Union Budget 2025: Modi govt may raise agriculture spending by over 15%, largest increase in six years, says report

This increase in agricultural spending, the biggest in six years, is planned as a bid to boost rural incomes and curb inflation

The Union Budget 2025 may prioritise agriculture, with the government increasing its spending on the sector by 15% to about $20.2 billion ( ₹1.75 lakh crore), news agency Reuters reported, citing two unnamed government sources.

Union Budget 2025: Workers plant paddy in the fields in Wayanad district of Kerala (Courtesy Rajesh Krishnan)

HT couldn't independently verify the information.

This increase in agricultural spending, the biggest in six years, is planned as a bid to boost rural incomes and curb inflation.

According to the report, the extra funding, compared to the ₹1.52 lakh crore this year, would be used to develop high-yielding variety (HYV) seeds and increase storage and supply infrastructure, as well as boost the production of pulse crops, oilseeds, vegetables, and dairy products.

The agricultural ministry and research budget both may get raised from the current ₹1.23 lakh crore and ₹99,410 crore, respectively, Reuters reported.

All of this comes at a time when India, the world’s second-largest producer of rice, wheat, and sugar, is grappling with high food prices, which surged past 10% year-on-year in October 2024.

However, they did ease slightly, averaging over 6% in the last decade.

The government had also imposed export restrictions on some agricultural products including wheat, along with extending the duty free import policy for some pulse varieties to try curbing the rising prices.

Agriculture also employs nearly 45% of India's workforce and contributes nearly 15% to its $3.5 trillion economy.

The government also seeks to generate a surplus to increase agricultural exports to $80 billion by 2030, up from the current $50 billion.

Subsidised farm loans may also increase from the current ₹3 lakh to ₹5 lakh, and crop insurance may also be expanded.

Meanwhile, the government also plans to boost pulse production to 30 million metric tons by 2030, and also invest $9 billion in the fisheries sector over the next five years, according to the report, which added that the plans also include incentives of about ₹10,900 crore for food processing firms through 2027.