As the Union Budget 2026 draws closer, the market will be looking towards the Finance Minister's speech for the latest updates on the agricultural sector. Agriculture is increasingly being recognised not merely as a welfare sector, but as a credible engine of economic growth; one that can drive productivity, employment, rural demand and resilience, as per experts.
India’s agriculture market is projected to grow to Rs 38 lakh crore by FY30 from Rs 31 lakh crore in FY25, according to a report, growing at a clip of 4 percent per annum.
"With agriculture and allied sectors supporting a large share of India’s workforce and contributing significantly to consumption-led growth, the Budget presents an opportunity to reposition the sector at the centre of India’s medium-term economic strategy," suggested Amit Vatsyayan, Leader GPS-Agriculture, Livelihood, Social and Skills, EY India.
The push toward climate resilient and sustainable agriculture is gathering pace, with policymakers and industry stressing green infrastructure as a growth multiplier. As Amit Vatsyayan of EY India noted, “a decisive starting point lies in scaling green infrastructure and climate resilient irrigation.”
Digital agriculture is emerging as a key theme, with agritech solutions moving from pilots to scale. Amith Agarwal of StarAgri said Indian agriculture needs “deeper digitisation, stronger technology adoption, and greater farmer participation online.”
There is a gradual shift in policy thinking from yield maximisation to nutrition outcomes, with biofortified seeds and nutrition focused farming gaining attention.
Despite employing nearly half the workforce, agriculture continues to suffer from low productivity and limited value addition. As Soumyak Biswas of BDO India pointed out, the sector “contributes only around 18 percent to national GVA, despite having 45 percent of the national workforce reflecting low productivity, limited value addition, and persistent structural challenges.”
Post harvest losses remain high due to gaps in storage, cold chains and processing infrastructure, noted experts.
Further, access to formal credit and insurance remains uneven, particularly for small farmers, prompting calls for a rural specific lending framework.
Strong emphasis on productivity, seed innovation and sustainable farming, with agriculture positioned as a key growth engine.
Support for digital agriculture initiatives and public digital infrastructure. Continued focus on allied sectors and climate resilient practices, though scale and execution remain key challenges.
Higher investments in green infrastructure, irrigation and value chain modernisation through public private partnerships, as Vatsyayan said “productivity gains must be complemented by value chain modernisation.”
Faster rollout of AGRISTACK as a digital public good to integrate farmer data, credit, insurance and markets, helping “reduce transaction costs and crowd in private investment.”
A differentiated rural credit framework and stronger push for nutrition led agriculture, with Prateek Rastogi of Better Nutrition arguing that “India’s next leap must go beyond yield and move toward nutrition as an outcome.”
Also Read | Union Budget 2026: Market expects sustained capex push, limited surprises for roads and railways
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