New Delhi: The Department of Expenditure under the Union Ministry of Finance has issued a formal communication to State Chief Secretaries, advising a strategic realignment of state-level agricultural bonuses to prioritize the cultivation of pulses, oilseeds, and millets. The D.O. letter, dated January 9, 2026, encourages states to harmonize their financial incentives with national goals of nutritional security, sustainable farming, and self-reliance in essential food commodities.
The move seeks to address a persistent imbalance in Indian agriculture, where production remains heavily concentrated on wheat and paddy, particularly in northern regions. When states provide additional bonuses for these staples beyond the Minimum Support Price (MSP) set by the Centre, it further incentivizes monoculture. This trend has resulted in declining acreage for other vital crops, increased environmental stress due to the high water and fertilizer requirements of paddy and wheat, and a heavy national dependence on imported edible oils and pulses.
By advocating for crop diversification, the central government aims to bolster domestic production of oilseeds and pulses to mitigate risks from international supply chain disruptions and price volatility. Recent figures from the Economic Survey 2025–26 indicate progress in this direction, with import dependence for edible oils dropping from 63.2% in 2015–16 to 56.25% in 2023–24. Furthermore, oilseed productivity has seen an increase of approximately 31% over the last decade.
The advisory serves as a component of a broader federal strategy that includes the Mission for Aatmanirbharta in Pulses and the National Mission on Edible Oils. These initiatives are supported by welfare and infrastructure projects such as PM-KISAN, the PM Fasal Bima Yojana, and the Prime Minister Dhan-Dhaanya Krishi Yojana, which targets productivity and irrigation in 100 low-performing agricultural districts. Additionally, the expansion of Mega Food Parks to 41 locations by 2025 has strengthened post-harvest processing capabilities.
This communication emphasizes a collaborative approach to agricultural policy, positioning the shift toward diversification as a shared responsibility between the Centre and the States. The intent is to ensure that state policies complement national efforts to build a more resilient and profitable agricultural sector that secures the interests of both farmers and consumers.