India plans to increase spending for the agriculture sector by about 15% to around $20 billion in next month's budget, two government sources said, marking the biggest increase in six years, as it tries to boost rural incomes and curb inflation.
The additional cash would be directed to developing high-yielding seed varieties, increasing storage and supply infrastructure, and boosting production of pulse crops, oilseeds, vegetables, and dairy products, the sources said.
The sources asked not to be named as they were not authorised to talk to the media.India's finance and agriculture ministries did not respond to emails seeking comments.
India, the world's second-largest producer of rice, wheat, and sugar, has grappled with high food prices, which surged past 10% year-on-year in October 2024. They have since eased slightly and have averaged over 6% in the last decade.
To try to curb price rises, New Delhi has imposed export restrictions on some farm products, including wheat, and has extended duty free import policy for some pulse varieties.
Total allocations for agriculture and allied activities in the 2025/26 fiscal year starting April are likely to increase to about 1.75 trillion rupees ($20.2 billion), up from 1.52 trillion rupees in the current fiscal year, said the sources familiar with budget discussions.
This includes a rise in the agricultural ministry's budget from 1.23 trillion rupees, and higher spending on research to develop new varieties, which currently stands at 99.41 billion rupees, one of the sources said.
The second source said agriculture was one of the priorities of the budget that Finance minister Nirmala Sitharaman will present on Feb. 1.
The same source said the government was seeking not just to increase domestic supplies but to generate a surplus sufficient to increase farm exports to $80 billion by 2030, up from the current $50 billion.
Agriculture employs nearly 45% of India's workforce and contributes nearly 15% to the $3.5 trillion economy.
