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Less rain, shrinking crops, and low wages — the rural economy is reeling. May impact rural consumption: Can the Budget steady it?

Published: July 5, 2019

India’s rural economy has been lumbering away, with incomes barely growing. Drought-like conditions in large parts of the country have aggravated the problem. Data indicates that farmers are sowing less this year. High time the government lent a helping hand.

Now that the newly sworn in government is about to present the Budget 2019, all eyes are on if, when and how consumption will pick up in India, especially in the rural economy. Expectations from the Budget are varying, ranging from hopes of bank recapitalisation, to demands for income-tax cuts, adjustments in GST rates, and measures to boost it continues to fund crop loans and direct benefit-transfer schemes, and allocate funds on an emergency basis before rural distress worsens. “We need to keep dispensing cash continuously,” Skymet’s Singh says. “And [invest in] state schemes like the Rythu Bandhu scheme [of the Telangana government, providing credit for farming inputs] before distress strikes.”

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