Punjab finance minister Harpal Singh Cheema on Sunday allocated ₹15,377 crore for agriculture and allied sectors in the state budget for 2026-27, with a focus on crop diversification, market reforms and farmer welfare.
Presenting the budget, Cheema said 50% of the allocation will be spent on providing free power to around 14.5 lakh agricultural tubewells, which irrigate 32-35 lakh hectares of farmland during the rabi and kharif seasons.
“Punjab accounts for nearly 3% of the country’s total cultivated area, yet contributes about 40% of wheat and 31% of rice to the central grain pool,” Cheema said, adding that the state continues to play a critical role in ensuring national food security.
During the 2025-26 fiscal, the state extended a 33% subsidy on Bt cotton hybrid seeds recommended by the Punjab Agricultural University. The scheme benefited over 52,000 farmers, with ₹11 crore transferred directly to cultivators, leading to a 19% increase in cotton acreage this season.
Push for water-efficient farming
{{/usCountry}}Push for water-efficient farming
{{/usCountry}}To promote water conservation, farmers adopting Direct Seeded Rice (DSR) receive ₹1,500 per acre as financial assistance.
The government distributed ₹35 crore under the scheme in 2025–26, and has proposed ₹40 crore for 2026–27 to further encourage the technique, which reduces labour demand and conserves groundwater, said Cheema.
Crop diversification initiative
To encourage water-efficient cultivation practices, financial assistance of ₹1,500 per acre is being provided to farmers adopting direct seeded rice (DSR) technique. During the 2025-26 fiscal, assistance amounting to ₹35 crore was given to farmers and for the upcoming year, realizing the benefits in addressing labour shortages and conserving groundwater, a provision of ₹40 crore is proposed for year 2026-27 to further promote paddy transplantation that conserves subsoil water.
To promote sustainable cropping pattern, a pilot project encouraging a shift from paddy to kharif maize has been implemented in six districts — Pathankot, Gurdaspur, Bathinda, Sangrur, Jalandhar and Kapurthala with an incentive of ₹17,500 per hectare, an allocation of ₹15 crore has been made during the financial year 2026-27.
₹600 cr to tackle stubble burning
To curb crop residue burning during the paddy harvest season, the government continues to subsidise stubble management machinery, providing 80% subsidy to panchayats and 50% subsidy to individual farmers.
While ₹402 crore was allocated in 2025-26, the provision has been increased to ₹600 crore for 2026-27.
Horticulture expansion
To promote high-value crops, the state will implement a ₹1,300 crore horticulture programme over the next 10 years with assistance from the Japan International Cooperation Agency (JICA).
Support for dairy farmers
Cheema also announced ₹100 crore to stabilise milk procurement prices, aimed at ensuring better returns for dairy farmers and protecting them from market fluctuations.