Agriculture Budget 2020 – For NABARD Grade A Exam 2020

The Government tabled the Union Budget 2020-21 in the Parliament on 1st of Feb 2020. With that in place, we are here with the complete Agriculture Budget 2020 and the Sixteen Action Points for Agriculture, Irrigation and Rural Development. The information given here will be crucial for both Phase 1 and Phase 2 of the NABARD Garde A Exam 2020. Without any more time, let us understand what all the Government has proposed for the development and promotion of Agriculture for the upcoming financial year. 

free mock test oliveboard

Use Coupon Code “D20” to get 20% Off on NABARD Test Series


Agriculture Budget 2020 – For NABARD Grade-A Exam 2020

The Union Budget has been structured on the overall theme of “Ease of Living.” This has been achieved by farmer-friendly initiatives such as

  • Agriculture credit target of Rs 15 lakh crore for 2020-21,
  • Schemes of “Kisan Rail” and “Krishi Udaan” for a seamless national cold supply chain for perishables,
  • Expansion of PM-KUSUM to provide 20 lakh farmers for setting up stand-alone solar pumps.

NABARD Grade A Study plan, Preparation Strategy and Resources

The budget is woven around three prominent themes:

1. Aspirational India in which all sections of the society seek better standards of living, with access to health, education and better jobs.

2. Economic development for all, indicated in the Prime Minister‟s exhortation of “SabkaSaath, SabkaVikas, 

3. Caring Society that is both humane and compassionate, where Antyodaya is an article of faith.

The three components of Aspirational India are:

a) Agriculture, Irrigation and Rural Development,

b) Wellness, Water and Sanitation and

c) Education and Skills

Have you taken up the NABARD Grade A Mock Test yet? If not, take up a Free Mock Test Now.

Agriculture, Irrigation and Rural Development

The Government is committed to the goal of doubling farmers’ incomes by 2022.

  • It had provided energy sovereignty through KUSUM and input sovereignty through Paramparagat Krishi Vikas Yojana.
  • It had provided resilience for 6.11 crores farmers insured under PM Fasal Bima Yojana.
  • Focus on the cultivation of pulses, expansion of micro-irrigation through Krishi Sinchai Yojana, have raised the self-reliance of the country.
  • Provision of any annual supplement of the income to the farmer directly is done through PM-KISAN.
  • Connectivity through PMGSY, financial inclusion has helped raise farm incomes.

Sixteen Action Points for Agriculture, Irrigation and Rural Development

For the sector comprising of Agriculture and allied activities, Irrigation and Rural Development an allocation of about 2.83 lakh crore has been made for the year 2020-21.

Its divided, inter-alia;

a) For Agriculture, Irrigation & allied activities –  1.60 lakh crore
b) For Rural Development & Panchayati Raj –   1.23 lakh crore

1. Encouraging State governments to undertake the implementation of following model laws already issued by the Central Government:

a) Model Agricultural Land Leasing Act, 2016
b) Model Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017 and
c) Model Agricultural Produce and Livestock Contract Farming and Services (Promotion and Facilitation) Act, 2018

2. Comprehensive measures for one hundred water-stressed districts

Water stress-related issues are now a serious concern across the country. The Government has proposed comprehensive measures for one hundred water-stressed districts.

3. PM-KUSUM scheme to be expanded the scheme to provide 20 lakh farmers for setting up stand-alone solar pumps

“Annadata” can be “Urjadata” too.

The PM-KUSUM scheme has removed farmers’ dependence on diesel and kerosene and linked pump sets to solar energy.

Now, It has been proposed to expand the scheme to provide 20 lakh farmers for setting up stand-alone solar pumps; further, Government shall also help another 15 lakh farmers solarise their grid-connected pump sets.

Also, a scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid would be operationalized.

4. Government to encourage balanced use of all kinds of fertilizers 

Government shall encourage balanced use of all kinds of fertilizers including the traditional organic and other innovative fertilizers. This is a necessary step to change the prevailing incentive regime, which encourages excessive use of chemical fertilisers.

5. NABARD to Geo-tag and map warehouses.

India has an estimated capacity of 162 million MT of Agri-warehousing, cold storage, reefer van facilities etc. NABARD will undertake an exercise to map and geo-tag them.

Besides, it has been proposed to create warehousing, in line with the Warehouse Development and Regulatory Authority (WDRA) norms.

Our government will provide Viability Gap Funding for setting up such efficient warehouses at the block/taluk level. This can be achieved, where States can facilitate land and are on a PPP model.

Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) shall undertake such warehouse building on their land too.

6. Village Storage scheme proposed to be run by the SHGs. 

As a backward linkage, a Village Storage scheme is proposed to be run by the SHGs. This will provide farmers with a good holding capacity and reduce their logistics cost. Women, SHGs shall regain their position as “Dhaanya Lakshmi”.

7. Set up a “Kisan Rail” through PPP Arrangements.

To build a seamless national cold supply chain for perishables, inclusive of milk, meat and fish, the Indian Railways will set up a “Kisan Rail” – through PPP arrangements. There shall be refrigerated coaches in Express and Freight trains as well.

8. Krishi Udaan will be launched by the Ministry of Civil Aviation.

Krishi Udaan will be launched by the Ministry of Civil Aviation on international and national routes. This will immensely help improve value realisation especially in North-East and tribal districts.


9. Adopting a cluster basis will focus on “one product one district” for the Horticulture sector.

Horticulture sector with its current production of 311million MT exceeds the production of food grains. For better marketing and export, we propose supporting States which, adopting a cluster basis, will focus on “one product one district”.

10. Integrated farming systems in rainfed areas shall be expanded. 

Integrated farming systems in rainfed areas shall be expanded. Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season will be added. Zero-Budget Natural Farming (mentioned in July 2019 budget) shall also be included. The portal on “jaivik kheti” – online national organic products market will also be strengthened.

11. Negotiable Warehousing Receipts (e-NWR) will be integrated with e-NAM.

Financing on Negotiable Warehousing Receipts (e-NWR) has crossed more than`6000 crore. This will be integrated with e-NAM.

12. Agriculture credit target for the year 2020-21 has been set at 15 lakh crore.

Non-Banking Finance Companies (NBFCs)and cooperatives are active in the agriculture credit space. The NABARD re-finance scheme will be further expanded. Agriculture credit target for the year 2020-21 has been set at ` 15 lakh crore. All eligible beneficiaries of PM-KISAN will be covered under the KCC scheme.

13. Objective to eliminate Foot and Mouth disease, brucellosis in cattle and also peste des petits ruminants (PPR) in sheep and goat by 2025.

Our government intends to eliminate Foot and Mouth disease, brucellosis in cattle and also peste des petits ruminants (PPR) in sheep and goat by 2025. Coverage of artificial insemination shall be increased from the present 30% to 70%. MNREGS would be dovetailed to develop fodder farms. Further, we shall facilitate the doubling of milk processing capacity from 53.5 million MT to 108 million MT by 2025.

14. Blue Economy

Government proposes to put in place a framework for development, management and conservation of marine fishery resources.

15. Fish production to 200 lakh tonnes by 2022-23.

Youth in coastal areas benefit through fish processing and marketing. By 2022-23, I propose raising fish production to 200 lakh tonnes. Growing of algae, sea-weed and cage Culture will also be promoted. Our government will involve youth in fishery extension through 3477 Sagar Mitras and 500 Fish Farmer Producer Organisations. We hope to raise fishery exports to 1 lakh crore by 2024-25.

16. 58 lakh SHGs have been mobilised under Deen Dayal Antyodaya Yojana for the alleviation of poverty.

Under Deen Dayal Antyodaya Yojana for the alleviation of poverty, 58 lakh SHGs have been mobilised. The Government shall further expand on SHGs.

Source: Budget Speech and PIB

This was all from us in this blog of Agriculture Budget 2020. Read and revise it regularly as it will crucial for NABARD Grade-A Prelims and Mains Exams. 

Have you taken up the NABARD Grade A Mock Test yet?

If not, then we would suggest taking up at least the Free Mock Test so that you can design your attempt strategy for the Phase 1 NABARD Grade A. 

We have also prepared Free Agriculture & Rural Development Notes for your extensive preparation.

Refer to them below:

  1. Minimum Support Prices (MSP) – 2018/19: Free NABARD ARD Notes Ebook (PDF)
  2. Water Conservation: Methods and Importance | NABARD ARD Notes
  3. Organizations for Rural Development of India | Free ARD Notes for NABARD
  4. Institutional Financing Agencies | Free ARD Notes for NABARD
  5. Impact of Globalization on Agriculture | Free ARD Notes for NABARD
  6. National Income Accounting – GDP Calculation & Per Capita Income
  7. Poverty Alleviation & Employment Generation – RBI Grade B Study Notes
  8. Fisheries in India – Free ARD Notes for NABARD
  9. Animal Husbandry in India – Types, Importance & more | Free ARD Notes for NABARD
  10. Impact of Climate Change on Agriculture – Free ARD Notes for NABARD
  11. Farm and Agri Engineering – Importance | Free ARD Notes for NABARD
  12. Agricultural Markets: Concept, Classification, and more | Free ARD Notes for NABARD
  13. Agricultural Credit System – Types and Sources | Free ARD Notes for NABARD
  14. Types of Agriculture in India – NABARD Agriculture Notes
  15. Food Security in India – Free Ebook for NABARD Exams
  16. Krishi Vigyaan Kendras – NABARD Agriculture Notes
  17. Agricultural Organisations – India and World | Free ARD Notes E-Book (PDF)
  18. Irrigation: Types of Irrigation, Sources
  19. Agricultural Finance: Classification and Sources – NABARD Agriculture Notes


Schemes Mentioned in the Agriculture Budget 2020

I. PM Kusum Scheme

Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) Scheme

  • It comes under the Ministry of New and Renewable Energy.
  • Objective: Increasing farmers’ income, provide a reliable source for irrigation and de-dieselise the farm sector. 
  • Launched in 2019. 

PM-KUSUM Scheme has three Components:

1. Component-Afor Setting up of 10,000 MW of Decentralized Grid-Connected Renewable Energy Power Plants on barren land: Under this component, renewable energy-based power plants (REPP) of capacity 500 kW to 2 MW will be set up by individual farmers/ group of farmers/ cooperatives/ panchayats/ Farmer Producer Organisations (FPO)/Water User associations (WUA) on barren/fallow land. The power generated will be purchased by local DISCOM at pre-fixed tariff.

2. Component-B for Installation of 17.50 Lakh stand-alone solar agriculture pumps: Under this Component, individual farmers will be supported to install standalone solar Agriculture pumps of capacity up to 7.5 HP for replacement of existing diesel Agriculture pumps/irrigation systems in off-grid areas, where grid supply is not available. Pumps of capacity higher than 7.5 HP can also be installed, however, the financial support will be limited to 7.5 HP capacity.

3. Component-C for Solarisation of 10 Lakh Grid Connected Agriculture Pumps: Under this Component, individual farmers having grid-connected agriculture pump will be supported to solarise pumps. The farmer will be able to use the generated solar power to meet the irrigation needs and the excess solar power will be sold to DISCOMs at pre-fixed tariff.

II. Paramparagat Krishi Vikas Yojna (PKVY)

It comes under the Ministry of Agriculture & Farmers Welfare. To promote organic farming, the government has started the Paramparagat Krishi Vikas Yojana (PKVY), under which 2 lakh hectares has been made suitable for organic farming thereby benefitting 5 lakh farmers.

It is a sub-component of Soil Health Management(SHM) scheme under National Mission of Sustainable Agriculture(NMSA) aims at the development of sustainable models of organic farming through a mix of traditional wisdom and modern science to ensure long term soil fertility buildup, resource conservation and helps in climate change adaptation and mitigation.

It primarily aims to increase soil fertility and thereby helps in the production of healthy food through organic practices without the use of agrochemicals.

PKVY also aims at empowering farmers through institutional development through clusters approach not only in farm practice management, input production, quality assurance but also in value addition and direct marketing through innovative means.

Participatory Guarantee System under PGS-India programme will be the key approach for quality assurances under the PKVY.

The farmers will have the option to adopt any form of organic farming in compliance with PGS-India standards. While adopting a system it must be ensured that the system adopted is compatible with the area and crop and assures optimum yield and provides adequate measures to manage nutrients, pests and diseases.

Farmers will have the flexibility to use an appropriate package of practice(s) best suited to their situations.

Programme Implementation

  • Groups of farmers would be motivated to take up organic farming under Paramparagat Krishi Vikas Yojana (PKVY).
  • Fifty or more farmers will form a cluster having 50-acre land to take up organic farming under the scheme. In this way, during three years 10,000 clusters will be formed covering 5.0 lakh acre area under organic farming.
  • There will be no liability on the farmers for expenditure on certification.
  • Every farmer will be provided at Rs. 20,000 per acre in three years for the seed to harvesting of crops and to transport produce to the market.
  • Organic farming will be promoted by using traditional resources and the organic products will be linked with the market.
  • It will increase domestic production and certification of organic produce by involving farmers.

III. Pradhan Mantri Fasal Bima Yojana (PMFBY)

It comes under the Ministry of Agriculture & Farmers Welfare.


  • To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases.
  • To stabilise the income of farmers to ensure their continuance in farming.
  • To encourage farmers to adopt innovative and modern agricultural practices.
  • To ensure the flow of credit to the agriculture sector.


Following risks leading to crop loss are to be covered under the scheme:-

Yield Losses (standing crops, on a notified area basis): Comprehensive risk insurance is provided to cover yield losses due to non-preventable risks, such as

(i) Natural Fire and Lightning
(ii) Storm, Hailstorm, Cyclone, Typhoon, Tempest, Hurricane, Tornado etc.
(iii) Flood, Inundation and Landslide
(iv) Drought, Dry spells
(v) Pests/ Diseases etc.

The scheme covers yield loss, post-harvest loss and localized calamities.

Premium Rates: 

The rate of Insurance Charges payable by the farmer will be as per the following table:

1. Kharif Season (Food & Oilseeds crops: all cereals, millets, & oilseeds, pulses) – 2.0% of SI or Actuarial rate, whichever is less.

2. Rabi Season (Food & Oilseeds crops: all cereals, millets, & oilseeds, pulses) – 1.5% of SI or Actuarial rate, whichever is less 

3. Kharif & Rabi Season (Annual Commercial / Annual Horticultural crops) –  5% of SI or Actuarial rate, whichever is less.

IV. Prime Minister Krishi Sinchayee Yojana (PMKSY) 

  • Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) was launched on 1st July 2015 with the vision of extending the coverage of irrigation ‘Har Khet ko Pani’ and improving water use efficiency ‘More crop per drop’ in a focused manner with end to end solution on source creation, distribution, management, field application and extension activities.
  • To achieve convergence of investments in irrigation sector at field level. The scheme aims at providing end-to-end solutions in irrigation supply chain, viz. water sources, distribution network and farm level applications. PMKSY not only focuses on creating water sources for assured irrigation but it is also creating protective irrigation by harnessing rainwater at micro level through ‘Jal Sanchay’ and ‘Jal Sinchan’. Micro-irrigation is an integral component of the scheme to maximise water use efficiency at the farm level. PMKSY adopts state-level planning and project execution that allows states to draw up their irrigation development based on District irrigation Plans and State Irrigation Plan.
  • PMKSY has been formulated amalgamating ongoing schemes viz. Accelerated Irrigation Benefit Programme (AIBP) of the Ministry of Water Resources, River Development & Ganga Rejuvenation (MoWR, RD&GR), Integrated Watershed Management Programme (IWMP) of Department of Land Resources (DoLR) and the On-Farm Water Management (OFWM) of Department of Agriculture and Cooperation (DAC).
  • PMKSY has been approved for implementation across the country with an outlay of Rs. 50,000 crore in five years. 

Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) has been launched with the motto of providing “Har Khet Ko Paani” and end-to-end solutions in the irrigation supply chain, viz. water sources, distribution network and farm level applications.

Programme components of PMKSY Components of the PMKSY are as under:

1. Accelerated Irrigation Benefit Programme (AIBP) – to focus on faster completion of ongoing Major and Medium Irrigation projects – being implemented by MOWR, RD&GR.

2. PMKSY (Har Khet ko Pani) – to focus on source augmentation, distribution, groundwater development, lift irrigation, diversion of water from water plenty to water-scarce areas, supplementing rainwater harvesting beyond IWMP & MGNREGA, repair, restoration, renovation of traditional water bodies etc. – being implemented by MoWR, RD&GR.

3. PMKSY (Per Drop More Crop) – to focus on micro-level storage structures, efficient water conveyance & application, precision irrigation systems, topping up of input cost beyond MGNREGA permissible limits, secondary storage,
water-lifting devices, extension activities, coordination & management – being implemented by DAC&FW.

4. PMKSY (Watershed Development) – to focus on ridge area treatment, drainage line treatment, soil and moisture conservation, water harvesting structure, livelihood support activities and other watershed works being implemented by DoLR.

The scheme is to be implemented through the mechanism of Direct Benefit Transfer (DBT). Aadhaar details of the beneficiary are required to access the benefit of the programme. Aadhaar details need to be linked through a web
based registration process.

The pattern of assistance payable to the beneficiary under the micro-irrigation scheme will be 55% for small and marginal farmers and 45% for other farmers which will be met by both the Central Government and State Government in the ratio of 60:40 for all states except the North Eastern and Himalayan states. In the case of these states, the ratio of sharing is 90:10. For the Union Territories, funding pattern is 100% grant by the Central Government.

Use Coupon Code “D20” to get 20% Off on NABARD Test Series


Leave a comment