From subsidies to smart value chains, Budget 2026–27 reimagines Indian Agriculture through AI, diversification and enterprise-led growth, says Ravindra Boratkar

The Union Budget 2026–27 marks a pivotal moment in India’s agri-economic journey, signalling a calibrated shift from subsistence support to value creation, diversification, and enterprise-led rural growth. With one of the highest-ever allocations for the Ministry of Agriculture and Farmers’ Welfare—estimated between Rs 1.30 lakh crore and Rs 1.63 lakh crore, including input subsidies—the Budget reinforces agriculture and allied sectors as foundational pillars of India’s inclusive and sustainable development agenda.

A defining feature of this year’s Budget is its emphasis on research, innovation, and technology adoption, albeit within a rebalanced funding framework. The budgetary allocation for the Department of Agricultural Research and Education (DARE) stands at approximately Rs 9,967 crore for 2026–27, lower than the previous year’s allocation of Rs 10,281 crore (Budget Estimate for 2025–26), reflecting a reduction of nearly 4.8 per cent in overall research funding. The budget for the Indian Council of Agricultural Research (ICAR) has also seen a marginal cut of Rs 94 crore.

However, this moderation in traditional research outlays is accompanied by a clear strategic reorientation rather than a withdrawal of support. Notably, central agricultural universities have received an additional Rs 132 crore, signalling continued investment in academic capacity-building and human capital development. More importantly, the Budget prioritises digital, AI-enabled, and application-oriented research, aligning scientific outputs more closely with farm-level impact.

This shift is underscored by dedicated funding of Rs 150 crore for Bharat-VISTAAR, a multilingual AI-enabled advisory platform designed to integrate AgriStack portals with ICAR knowledge packages to deliver customised, real-time advisory services. The initiative reflects a decisive move toward data-driven, precision agriculture, opening new opportunities for agri-tech firms, digital service providers, input companies, and advisory platforms.

Beyond research, the Budget places renewed focus on high-value and diversification-led agriculture as a pathway to higher farm incomes. Targeted interventions for coconut, cocoa, cashew, sandalwood, medicinal plants, and natural fibres such as silk, wool, and jute reflect a strategic emphasis on plantation crops, agro-forestry, and export-oriented value chains. Provisions for rejuvenating ageing coconut plantations, expanding orchards, and improving the movement of fruits and vegetables to markets are expected to strengthen supply chains, reduce post-harvest losses, and improve price realisation for farmers.

Among allied sectors, fisheries emerges as a major growth engine, receiving the highest-ever annual budgetary support of Rs 2,761.80 crore. Continued focus on the Pradhan Mantri Matsya Sampada Yojana (PMMSY), with an allocation of Rs 2,500 crore, integrated development of 500 reservoirs and Amrit Sarovars, and improved market linkages involving startups, women-led groups, and Fish Farmer Producer Organisations (Fish FPOs) point to a comprehensive value-chain approach. Progressive measures—such as duty-free fish catch by Indian vessels in the Exclusive Economic Zone (EEZ) and high seas, and recognition of landings at foreign ports as exports—are expected to expand global market access and attract private investment in deep-sea fishing and processing infrastructure.

The Budget further reinforces the role of institutional frameworks, cooperatives, and collective enterprise models. Enhanced tax deductions for primary cooperative societies, the expansion of eligible commodities to include cattle feed and cotton seed, and dividend-related exemptions for national cooperative federations are designed to improve liquidity, incentivise value addition, and strengthen cooperative participation across agri-markets.

Equally significant is the emphasis on women-led rural entrepreneurship. Building on the success of the ‘Lakhpati Didi’ initiative, the introduction of SHE-Mart—community-owned retail outlets in every district—aims to provide wider market access for products made by Self-Help Groups and rural women entrepreneurs. By enabling women engaged in agriculture, animal husbandry, and allied activities to transition from subsistence livelihoods to scalable enterprises, the initiative aligns economic empowerment with grassroots market development.

As articulated by senior policymakers, the Union Budget 2026–27 is not merely an annual financial statement; it is a blueprint for Viksit Bharat, anchored in villages, farmers, women entrepreneurs, MSMEs, and sustainable industries. While the overall Ministry budget has seen a modest increase of around 2.56 per cent, the sharper policy signal lies in the shift toward AI-enabled agriculture, digital infrastructure, and high-value crop ecosystems.

As a B2B agri-industry platform, we view this Budget as a call to action for stakeholders across the value chain—to leverage policy momentum, invest in smarter and cleaner technologies, and align business strategies with emerging priorities in digital agriculture, value addition, and market integration. The coming years will belong to those who align growth ambitions with sustainability, efficiency, and inclusive development—and Budget 2026–27 has laid the foundation for exactly that.

—– Ravindra Boratkar, Publisher & Managing Editor, AgroSpectrum India