Budget 2026 – Learning more from Failure than from Success
Seneca, writing in ancient Rome, warned that “Excellence withers without an adversary.” A
millennium later, the insight feels uncomfortably contemporary. India today is witnessing a
paradox of power. The steady collapse of the Indian National Congress under the Gandhi
siblings is hollowing out political contestation. In the absence of a credible opposition,
complacency is most visible in the agricultural economics domain. Surprisingly, there has
been a conspicuous silence from organisations within and those aligned with the BJP on
issues from the Union Budget to the Economic Survey, from the Aravalli ecology to labour;
from electricity to pesticide and seed legislation.
Policies are left to fend for themselves not because they are weak but because no one argues for them, other than the concerned ministers. When agrarian policy is not defended, it loses legitimacy, even before it can hope to deliver. This also erodes the political capital; putting pressure on the Budget to fall on
populism while agrarian reforms get stalled. Agriculture and the budget have a new force to reckon with: the impact of U.S. tariffs. The hard truth is that making a deal with God is no different from making a deal with the Devil. One cannot bargain with a power exponentially greater than oneself, even though the Indian economy has had providence being kind to it. India has enjoyed bountiful monsoons for over
a decade and an extended economic breather from low crude prices. This allows for economic latitude to design policies that deploy resources with greater nuance. Budget allocations are predictable; my instinct is allocations for agricultural R&D will see a substantial hike. Meanwhile, “G-Ram G “is likely to be held at last year’s MGNREGA outlay, even as the scheme quietly shifts an additional 30% fiscal burden on to the states. Such optics mask a deeper shift of fiscal responsibility in federalism. The arithmetic is clear even if
the politics is evasive. Even if one were to accept the Niti Aayog paper on farmer incomes at its face value, farmer incomes have doubled in ‘nominal-terms’ and not in ‘real-terms’. For the first time ever, a larger part of the agricultural household income is coming from ‘non-agriculture’ income and not from their primary profession. This policy-driven suppression of farmgate prices over long periods is triggering a structural and sectoral contagion across the economy. To protect farmgate prices; imports of MSP crops must attract tariffs, calibrated to ensure that the landing cost never undercuts the MSP. Inflation is subdued and foreign exchange reserves are under pressure, which are conditions that actually strengthen the case for such protection. Done right, this would support farmer livelihoods and revive rural consumption without fiscal commitments.
The policies have less to do with inflation than with political control. Polices are also riddled
with contradictions. While the stated objective is natural farming, the bulk of public funding
continues to flow toward chemical fertiliser subsidies (about Rs. 1.70 lakh crore). The
persistent gap between allocation (Rs. 459 crore) and actual utilisation (Rs.30 crore) for
National Mission on Natural Farming only reinforces the point. These figures are dwarfed by
what the budget will not account for: the Eighth Pay Commission, an annual fiscal burden of
roughly ₹2 lakh crores. Call it pessimism if you must. I would rather be described as an
optimist tempered by experience.
When policymakers block out voices from the margins, and evade accountability,
environmental damage is crippling and remains unaddressed. On 2.4 per cent of the world’s
area, India supports 18% of the world’s population & 16% of the world’s livestock population.
Desertification & degradation impacts 30% of the land. Additionally, millions of hectares of
arable land have been gobbled up by urbanization & development, and more is being
released for development mindlessly. In spite of the frightening landscape, policymakers
cannot comprehend how to reverse the damage. It is not that it cannot be reversed like for
the irrigation-induced damage (salinisation and waterlogging) on millions of hectares – over
15 per cent of India’s irrigated cropland – can be addressed by prioritizing allocations for
providing drainage for existing irrigated areas over new flood-irrigation projects.
The cooling of the GDP growth maybe an early indicator of something larger to come, further
complicating the political trade-offs. Tweaking allocations or policies is good optics but not
enough to make Bharat Viksat. The government’s new focus on reforms is
remarkable but these now need to extend to land and agriculture; like a law for land-leasing,
a rethink on land ceiling laws, rationalizing fertilizer and food subsidies or dispersal of
subsidies based on area production plans and allowing futures trading of agricultural
commodities.
The digitisation of the Bharat Krishak Samaj archives (1955–1980) reveals a striking
continuity in policy discourse: many of the foundational recommendations for Indian
agriculture remain substantively unchanged across seven decades. A similar pattern is
evident in successive Union Budgets, it is frustrating to give new recommendations, when
earlier suggestions remain just that.
Let me take one final stab at it though. The establishment of a dedicated ‘Agriculture
Innovation Fund’ to support foundation-level agricultural research. Consider just one
domain: the soil microbiome. It’s the next scientific frontier where we will understand how
life systems in the soil communicate, cooperate and co-evolve. Modern science will converge
with natural farming and ultimately new principles of post-modern agriculture will emerge.
Those working in policy and advocacy have learnt more from failure than from success,
largely because India has had more of the former. A new lesson is the need to curb the vested
influence of external actors by building internal capacity within the government. That begins
with transparency. India needs a Conflict-of-Interest-law, applicable to elected
representatives, IAS officers, and senior management of government-controlled or
autonomous institutions. A state that cannot distinguish between advice and influence,
between expertise and entanglement, slowly surrenders its sovereignty without a vote ever
being cast.
One note of caution is in order. The future, as the warning goes, is nearer than it appears.
Farm indebtedness is accumulating quietly. The government would be well advised to
establish an authority, akin to a debt recovery tribunal, for agricultural loans. In the absence
of such a framework, the pressure for blanket loan waivers will resurface, forcefully, as the
electoral cycle approaches 2029.
Finally, without being ironical but in all earnestness, India’s agricultural plan cannot fail
because India does not yet have one. Transforming the farm sector will take more than intent
(niyat), which is in ample measure in this government; it requires a plan (niti), an
architecture in which the fine print addresses the farmers’ point of view.