Budget 2026: Gov't Allocates Record RM2.62 Bln To Padi Farmers

KUALA LUMPUR, Oct 10 (Bernama) -- The government remains committed to supporting padi farmers, with an RM2.62 billion allocation for subsidies in Budget 2026, the highest sum in the nation's history, said Prime Minister Datuk Seri Anwar Ibrahim.

The Finance Minister said the funding is designated for various subsidies and assistance programmes related to padi prices, crop cultivation, fertiliser, seeds and production incentives.

Beginning this year, the MADANI Government has increased the rates for ploughing and pesticide incentives to RM160 and RM300 per hectare per season, respectively. 

"The MADANI Government is also introducing the new Padi Harvesting Incentive of RM50 per hectare per season to help offset the cost of diesel for harvesters.

"It is estimated that each farmer will now receive approximately RM4,300 per hectare in assistance each season, a significant increase from the previous RM3,790," he said when tabling the Budget 2026 in the Dewan Rakyat today.

To further strengthen the padi industry, Anwar announced that Phase 1 of the Tertiary Irrigation System for the Five Seasons in Two Years Padi Planting Project in the Muda Agricultural Development Authority (MADA) area of Kedah and Perlis has been completed. The project is slated to be completed in phases by the second quarter of 2030.

He said the RM1.28 billion Jeniang Water Transfer Project will commence next year, involving creating a new river for irrigation to support the Five Seasons in Two Years planting programme.

"In addition, RM100 million is allocated to rehabilitate and upgrade the infrastructure of problematic padi fields with modern, technology-driven farming models. 

"To enhance harvest yields, 6,400 farmers will be supplied with foliar fertiliser to improve crop nutrition and soil fertility, with an allocation of RM20 million," he said.

Since 2024, Anwar noted that the MADANI Government has collaborated with all state governments to optimise land use for agricultural projects, implementing over 360 projects encompassing crops, livestock, fisheries and agricultural automation to date. 

"Next year, this collaboration will be intensified with an allocation of RM300 million to support, among other initiatives, grain corn cultivation, aquaculture farming, and padi planting in Sabah and Sarawak," said Anwar. 

Anwar further announced that Agrobank has made RM1.1 billion in financing available for agricultural entrepreneurs, to help businesses expand and support automation and mechanisation.

In addition, the Agropreneur NextGen programme under the Ministry of Agriculture and Food Security (KPKM) will provide start-up and expansion grants through a RM20 million fund.

"In a move to boost food production, the government proposes that companies involved in new food production projects be granted a hundred percent income tax exemption on their statutory income for 10 years.

"Existing companies undertaking expansion projects will be given a hundred percent income tax exemption on their statutory income for five years. The application period for these tax incentives will be extended until Dec 31, 2030," he said.

For the fishing community, Anwar announced an allocation of RM160 million to provide a living allowance of up to RM300 per month and catch incentives for fishermen.

The government will also maintain the subsidised diesel price of RM1.65 per litre specifically for this sector.

He added that RM20 million has been allocated to help fishermen upgrade their vessels, to reduce reliance on foreign skippers and crew.

This fund is also meant to replace Zone B trawler nets and two-boat "kenka" nets to decrease the number of unsustainable fishing vessels.

A further RM55 million is allocated to support local fruit growers, with incentives and infrastructure funding for planting pineapples (including in Sarawak) and other crops like soursop, water guava, and pomelo.

-- BERNAMA