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What does the Union Budget have for agriculture?

February 14, 2026 4 min read Economics Polity & Governance GS3 (Agriculture Indian Economy Budget) GS2 (Government Schemes)
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What Happened

  • Budget 2026-27 allocated Rs 1.62 lakh crore for agriculture and allied activities, an increase of approximately 7% over the Revised Estimates of Rs 1.51 lakh crore for 2025-26.
  • PM-KISAN (Pradhan Mantri Kisan Samman Nidhi) received Rs 63,500 crore — about 45% of the Ministry of Agriculture's total budget — maintaining the same amount as the 2025-26 Revised Estimates, with no enhancement in the per-farmer transfer of Rs 6,000 per year since the scheme's inception in 2019.
  • PMFBY (Pradhan Mantri Fasal Bima Yojana) allocation was cut by 15.7% to Rs 12,200 crore — the lowest since 2019-20 — despite crop insurance enrollment and coverage gaps remaining a persistent concern.
  • Analysts and agriculture policy researchers argue the budget follows an imbalanced pattern: income support dominates (PM-KISAN), while investment in crop insurance, irrigation, agricultural research (ICAR), and extension services remains under-resourced.
  • A more balanced approach toward agricultural funding — directing a larger share toward productivity enhancement, post-harvest infrastructure, and risk management tools — is seen as essential for structural transformation of the sector.

Static Topic Bridges

PM-KISAN (Pradhan Mantri Kisan Samman Nidhi) — Design, Coverage, and Critiques

Launched in February 2019, PM-KISAN provides direct income support of Rs 6,000 per year (in three equal instalments of Rs 2,000) to all landholding farmer families, subject to exclusion criteria. The scheme is implemented through Direct Benefit Transfer (DBT), credited directly to Aadhaar-linked bank accounts.

  • Coverage target: approximately 9.5 crore eligible farmer families in 2026-27.
  • Exclusion criteria: institutional landholders; families with members who are/were Constitutional post holders, serving/retired government officials, professionals (doctors, engineers, lawyers, chartered accountants), or income taxpayers (with exceptions).
  • Budget allocation: Rs 63,500 crore in 2026-27 (same as 2025-26 RE); Rs 20,000 per farmer family over three years from Rs 6,000/year implies marginal income support.
  • Criticism: the per-farmer amount (Rs 6,000/year = Rs 500/month) is considered grossly inadequate relative to actual input costs; no revision since inception; tenant farmers and sharecroppers are excluded as they are not landholders.
  • The scheme is the world's largest DBT programme by beneficiary count in the agricultural sector.

Connection to this news: PM-KISAN consuming ~45% of the agricultural ministry's budget without a per-farmer enhancement crowds out allocation for productivity-enhancing investments. The article's call for balance refers partly to rebalancing this PM-KISAN dominance with investments in infrastructure and technology.

Pradhan Mantri Fasal Bima Yojana (PMFBY) — Budget Trend and Coverage Issues

PMFBY, launched in 2016, is the central crop insurance scheme replacing NAIS (1999) and MNAIS (2010). Premium rates are capped at 2% (Kharif), 1.5% (Rabi), and 5% (commercial/horticulture), with the actuarial premium balance shared between central and state governments.

  • 2026-27 allocation: Rs 12,200 crore — down 15.7% from actual expenditure of Rs 14,473 crore in 2024-25.
  • Several major states have opted out of PMFBY at various points (Andhra Pradesh, Telangana, Bihar, Jharkhand, Odisha) due to financial burden of premium subsidy sharing.
  • Non-loanee farmer enrollment is a persistent gap — compulsory enrollment was removed in 2020 (PMFBY became voluntary for all farmers), leading to a sharp fall in coverage.
  • Technology-driven yield estimation (satellite remote sensing, smart CCEs) has been mandated to reduce settlement delays, but implementation is uneven across states.
  • RWBCIS (Restructured Weather Based Crop Insurance Scheme) runs parallel, using weather indices for faster trigger-based payouts.

Connection to this news: The PMFBY budget cut deepens existing coverage gaps at a time when climate variability is increasing the frequency and severity of crop failures, contradicting the stated objective of expanding agricultural risk management.

Agricultural Public Investment — Underallocation and Its Consequences

Public investment in agriculture encompasses irrigation (PMKSY — Pradhan Mantri Krishi Sinchayee Yojana), agricultural research (ICAR — Indian Council of Agricultural Research, under DARE), extension services, post-harvest infrastructure (APMC reform, eNAM, cold chains), and soil health management. India's public agricultural investment as a share of agricultural GDP has historically remained below the levels recommended by expert committees.

  • The National Commission for Farmers (Swaminathan Commission, 2004-06) recommended raising public investment in agriculture to at least 4% of agricultural GDP.
  • ICAR budget: comparatively small relative to the size of India's agricultural sector; agricultural R&D intensity (R&D expenditure as % of agricultural GDP) remains below 0.5%, lower than the 1% threshold recommended for developing countries.
  • PMKSY (irrigation scheme) integrates Accelerated Irrigation Benefits Programme (AIBP), Har Khet Ko Pani, and Per Drop More Crop components.
  • e-NAM (National Agriculture Market): online trading platform connecting 1,000+ APMC mandis across 18 states, enabling price discovery and reducing intermediary margins.
  • Post-harvest losses in India are estimated at 4-16% depending on the crop, due to inadequate cold storage and logistics infrastructure.

Connection to this news: The budget analysis reveals that the dominance of income transfer schemes (PM-KISAN) relative to investment in research, irrigation, insurance, and market infrastructure perpetuates low agricultural productivity, even as the nominal headline allocation rises.

Key Facts & Data

  • Agriculture allocation 2026-27: Rs 1.62 lakh crore (up ~7% from 2025-26 RE of Rs 1.51 lakh crore)
  • PM-KISAN 2026-27: Rs 63,500 crore (~45% of agriculture ministry budget)
  • PM-KISAN per-farmer support: Rs 6,000/year (unchanged since 2019 launch)
  • PM-KISAN coverage target: ~9.5 crore farmer families
  • PMFBY 2026-27: Rs 12,200 crore (down 15.7% from Rs 14,473 crore actual in 2024-25)
  • PMFBY is lowest allocation since 2019-20
  • PMFBY became voluntary for all farmers: 2020 (compulsory enrollment removed)
  • Post-harvest losses: 4-16% depending on crop
  • Swaminathan Commission recommendation: public investment ≥4% of agricultural GDP