India’s Agro-sector: Encouraging Trends

Indian industrialists are increasingly ready to invest in Bharat, term getting popular to represent the rural India. Many philanthropic wings of today’s industry leaders such as the Azim Premji Foundation, the Akshara Foundation and Arghyam Trust are doing wonderful work. Other initiatives such as ITC’s e-Choupal, Hariyali Kissan Bazaar of DCM Shriram Consolidated (DSCL), or Tata Chemicals’ Tata Kisan Sansars are equally impressive.

Many companies and entrepreneurs are getting straight into agriculture business:

1.Global Green, part of Gautam Thapar’s Avantha Group, has already become the third-largest gherkins player in the world.

2.Bharti Del Monte India, a joint venture between Bharti Enterprises and Del Monte Pacific has become the largest exporter of fresh baby corn.

3.Abhiram Seth, a former Executive Director of Pepsi Foods, has set up Aquagri Processing to tap opportunities in sea plant agriculture. Seth aims to grow a particular variety of seaweed used to make carrageenan, an edible jelly-like ingredient used in foods, cosmetics, pet food and toothpastes. He has already organised 800 small farmers for this.

4.Global AgriSystem is working with 400-500 small farmers in Bulandshahar to produce European carrots for the domestic market, but has also bagged orders to export pomegranates, mangoes and grapes.

New thrust is to encourage the farmers for producing what the consumer demands rather than the consuming whatever is produced by the farmer.

New technology is going to collapse the supply chain (earlier, there were up to seven intermediaries between the farmer and the actual buyer).

The Agriculture Produce Marketing Act (APMC Act) permits contract farming, direct marketing and private mandis to improve the linkages between the farmer and the agri-business companies.

Hyderabad-based Sri Biotech Laboratories India makes biological and bioorganic products for crop improvement and protection.

Technology partnerships have led to uniformly ripened fruits such as apples and bananas. Safal from Mother Dairy is setting up a plant to sort, ripen and package bananas.

PepsiCo pioneered contract farming in India and has been able to reach out to more than 20,000 farmers in eight states. Global Green is working with 25,000 farmers in Karnataka, Tamil Nadu and Andhra Pradesh, providing them with seeds, fertilizers, pesticides, technology and a fixed price for the output. Let us see the roadmaps of some companies:

Jain Irrigation bagged a Rs 27 crore order for dehydrated onion from a European retailer. Frito-Lay is investing Rs 250 crore in its existing plant in West Bengal, making it the largest plant in Asia. Freshtrop Fruits is planning to set up a fruit juice venture near Nashik. Himalya International is setting up an agro-processing unit at Mehsana. Mahindra ShubhLaabh has tied up with the Netherlands-based HZPC for potatoes. Citrus International, a Swiss firm, has inked an MoU with the Maharashtra state’s marketing department to set up a Rs 170-crore orange processing plant. Fresh Del Monte Produce has signed banana production and purchase agreement with Rise n’ Shine Biotech. Nature Fresh Logistics India, in partnership with Fruit World Breda B.V., will set up a Rs 9.5-crore pomegranate processing plant at Someshwarnagar.

Macfries served by McDonald’s India requires Shepody potatoes that were once totally imported. By 2010, all the potatoes will be from India and Indian fries may well be travelling the world. Interestingly, the master crop of Shepody potatoes is grown in the Lahaul-Spiti valley in the Himalayas in Himachal Pradesh, where the weather is conducive. After harvesting in September, they are rushed 1,000 kilometres to farmers in Kheda district west of Ahmedabad in Gujarat, where the tubers are replanted. In March, the now massive Shepody potatoes are harvested and sent to the McCain factory in Mehsana to become MacFries.

It is all so much encouraging, but still remains some drops from the ocean of opportunity. Can one think of Chennai growing broccoli and India becoming the largest producer of pomegranate next only to Iran and exporting 35.2 thousand tonnes of fruits valued at Rs 911 million? Six decades on, the dream long cherished by India’s milkman Dr Verghese Kurien to see that India one day exports dairy products to New Zealand is coming true.

Potential of India’s agriculture sector and rural India even after 62 years remain hardly tapped. I wish along with NREGA and food security act, the government works on aggressive empowering of the farmers, field workers, and entrepreneurs in food processing and its infrastructure to bring real prosperity in rural India.

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