The Union Budget 2025-26, presented by the Finance Minister, has set the stage for a renewed focus on India’s agricultural sector. With an emphasis on self-reliance, productivity enhancement, and financial inclusion, the government has introduced several schemes aimed at addressing critical challenges faced by farmers. However, while some of these initiatives have been welcomed, others have sparked debate, with critics pointing out gaps in addressing long-standing farmer demands.
Assessing the Impact of Union Budget on Indian Agriculture
The Union Budget 2025-26 presents a mix of promising initiatives and concerns for India’s agricultural sector. However, whether these measures will be implemented effectively and yield tangible benefits remains a question. Financially, the agricultural budget has seen a modest 4% increase, reaching ₹1.49 trillion. However, with inflation hovering between 4-5%, the real value of this allocation could be lower. The PM-Kisan scheme remains at ₹60,000 crore, unchanged since 2019, losing value in real terms. Experts argue that the budget misses an opportunity to integrate direct income support with fertilizer subsidy reforms. The issue of stagnant rural wages, which has worsened due to the rising share of agriculture in workforce participation, remains largely unaddressed. A stronger push for labor-intensive sectors beyond agriculture is crucial for economic stability.
The emphasis on 109 high-yielding, climate-resilient crop varieties is an important step toward sustainable agriculture. However, with agricultural R&D funding still below 0.5% of agro-GDP, investment in innovation remains inadequate. Marketing remains a persistent challenge, especially for high-value crops like fruits and vegetables. The Mission for Vegetables and Fruits, with a ₹500 crore allocation, aims to improve production and market linkages but falls short of the level of investment required. Expanding e-NAM and integrating it with the ONDC platform could help farmers access better prices, though logistical and infrastructure challenges persist.
India continues to face import dependence on pulses, oilseeds, and key agro-processing raw materials, a challenge the budget does little to structurally address. Expanding pulse cultivation in rice-fallow areas and incentivizing private participation in oilseed production could be viable solutions. However, MSP-centric procurement policies still skew incentives toward rice and wheat, limiting crop diversification. Without reforms that create a crop-neutral incentive structure, India’s agricultural growth will struggle to become sustainable in the long run.
Finally, post-harvest losses remain a significant issue, with nearly ₹1.53 trillion lost annually due to inadequate cold storage and processing facilities. While the Agriculture Infrastructure Fund allocation has increased from ₹600 crore to ₹900 crore, much larger investments are required to address these inefficiencies. Overall, while the budget makes incremental progress, it lacks transformative reforms. Moving away from subsidy-heavy policies toward investment-driven, technology-backed, and market-oriented growth is essential to making Indian agriculture globally competitive.
Concerns Over Unaddressed Farmer Issues
While these initiatives have been met with optimism from some quarters, many farmer unions and agricultural experts have expressed disappointment over certain omissions in the budget. One of the most glaring issues, according to critics, is the continued absence of a legal guarantee for Minimum Support Prices (MSP). Farmer groups, including the All India Kisan Sabha (AIKS), have argued that without MSP protection, small and marginal farmers remain vulnerable to market fluctuations and exploitation by large buyers.
Several organizations have also raised concerns over the budget’s perceived pro-corporate tilt. Some farmer unions have criticized the government for favoring agrobusinesses and large-scale agrotech firms while neglecting structural issues affecting smallholder farmers. Additionally, while the budget has introduced new schemes, some experts argue that the overall allocation for agriculture remains inadequate given the scale of challenges faced by the sector.
Industry Reactions and Expert Opinions
Organizations like the Solvent Extractors’ Association of India (SEA) have welcomed the focus on self-reliance in edible oils but emphasize the need for substantial allocations to achieve these goals.
Farmer Unions Groups such as the All India Kisan Sabha (AIKS) have criticized the budget for not addressing core demands like MSP guarantees and debt relief, viewing it as an attack on the livelihoods of farmers and the poor.
Agricultural Experts – While acknowledging the positive steps towards technological integration and diversification, experts caution that effective implementation and adequate funding are crucial for these initiatives to succeed.
Simon Wiebusch, Country Divisional Head, Crop Science Division of Bayer said, “The 2025 Union Budget outlines a comprehensive strategy for enhancing agricultural productivity and sustainability, aligning with the vision of Viksit Bharat. The Finance Minister’s initiatives, such as the PM Dhan Dhanya Krishi Yojana, which aims to benefit 1.7 crore farmers across 100 districts, are particularly noteworthy.”
Mr. Sanjay Shirodkar, Co-Founder, Wavar was quoted saying, “The Union Budget 2025-26 reinforces the government’s commitment to sustainable agriculture and farmer empowerment. The introduction of the PM Dhan Dhanya Krishi Yojana and the enhanced credit support for farmers are welcome steps that will drive innovation and technology adoption in the sector. As a company dedicated to Integrated Pest Management (IPM) solutions, we see these initiatives as catalysts for a more resilient and eco-friendly agricultural ecosystem. By prioritizing sustainability, the budget lays the foundation for long-term agricultural growth, ensuring better productivity and profitability for farmers.”
Ankur Aggarwal, Chairman, CropLife India and Managing Director of Crystal Crop Protection Ltd said,“The precise focus on enhancing productivity in the Union Budget 2025-26 is expected to foster significant growth in the agricultural sector, benefiting farmers and promoting sustainable farming practices. The Government’s well-defined vision to prevent migration from rural areas, coupled with the scheme that prioritizes women and youth, is a welcome and forward-thinking step. This initiative is set to drive greater adoption of modern technologies, including drones and precision agriculture, thereby providing a much-needed boost to innovation and efficiency in the sector.”
Hemant Sikka, President of the Farm Equipment Sector at Mahindra & Mahindra Ltd. and Co-Chair of FICCI’s National Agriculture Committee said, “Budget 2025 is growth-focused, keeping in mind the country’s fiscal health while unlocking India’s real potential, with a strong emphasis on agriculture as a key engine of India’s future.”
The Need for Transformational Reforms
The Union Budget 2025-26 lays out an ambitious vision for agricultural self-reliance and modernization. It introduces several initiatives aimed at enhancing productivity, financial access, and sustainability. However, its failure to address fundamental farmer concerns, particularly regarding MSP guarantees and structural reforms, has left many stakeholders unconvinced. The success of these policies will ultimately hinge on how effectively they are implemented and whether they truly reach the farmers who need them the most.
While this budget makes some progress in addressing agricultural challenges, the overall approach remains incremental rather than transformational. A paradigm shift is needed—one that moves away from subsidy-heavy interventions toward investment-driven growth, greater private sector participation, and technology-led efficiency improvements. The path to making Indian agriculture more resilient and globally competitive requires bold reforms in subsidy rationalization, infrastructure development, and market linkages. Only then can India achieve the goal of Vikshit Bharat and position itself as an agricultural powerhouse by 2047.