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Step up agri-spending, boost farm incomes

  • Published
    9th Feb, 2022

While the overall budgetary allocation towards the agricultural sector has marginally increased by 4.4% in the Union Budget 2022-23, the rate of increase is lower than the current inflation rate of 5.5%-6%. The picture changes and rather looks disappointing when we look at the Agriculture Orientation Index (AOI) 

What is Agriculture Orientation Index (AOI)?

  1. It is an index which was developed as part of the Goal 2 (Zero Hunger) of the 2030 Agenda for Sustainable Development in 2015.
  2. The AOI is calculated by dividing the agriculture share of government expenditure by the agriculture value added share of GDP.
  3. It measures the ratio between government spending towards the agricultural sector and the sector’s contribution to GDP. India’s index is one of the lowest, reflecting that the spending towards the agricultural sector is not commensurate with the sector’s contribution towards GDP.
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