agricultural budget allocation signals a structural shift in how India prioritises agrarian policy. Three interconnected pillars explain this expansion.
First, income support: PM-KISAN alone transfers ₹6,000 per year directly to over 11 crore farmer families, making it one of the world's largest direct benefit transfer programmes. This bypasses intermediaries and links Aadhaar-verified beneficiaries directly to public funds.
Second, risk management: PM Fasal Bima Yojana (PMFBY) and the Restructured Weather-Based Crop Insurance Scheme provide actuarial-backed insurance at heavily subsidised premiums — farmers pay 2% for kharif, 1.5% for rabi, and 5% for horticulture, with the Centre and states sharing the remaining premium burden.
Third, allied-sector investment: Pradhan Mantri Matsya Sampada Yojana (PMMSY), with an outlay of ₹20,050 crore, is the largest-ever investment in India's fisheries sector, targeting 70 lakh additional employment and 9% growth in fisheries GVA. Similarly, the Animal Husbandry Infrastructure Development Fund (AHIDF) supports private investment in dairy and meat processing.
For exam purposes, the key analytical point is that Indian agricultural policy has moved from subsidy-led input support (fertiliser, power) toward output-price assurance (MSP), income transfers (PM-KISAN), and value-chain investment (PMMSY, AHIDF). NABARD's role as the apex development finance institution sits at the centre of rural credit delivery, refinance, and supervision of cooperative banks — all amplified by this budget expansion.
First, income support: PM-KISAN alone transfers ₹6,000 per year directly to over 11 crore farmer families, making it one of the world's largest direct benefit transfer programmes. This bypasses intermediaries and links Aadhaar-verified beneficiaries directly to public funds.
Second, risk management: PM Fasal Bima Yojana (PMFBY) and the Restructured Weather-Based Crop Insurance Scheme provide actuarial-backed insurance at heavily subsidised premiums — farmers pay 2% for kharif, 1.5% for rabi, and 5% for horticulture, with the Centre and states sharing the remaining premium burden.
Third, allied-sector investment: Pradhan Mantri Matsya Sampada Yojana (PMMSY), with an outlay of ₹20,050 crore, is the largest-ever investment in India's fisheries sector, targeting 70 lakh additional employment and 9% growth in fisheries GVA. Similarly, the Animal Husbandry Infrastructure Development Fund (AHIDF) supports private investment in dairy and meat processing.
For exam purposes, the key analytical point is that Indian agricultural policy has moved from subsidy-led input support (fertiliser, power) toward output-price assurance (MSP), income transfers (PM-KISAN), and value-chain investment (PMMSY, AHIDF). NABARD's role as the apex development finance institution sits at the centre of rural credit delivery, refinance, and supervision of cooperative banks — all amplified by this budget expansion.
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