Developing agriculture sector with a reduced budget

As the Hon’ble Finance Minister introduced the 2012-2013 Budget in the National Council today, one of the very first things he highlighted was how the rupee problem has ‘offered us opportunities to develop our domestic industries especially the agriculture sector.’ He stated, “In that sector, in spite of heavy investments in the past, we could never really encourage our farmers to increase their output as products could be simply imported. Today with the difficulty in imports, our farmers are encouraged to produce more, and that has many benefits. For one, rural livelihood is set to become more attractive and the rural-urban migration trend is now seeing the possibility of slowing down. Rural incomes are set to rise, and thus there are bright prospects of the rural poverty levels being reduced. It is appropriate too that now that our rural areas have almost been provided with the basic infrastructure of roads, electricity and communication.”
How do we seize this opportunity to encourage our farmers to produce more, generate more income and address issue of rural poverty? It is not enough to say to our farmers, ‘The rupee problem has created an excellent opportunity. Seize it!’ I expected the Royal Government to allocate more resources to agriculture sector, on which 69% of our people depend for livelihood so that they are able to seize the opportunity.’ For the next one year, the outlay for agriculture sector is 12% of the total Budget amounting to Nu.4,551.294 millions. How does this compare with Budget allocation in the previous years? Look at the following table.
Between the previous (2011) and present fiscal year (2012), the total Budget allocated for agriculture sector declines by 1% amounting to Nu.810.836 million. The outlay for capital expenditure, which is an important investment, gets reduced by Nu.844.728 million. How can farmers seize the present opportunity when the Budget allocation to agriculture sector is slashed down instead of increasing it? How can the Budget ‘promote agriculture production, distribution and marketing’ in order to promote sustainable socio-economic development?
Although 69% of our people depend on subsistence agriculture, that sector has not received priority as other sectors. Therefore, owing to minimal growth, the contribution of agriculture to our GDP has been declining from 55.7% in 1980 to 44.1% in 1990, 32.9% in 2001 and 16.2 in 2010. That is expected when the society urbanizes and other sectors of the economy grow. The fact however, remains that there is minimal growth in agriculture sector. Given the reduced Budget allocation even in this fiscal year, agriculture’s contribution to GDP would decline further both in actual and relative terms. That has direct implication on the subsistence livelihood of our farmers. The question we must ask ourselves is this: Can we develop agriculture sector with a reduced Budget?

                              Budget Allocated to Agriculture

Fiscal Year                     Current                Capital              Amount (in millions)          Percentage

2009-2010            Nu.1445.722       Nu.1946.521            Nu.3392.243                    11.2

2010-2011            Nu.1559.567       Nu.1988.032            Nu.3547.599                    10

2011-2012            Nu.1813.824       Nu.3548.306           Nu.5362.130                      13

2012-2013            Nu.1847.716       Nu.2703.578           Nu.4551.294                     12


Sonam Kinga is the Deputy-Chairman of the National Council

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  1. Do this guy have any idea about what he is talking coz he never ran a government office? Even if we increase the budgetary allocation for Agirculture, that money is never going to reach the farmers. The additional money will go to repair an office, buy the latest laptop and camera for officers, replace a furniture or a useless scheme of farmers training where they will pocket the money for their own gain.

  2. Has the Hon Sonam Kinga looked at where the cuts in agriculture are? Maybe that will shed light on whether the reduced allocation is an issue or not.

  3. Why people are familiar with budget only ? There is no other means of doing other than money for any development? 

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