Nirmala Sitharaman announces measures as part of a mega stimulus amid coronavirus pandemic.
The government will provide Rs 1 lakh crore to fund agriculture infrastructure projects, Finance Minister Nirmala Sitharaman said today in her third set of announcements on the mega economic stimulus to help various sectors battered by the coronavirus crisis and the prolonged lockdown to slow its spread.
Ms Sitharaman also said the Essential Commodities Act would be amended and pulses, cereals, edible oil, oil seeds, onions and potatoes would be taken out of it to help farmers get better prices.
Stock limits will be imposed only under exceptional circumstances, which means those in the chain like processors, millers, importers, exporters and traders can hold as much stock of these commodities as they want to.
The government will also bring in a law to give farmers the choice to sell their produce anywhere and get the price they want. The law will allow farmers to conduct "barrier-free interstate trade" and also use e-trading of farm produce, the minister said.
In what the government has earlier dubbed the "one nation, one market" policy, farmers can sell their produce anywhere in India to get the best price. This also does away with middlemen.
Farmers are currently bound to sell their produce only to licensees in the Agricultural Produce Market Committee (APMC), a restriction that does not exist for any other industrial produce.
The minister said this results in stalling the free flow of agricultural produce and fragmentation of markets and the supply chain.
A legal framework will enable farmers to engage with processors, aggregators, large retailers and exporters in a fair and transparent manner, Ms Sitharaman said.
Prime Minister Narendra Modi said the measures announced today will help the rural economy, farmers, fishermen, animal husbandry and dairy sectors.
Earlier this week, PM Modi had announced a cumulative package of Rs 20 lakh crore, nearly 10 per cent of India's GDP, to help various sections of the economy battered by coronavirus lockdown.
This included a Rs 1.7 lakh crore package for free food grain and cash to the poor for three months announced in March, after the coronavirus lockdown was announced, and a Rs 5.6 lakh crore stimulus through various monetary policy measures by the Reserve Bank of India (RBI).
On Wednesday and Thursday, the government had made two tranches of announcements worth Rs 9.1 lakh crore, which included credit lines to smaller firms, concessional credit to farmers and support to shadow banking and electricity distributors.
The measures are meant to shore up an economy that has taken a severe hit after the country went into complete lockdown on March 24.