TS to promote oil palm in 2.5L acres with ₹1K cr budget support

Hike in allocation to energy sector falls short of Discoms’ dire need

The agriculture and allied sectors have received over 10.5% of the total outlay of the budget for 2022-23 as the government has allocated ₹24,254 for agriculture sector and another ₹2,769 crore for allied sectors. Although the government has not proposed any new initiatives, it has allocated ₹1,000 crore for promotion of oil palm cultivation.

Rythu Bandhu (₹14,800 crore) and Rythu Bima (₹1,466 crore) scheme garner a lion’s share of the total outlay for agriculture sector. In his budget speech, Minister for Finance T. Harish Rao said the allocation of ₹1,000 crore was to encourage farmers to take up oil palm cultivation. It is being planned to be promoted in 2.5 lakh acres in 2022-23.

Telangana stands sixth in terms of oil palm area in the country with the plantation crop covered in 53,455 acres. However, it stands first in terms of productivity at 8 tonnes of fresh fruit bunches of oil palm per acre and also highest oil extraction rate of 19.22% in 2020-21. The production of crude palm oil in the State is about 0.45 lakh tonnes against the requirement of 3.66 lakh tonnes, according to the socio economic outlook.

Stating that agriculture and allied sectors were contributing over 20% of GSDP, the Minister said it was the outcome of increase in the gross sown area to 2.09 crore acres by 2020-21 from 1.31 crore acres in 2014-15 with the help of scaling up of irrigation facilities, free round-the-clock power supply and investment support given in the name of Rythu Bandhu.

Meanwhile, the power utilities of the State, particularly the two distribution companies (Discoms), which were hoping for a major budgetary support this time to plug their revenue deficit of nearly ₹4,100 crore even after the proposed tariff hike, have nothing to cheer about although the State government has increased the budgetary support to energy sector.

In the budget estimated presented to the State Legislature on Monday, the government has allocated ₹12,210 crore to energy sector, including ₹10,690 crore subsidy given against free power supply to farm sector and subsidised power supplied to few other sections such as hair-cutting saloons, dhobi-ghats and poultry units (₹10,500 crore) and power subsidy given to industries (₹190 crore).

Although the allocation this time is up by nearly 11% or by ₹1,172 crore in monetary terms, it is unlikely to meet the needs of the utilities caught in a debt-trap. The debt of the two Discoms is piling up every year due to revenue gap even after the subsidy subvention and take over of about ₹9,000 crore out of about ₹15,000 crore debt then by the government after they joined the Ujjawal Discom Assurance Yojana scheme in the last quarter of 2016-17.