Budget 2026: Industry Urge Focus on Farm Resilience, Higher Incomes and Sustainable Rural Prosperity

As India prepares for the Union Budget for FY 2026-27, expectations are rising that agriculture and allied sectors will move beyond incremental support toward deeper structural reforms. Industry leaders across agritech, biofuels, nutrition and dairy are urging the government to build on recent gains by focusing on value creation, resilience and inclusive growth rather than headline announcements alone.

For Anand Chandra, Co-Founder and Executive Director of agribusiness platform Arya.ag, the priority lies close to the farmgate. He points to the growing impact of decentralised infrastructure such as micro-warehousing and scientific storage, which allow farmers to avoid distress sales and time the market better. “Timely and accessible credit at the farmgate has enabled more farmers, especially women and youth, to hold their produce and access better markets,” he says.

Chandra expects Budget 2026 to continue backing these proven interventions. According to him, decentralised infrastructure, inclusive finance and stronger farmer producer organisations (FPOs) are critical to strengthening the rural economy and building climate resilience where it is most needed. He also underlines the role of agritech startups deploying drones, AI-based quality grading and climate advisories. “These tools must work for smallholders - simple, affordable and effective in low-resource settings. With the right support, such innovations can directly enhance productivity, reduce losses and create new rural livelihoods,” he adds.

Tackling surplus ethanol capacity
Beyond food grains, policymakers are also being urged to look at agriculture’s growing role in energy and industrial transitions. Dr Sangeeta Srivastava, Executive Director at Godavari Biorefineries Ltd, says India’s early achievement of E20 ethanol blending has created a new challenge - surplus capacity. She believes Budget 2026 must focus on demand-side measures such as incentivising E100-ready infrastructure and accelerating mandates for Sustainable Aviation Fuel (SAF).

According to Srivastava, this will help absorb excess ethanol while enabling a strategic shift toward ethanol-to-chemicals and high-value bio-based derivatives. “This Budget must provide the fiscal framework to move from fuel blending to global leadership in the sustainable chemical economy,” she says, positioning biofuels as a key industrial growth lever.

Nutrition focused agriculture 
Nutrition is another area where experts say India must now go beyond yields. Prateek Rastogi, Co-founder and CEO of Better Nutrition, notes that while last year’s Budget rightly positioned agriculture as India’s first growth engine, the next leap must focus on outcomes. “We don’t suffer from a lack of food. We suffer from a lack of nutrients in our food,” he says.

Rastogi calls for mainstreaming biofortified seeds and nutrition-focused agriculture within national policy. By addressing iron, zinc and micronutrient deficiencies at the seed and crop level, he argues, India can improve public health while creating higher-value markets for farmers. Supporting startups and farmer networks that grow and process nutrient-rich crops could improve price realisation and ensure assured demand, linking farm incomes directly with better nutrition.

Meanwhile, the broader agricultural ecosystem is also watching for continued public investment. Budget 2026 is expected to increase capital allocations for irrigation, post-harvest infrastructure and rural logistics, while expanding eNAM, data-driven advisories and remote sensing to improve efficiency and price discovery. MSP policy is likely to remain central, with expectations of wider regional coverage and quality-linked procurement.

Dairy: value over volume
The dairy sector, a backbone of rural livelihoods, is another major focus. India’s milk production has surged from about 146 million tonnes a decade ago to over 239 million tonnes in 2023–24, with per-capita availability far above global averages. However, policymakers are now expected to prioritise value over volume.

Brahmani Nara, Executive Director of Heritage Foods Ltd, says recent GST rationalisation has boosted organised dairy and shifted consumer demand toward high-protein and health-focused products. For Budget 2026, she outlines three priorities: subsidised access to quality feed and chromosome-sorted semen, expanded veterinary education capacity, and higher capital subsidies for mini-dairy units, particularly for women entrepreneurs.