New Delhi, Jan 29 (GCCurrentAffairs) Prime Minister Narendra Modi has said his government is taking rapid steps towards doubling the income of farmers by 2022.
He said emphasis is also on promoting agricultural technology-based startups so that farmers’ databases and agri stacks needed for smart and precision agriculture can be used.
The Prime Minister’s statement on Tuesday is indication enough that Finance Minister Nirmala Sitharaman would make some announcements to revive the rural economy which has been facing signs of distress, resulting in the slowdown in growth.
Most farmers in the country are currently reeling under the effects of two years of drought, unseasonal rains, floods and stagnant wages, which have reduced the propensity of rural households to spend freely.
Rural India is said to be a “spender’s market” and not a saver’s one, and more money at the hands of farmers helps drive consumption and give a fillip to the rural economy and GDP growth.
IMF chief economist Gita Gopinath has cited poor rural consumption as one of the key reasons behind lowering India’s GDP growth rate to 4.8 per cent in FY20 from 6.1 per cent estimated in October 2019. The Finance Minister, she says, should focus on reviving credit growth and consumer spending in the rural areas in the upcoming Union Budget to boost the struggling economy.
Ms Gopinath says that policies related to rural income transfers would help much more in reviving consumer demand than income tax relief.
The ruling Bharatiya Janata Party is said to have impressed upon the finance minister to focus on enhancing rural income.