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Dr.Ruchira Shukla Asst.Professor Institute of Agribusiness Management Navsari India dawned to independence on 15th of August 1947. The freedom we achieved came from the long struggle of our great national leaders and freedom fighters. But all along the freedom brought with it the responsibility to feed millions of stomachs on our own. The country was not self sufficient in food and food scarcity persisted and famine was looming large. Country was pushed into a “Ship to Mouth Economy”, depending on the external supply for the basic food requirement. It was in this milieu, in the context of 1 st Five Year Plan Pandit Jawarlal Nehru, the then Prime minister commented that: EVERYTHING ELSE CAN WAIT BUT NOT AGRICULTURE.Truly it reflected the urgency of situation and the paramount importance that the great leader attributed to the sector. As a result the Green Revolution emerged followed by the White and Yellow revolutions and finally the Blue revolution. From food scarcity our country marched to food security, and to food surplus. In the present context, to stop and think of the above words in the background of LPG (Liberalisation, Privatisation and Globalisation), the above words still stand as much valid and important as when they were said but in a slightly different sense. Truly the time for Second Green Revolution has come and this time the priorities are slightly different.To go in line with the national growth, the farm output growth should be 4%. Contribution of agriculture to GDP is also not proportional when compared to other sectors. The contribution of agriculture to GDP is only 20% when compared to 54% of the service sector implying that 60% of the population contributes less than a quarter of the Nation’s economic product. On the other side there are challenges raised by the changing international economic scenario. The WTO and related agreements have rendered the world as an open market with wide disparities between members. The member countries of the WTO were compelled to open up their markets to the world resulting in no more preferential protection to the areas like agriculture. This has necessitated an efficiency oriented and market driven production system wherein only those who can offer better products at a lower/ competitive price only can survive in the market. Newer Jargons of Export oriented agriculture; World market share and Value Addition have started lingering in the air. Quality and efficiency have become the key market governing factors. Productivity in agriculture has to go up for efficient utilization of the depleting resources to improve Agriculture’s share in the national product. At present India’s share in the world exports is only 0.60%, which is pittance for a country of our size. All of these call for the need to create newer opportunities in agriculture to retain the same population while effectively utilizing their capabilities. To remain vibrant in the post - liberalization global market driven economy, there is an urgent need to give a facelift to our agriculture from a tradition bound subsistence oriented system to a commercial market driven techno savvy production with a stress on the value addition and preferential marketing and Agri. Exports. Indian Agro Products In several agricultural sectors, India is the world’s leading or one of the largest producers. For example, the country is second largest milk producing country in the world. The agricultural sector in the country is known for its high degree of product diversity. The complementary nature of a number of important Indian agricultural products, in comparison to those produced in west and other countries, provide India considerable export opportunities to these markets. At
out of which. industrial licenses and 100% export oriented units conceiving of an investment of Rs. the Indian agriculture industry is on the brink of a revolution. coir yarn. as the total food production in the country is likely to double in the next ten years. which will modernize the entire food chain.ventures / foreign collaborations and foreign investment. According to recent studies.250000 crores (US $ 69. to 31 % in FY 1980. and to 15.2 billion). competitive pricing of agricultural products and standards. Excellent export prospects. which are internationally comparable have created enormous trade opportunities in the Indian agro industry. the share of value-added food products is around Rs. foreign collaborations.80000 crores (US $ 22. to 18. 9100 crores (US $ 18.2 Billion). This drop in share of agriculture in total exports was somewhat misleading because agricultural products. which were exported in the raw form in the 1950s. they decreased to 32 % in FY 1970. fabrics. such as jute and cotton.80 billion) out of which foreign investment is over Rs. Both in terms of number of joint.present. The Government of India has also sanctioned proposals for joint ventures. The Indian agricultural food industry also assumes significance owing to country's sizable agrarian economy that accounts for over 35% of GDP and employs around 65 % of the population. the consumer food segment has the top priority Exports Agricultural exports were 44 % of total exports in FY 1960.5 % in FY 1988. ready-made garments.19100 crores (US $ 4. and jute manufactures since the 1960s. Exports of Agricultural products (2004-05) . the total turnover of Indian food market is approximately Rs.3 % in FY 1993.4 billion). have been exported as cotton yarn.
Yamen. UAE. UAE & Saudi Arabia UAE. Netherlands. Algeria. Arab Republic & Egypt Indonesia. UK. Bangladesh. Saudi Arabia & Nepal Netherlands. Netherlands. Japan & Netherlands UAE. Belgium Bangladesh. Philippines. Kuwait. UK & Singapore Nepal. The country is expected to strengthen its position among the worlds leading . Germany & Spain Saudi Arabia. Bangladesh. Malaysia. UK. India has to play a bigger role in the global markets in agriculture products in the future. Nepal. Sudan & Myanmar Bangladesh. Pakistan. Nepal & Sri Lanka UAE. Japan. Belgium. USA. UK. Kuwait. Oman. UK. USA. Netherlands & France USA. France. Saudi Arabia Russia. Yamen. Netherlands. South Africa. UK. Germany & Japan Bangladesh. UAE. Netherlands & Germany Pakistan. Bangladesh. USA. Philippines. UAE.Major Export Markets Major destinations for export of Indian agricultural products (2006-07). Pakistan. Sri Lanka & UAE Saudi Arabia. Nigeria. UAE. UAE & Nepal FutureForecasts According to experts. UK. Bangladesh. include Product Floriculture Fruits & Vegetable Seeds Other Fresh Vegetables Fresh Mangoes Fresh Grapes Other Fresh Fruits Dried & Preserved Vegetables Mango Pulp Pickles & Chutneys Other Processed Fruits Poultry Products Dairy Products Groundnuts Cocoa Products Cereal Preparations Basmati Rice Non Basmati Rice Wheat Pulses Major Markets USA. UAE & Ivory Coast Bangladesh. Arab Republic & Kuwait Russia. Malaysia. UAE & Yamen Arab Rep. Netherlands. Nepal. Yamen Arab Republic & UAE USA. UAE. Bangladesh. Sri Lanka.
Food products. recent reports states that agriculture plays an important. technological advancement. considering the global development. Today's Indian farmers' crop growing patterns do not reflect the consumer preference. higher incidence of nuclear families and working women and preference for convenience foods. which is in the offing. in the last few decades. though declining role in Indian economy. most of the countries are enabling and facilitating their domestic agriculture sector. provide necessary . consumer preferences. India is the 5th largest cultivator of biotech crops across the world. have seen a sea change in terms of demand-supply. such as buffalo milk. to below 17.8 million hectares of land were cultivated with genetically modified crops.5 % in 2006. To strengthen the supply chain operations and regular supply of quality raw materials. But with the change in lifestyle.. international trade. The primary GM crop is Bt Cotton that was introduced in 2002. Envisaging the future prospect of processed food. mangoes. such as hygienically packed cut-salad. has a multiplier effect as it will lead to greater efficiencies in supply chain. by about 2. because consumers sought basic staples for cooking meals at their kitchen. offer agribusiness firms new opportunities in the processed food and ready-to-eat segments. The trend reflects that commoditisation of farm produce would no longer be strategy for the agribusiness firms. ahead of China. chickpeas etc. In response of these.3 million farmers. increase in income. In future. In the year 2006. The strategy of pushing large volume of standardised products worked well till now. trading environment. cut-meat and cut-chicken would be visible very soon in the self of Indian retail shops. Agribusiness Strategies for Future: A Perspective Agriculture and food business. In future. supply chain and regulatory frameworks. they have to specialise in the production of certain types of agricultural products. Indian agribusiness firms are adopting backward integration strategy by improving linkages with farmers through contract farming arrangements. Presently it is the 2nd largest rice producer after China and the 3rd largest netexporter after Thailand and Vietnam. new technologies are also being developed to track down the sources. using the latest technologies. However. These concerns would place pressure on food companies to provide complete information about the sources of inputs in their products.The growth of organised food retailing in India. Hence adoption of technology across the value chain such as biotechnology in crop and animal products for productivity enhancement or value-addition to processing/packaging technology for better shelf life would be a novel tool to cater to future food consumers. With the advent of globalisation and agriculture being a focus area in multilateral trade negotiations. depending on the international consumers' demand. spices and bananas. cut-fruits. Its contribution in overall GDP fell from 30 % in the early nineties. technology would be a major driving force in agribusiness. several Indian and multinational companies have entered into joint venture arrangements to undertake significant market development efforts to encourage the consumption of processed foods. but they have to adopt pull strategy through value addition and brand building. which are considered as important in the Indian diet and are also exported. cut-vegetables.exporters of rice. Food safety and traceability of the food ingredients and products have major concerns in international trade. around 3. The country is a world leader in specialist products. cropping pattern.
it is imperative that you familiarize yourself with state.infrastructure such as chilled/frozen space. In order to be a successful in exporting one must fully research its foreign market rather than try to tackle every market at once. A key success factor in starting any export company is clear understanding and detail knowledge of products to be exported. an exporter also becomes safe from offset lack of demand for seasonal products. Why Need to Export There are many good reasons for exporting: The first and the primary reason for export is to earn foreign exchange. by exporting goods. and international laws before starting your export business. No doubt that in the age of globalization and liberalizations. companies that export their goods are believed to be more reliable than their counterpart domestic companies assuming that exporting company has survive the test in meeting international standards. The exporter should approach a market on a priority basis. superior display cabinets for processed dairy products and frozen meat products and reduce the post-harvest losses significantly. Thirdly. international trade keeps an exporter more competitive and less vulnerable to the market as the exporter may have a business boom in one sector while simultaneously witnessing a bust in a different sector. he has an opportunity to start exploring for newer customers. Secondly. The foreign exchange not only brings profit for the exporter but also improves the economic condition of the country. Because there are specific laws dealing with International trade and foreign business. before we go deep into "How to export ?” let us discuss what an export is and how the Government of Indian has defined it. Overseas design and product must be studies properly and considered carefully. Export in itself is a very wide concept and lot of preparations is required by an exporter before starting an export business. free exchange of ideas and cultural knowledge opens up immense business and trade opportunities for a company. the term export may be defined as 'an act of taking out of India any goods by land. Government of India is also supporting exporters through various incentives and schemes to promote Indian export for meeting the much needed requirements for . as one starts visiting customers to sell one’s goods. sea or air and with proper transaction of money”. state-of-the-art machines and vendors in foreign lands. export may be defined as the selling of goods to a foreign country. Lastly. Fifthly. In very simple terms. However. However. Fourthly. Export has became of the most lucrative business in India. federal. As per Section 2 (e) of the India Foreign Trade Act (1992). How to Start Export? It is a fair question that every first time exporter wants to ask.
etc. While planning an export strategy.).but there will be far less buyers. A key factor in any export business is clear understanding and detail knowledge of products to be exported. must be made to adapt them for overseas markets? Which countries are targeted for sales development? In each country. Which products are selected for export development? What modifications. However. On the other hand . . Objectives in the plan should be compared with actual results to measure the success of different strategies. and what strategy will be used to address them? 7. such products will invariably have more sellers and consequently more competition and fewer margins. How will the product's export sale price be determined? 8. the next step is to developing a proper export plan. It is believed that if the products has survived in the domestic market. cultural differences. What will be the cost in time and money for each element? 12. It is not very difficult to find them from various market research tools.importing modern technology and adopting new technology from MNCs through Joint ventures and collaboration. Key Factors in Product Selection • The product should be manufactured or sourced with consistent standard quality. import controls. 3. The selected product must be in demand in the countries where it is to be exported. 6. what is the basic customer profile? What marketing and distribution channels should be used to reach customers? What special challenges pertain to each market (competition. comparable to your competitors • Timely supply is a key success factor in export business • The price of the exported product should not fluctuate very often . 5. practical and flexible export plan for profitable and sustainable export business. What specific operational steps must be taken and when? 9. Before starting an export. if any. 4. if the company’s assets are good enough for export. Further planning for export should be done only.threatening profitability to the export business. 2. Once a businessman decides to sell his products. there is a good chance that it will also be successful in international market. What will be the time frame for implementing each element of the plan? 10. it is always better to develop a simple. at least those where similar needs and conditions exist. Identifying Export Product. the plan should be viewed and written as a management tool. not as a static document.a niche product may have less competition and higher margin . There are products that sell more often than other product in international market. How will results be evaluated and used to modify the plan? From the start. an individual should evaluate his company’s “export readiness”. Export Planning For a proper export planning following questions need to answered: 1. What personnel and company resources will be dedicated to exporting? 11.
Europe. freight and distribution channels . As such. lichee and exotic fruits like sapota. custard apple and other tropical fruits. grapes. green chilies and other seasonal vegetables Many non-traditional vegetables mainly processed & gherkins and other like asparagus. have started going to UK. The shorting method should be done on the basis of various political. drugs and chemicals. Geographical Factors o Country. potatoes and green vegetables like okra. • Carefully study the various government incentive schemes and tax exemptions • Import regulation in overseas markets. economic and cultural factors that will potentially affect export operations in chosen market. Some factors to consider include: 1. Fresh fruits identified as having good export potential are mangoes.g. specially tariff and non-tariff barriers. It involves the screening of large lists of countries in order to arrive at a short list of four to five. state. There is a good international demand for certain fresh fruits as well as processed fruits products. In a small way. bell pepper.. pomegranate. grapes. This mode of transport is very cost effective as there is a saving of 50% on freight when compared to Air. With the commercialisation of refer containers in India. region. which may be bulky or fragile or hazardous or perishable. • Keep in mind special packaging and labeling requirements of perishable products like processed food and dairy products. celery. • Registration/Special provision for your products in importing country. • • • • Market Selection The next step is to start evaluating opportunities in promising export markets. Some of the opportunities for growth in Agriculture and food sector are summarised below: • The country's share in the world trade of processed fruits and vegetables is still less than 1%. abundant investment opportunities are there in the expanding of the export market. green and lime beans and organically grown vegetables are also being increasingly exported.• Strictly check the government policies related to the export of a particular product. Singapore and Hongkong. • • Special measures are required for transportation of certain products. sweet corn. processed mushrooms etc. Among vegetables. the item identified as having good export potential are onions. the exports of mangoes. Middle East. bitter gourd. bananas. This is specially applicable for processed food and beverages. refrigerated trucks are also available for domestic transport. o Time zones. o Urban/rural location logistical considerations e.
The size of the potential audience. publications. Are there appropriate distribution channels for product/service. and if so how big are they? Who are the major importers/ stockists / distributors / agencies or suppliers? What are the other ways to obtain sales/representation? What are the prices or fees in different parts of the market? What are the mark-ups at different distribution levels? . politics etc. o Standards and consumer protection rules. 4. some of the questions that may arise at this stage are: • • • • • • • • Who would your major competitors be? What are the key brands or trade names? What is the market’s structure and shape? What is the market’s size? Are there any niche markets. What the regulatory issues are that impact on exports of product. From the results narrow your selection down to three to five markets and undertake some indepth research relating specifically to your product. Foreign Market Selection ProcessMarket selection process requires a broad range of informations depending upon the products or services to be exported. The library. which includes: • • • • • • • • • • • • The demand for product/service. o Similar products. culture. Market Characteristics o Market size. Economic. o Income and family structure. Whether the target audience can affords product. Demographic Factors o Age and gender. Talking to colleagues and other exporters. The Internet. call centre. Trade and Enterprise – web site. Political.2. Ease of access to this market – proximity/freight. The environment for doing business – language. o Key brands. distributors and suppliers. o Occupation. While doing so. o Cultural beliefs. o Labelling standards. o Duties and taxes 3. o Major competitors. o Availability of domestic manufacturers. Is it financially viable to export to selected market. o Agents. and Legal Environmental Factors o Regulations including quarantine.
Once all the research and analysis is done its time to get registered with the various government authorities. Registration with Export Promotion Council Registered under the Indian Company Act. however. it is necessary to get registered with the DGFT (Director General of Foreign Trade). professional gathers or other events where you can promote your product or service? Packaging – do you need to change metric measures to imperial. development and export of tea. the next step is to plan your entry strategy. DGFT provide exporter a unique IEC Number. or seeking alliances or agreements. IEC Number is a ten digits code required for the purpose of export as well as import. There are a number of options for entering your chosen market. Government of India for purposes of export-promotion and has offices in India and abroad. such as taking more direct control of your market. there are five statutory Commodity Boards under the Department of Commerce. So. you may consider other options. Most exporters initially choose to work through agents or distributors. including compliance and professional registrations if these apply? How will you promote your product or service if there is a lot of competition? Are there any significant trade fairs. to get the benefit of tax exemption it is important for an exporter to get registered with the Tax Authorities. do you need to list ingredients? Will you need to translate promotional material and packaging? Is your branding – colours. At present.• • • • • • What are the import regulations. . Registration of Exporters. Ministry of Commerce. No exporter is allowed to export his good abroad without IEC number. EPC works in close association with the Ministry of Commerce and Industry. Registration with Director General of Foreign Trade (DGFT) For every first time exporter. culturally acceptable? Foreign Market Selection Entry Having completed the market selection process and chosen your target market. Registration with Income Tax Authorities Goods exported out of the country are eligible for exemption from both Value Added Tax and Central Sales Tax. more direct selling or promotion. rubber. Registration with Commodity Boards Commodity Board is registered agency designated by the Ministry of Commerce. These Boards are responsible for production.. Government of India and act as a platform for interaction between the exporting community and the government. In the longer term. spices and tobacco. imagery etc. duties or taxes. Government of India. coffee. Export Promotion Councils or EPC is a non-profit organisation for the promotion of various goods exported from India in international market.
Specialty value goods and gift items. so it’s always better to make an extra effort to understand the exact need of the customer.Quality products strengthen buyer seller relationship. Pricing and costing are two different things and an exporter should not confuse between the two. The foreign customer may ask for product samples before placing a confirmed order. After receiving a lead it is quite important to acknowledge the enquirer within 48 hours of receiving the enquiry either through e-mail or fax.As the buyer is far away and sometimes communication process can be difficult. Presumed relationship between quality and price. Credit offered. a company should respond to that lead in a very carefully manner in order to convert that opportunity into real export deal. it is essential that the samples are made from good quality raw materials and after getting an order. Acknowledgement also gives an option to provide further detail about the product or to make an enquiry about the buyer. there is no fixed formula for successful export pricing and is differ from exporter to exporter depending upon whether the exporter is a merchant exporter or a manufacturer exporter or exporting through a canalising agency. Extra care should be taken in order to avoid the risk associated in sending a costly product sample for export. However. . Determining Export Pricing Export Pricing can be determine by the following factors: • • • • • • • • • Range of products offered. especially if there is a risk of copying the original product during export. It is important for the exporter to keep the prices down keeping in mind all export benefits and expenses. Price is what an exporter offer to a customer on particular products while cost is what an exporter pay for manufacturing the same product. Exporting Product Samples. Export pricing is the most important factor in for promoting export and facing international trade competition. After getting the first lead. Preference or prejudice for products originating from a particular source. so it’s always better to provide quality products to the buyers. Secrecy is also an important factor while sending a sample. Prompt deliveries and continuity in supply. Export Pricing And Costing. consumer durables.Export Sales Leads Export Sales leads are initial contacts a seller or exporter seeks in order to finalize a deal or agreement for export of goods and are considered as the first step in the entire sales process. So. After-sales service in products like machine tools. Frequency of purchase. the subsequent goods are made with the same quality product.Sales leads can be generated either through a word-of-mouth or internet research or trade show participation. Product differentiation and brand image.
Appointing a Sales Agent Selling a product through an overseas agent is a very successful strategy. The key benefit of using an overseas sales agent is that you get the advantage of their extensive knowledge of the target market. Some source of Information on Agents is: • • • • • • Government Departments Trade Associations. appointment with the government as and when required. Good Agricultural Practices (GAP) for Fresh Fruits and Vegetables Fruits and vegetable consumption is an important component of diet of the US consumers who have access to varied types of domestic and exotic fruits from all parts of the world. Chambers of Commerce. Media attention related to foodborne diseases associated with fresh produce caught attention and consequently many food experts have developed a strategy that would reduce the occurrence of microbial contamination. Appointing right sales agent not only enhance the profit of an exporter but also avoid any of risks associated with a sales agent. the same are quoted in the following internationally accepted terms which are commonly known as Incoterm. therefore. As the consumption of fresh produce has increased in USA. It is advisable to prepare an export costing sheet for every export product. Advertisement Abroad. Independent Consultants. Sales agent also provides support to an exporter in the matter of transportation. It consists of fixed cost and variable cost comprising various elements. and the environmental sustainability of agriculture. it was also noticed that there was significant increase in the number of foodborne disease outbreak associated with fresh produce. Banks. Unique value goods and gift items. Export Costing Export Costing is basically Cost Accountant's job. GAP is the application of available knowledge to addressing environmental. not eliminate. Export Promotion Councils. There were few cases where documented evidence had shown that the foodborne illness could be traced back to poor agricultural practices. Consequently. These practices are known as Good Agricultural Practices (GAP). It is. economic and social sustainability for on-farm . the microbial contamination of produce. Sales agents are available on commission basis for any sales they make. food safety and quality. reservation of accommodation. the food retailers have enforced their growers to follow certain growing practices which could reduce.. Prompt acceptance and settlement of claims.• • • Aggressive marketing and sales promotion. essential that one should very carefully select overseas agent.As regards quoting the prices to the overseas buyer. The concept of Good Agricultural Practices (GAP) has evolved in recent years in the context of a rapidly changing and globalising food economy and as a result of the concerns and commitments of a wide range of stakeholders about food production and security. According to the Food and Agriculture Organisation (FAO).
Monitor wash water quality. In addition to growers and packers. fruits and vegetable farmers should adopt it and minimise the risk of contamination. Farmers have to make sure that fresh fruits and vegetables are not shipped in trucks which have carried live animals or harmful substances.Field sanitation and animal exclusion Harvest Clean harvest aids. GAP is formally recognised in the international regulatory framework for reducing risks associated with the use of pesticides. and sanitized them before transporting fresh produce. environmental and safety considerations. rinsed.Packing and Labeling of Goods. taking into account public and occupational health. food service workers.Sanitize packinghouse and packing operations Pre-cooling and cold storage: After harvesting. retailers.Manure storage and sourcing.Manure handling and field application. Branding .Worker hygiene and training Post-harvest Handling Worker hygiene. and production of packages. Packaging also refers to the process of design. There are very few farmers who may be practicing it because of compulsion from the international buyers. If these trucks must be used. right from pre-planting stage of crop to post-harvest stage of the crop. fruits and vegetables should be quickly cooled to minimize the growth of pathogens and maintain good quality. Water bath temperature for cooling should not be more than 10°F cooler than the produce pulp temperature. food handlers such as food processors. Considering the importance of GAP.Selection of appropriate crop Production Measures Irrigation water quality . An important stage after manufacturing of goods or their procurement is their preparation for shipment which involves packaging and labelling of goods to be exported.Irrigation methods. The packaging can be done within the export company or the job can be . and even consumers in their homes have a responsibility for food safety. Proper packaging and labelling not only makes the final product look attractive but also save a huge amount of money by saving the product from wrong handling the export process. it must be ensured that each package leaving the farm can be traced to field of origin and date of packing.production and post-production processes resulting in safe and healthy food and non-food agricultural products. evaluation. For traceability norms. The above-mentioned Good Agricultural Practices (GAP) are still at a nascent stage in India. Transportation of produce from farm to market: Proper cleanliness of the transportation vehicles should be ensured before loading. they should be washed. Packaging The primary role of packaging is to contain. protect and preserve a product as well as aid in its handling and final presentation. is the responsibility of everyone throughout the food system. Refrigeration room should not be overloaded beyond cooling capacity.Timely application of manure. Some of the major risk minimising measures are highlighted below: Pre-planting Measures Site selection. from farm to fork. But it should be thoroughly emphasized that food safety.
. The type of packaging used therefore has an important role in determining the shelf life of a food. and reuse. RFID tags. water vapour and light. handling. oxygen. passive packaging. use. Active Packaging: Active Packaging actively changes the condition of the packaged food to extend life or to improve safety and sensory properties. taste. Packages also can include anti-theft devices. The growing need for information on packaging will mean there has to be a step change in providing this information. The most common example of this type of packaging is a simple plastic bag. characterized by some inherent insulating. With changes in the way food products are produced. stored and retailed. product history or condition to user Assist with opening and indicate seal integrity Confirm product authenticity and act to counter theft The future for packaging Consumer and societal factors are likely to drive the adoption of smart packaging in the future. aroma etc. Intelligent Packaging: Intelligent Packaging monitors the condition of packaged foods to give information about the quality of the packaged food during transport and storage.) Respond actively to changes in product or package Communicate product information. The various packing concepts include. opening. Improved convenience is a value added function that customers are likely to pay extra for as lifestyles change. flavour. distributed. Considering these aspects. Thos is a traditional packaging that involves the use of a covering material. Using packaging in this way is a means of loss prevention. or electronic article surveillance tags. Proper and attractive packaging play an important role in encouraging a potential buyer. sale.assigned to an outside packaging company. reflecting the continuing increase in consumer demand for improved quality and extended shelf life for packaged foods. that can be activated or detected by devices at exit points and require specialized tools to deactivate. Active and Intelligent Food Packaging The main purpose of food packaging is to protect the food from microbial and chemical contamination. Packaging can play an important role in reducing the security risks of shipment. It also provides authentication seals to indicate that the package and contents are not counterfeit. while maintaining the quality of the packaged products. The vision of the future of packaging is one in which the package will increasingly operate as a smart system by incorporating conventional and active . active packaging and intelligent packaging. display. such as dye-packs. are placing greater and greater demands on the performance of food packaging. promotion of convenience and providing product information.Packages can have features which add convenience in distribution. Passive Packaging: Passive Packaging provides protection from external elements such as air and moisture. protective and ease-of-handling qualities. innovative active and intelligent packaging concepts are being developed to • • • • • • Retain integrity and actively prevent food spoilage (shelf-life) Enhance product attributes (look.
This is where branding comes into picture. though it is always better to build a national brand to gain more market acceptability in overseas markets. the products which has "Made in India" logo has to be of superior quality to fulfill the expectations of international consumers. Agricultural and Processed Food Products Export Development Authority (APEDA). they need to be inexpensive relative to the value of the product. With pharmaceuticals. Alphonso mango etc. has developed a system for grant of the certification mark . reliable. There are agri products like Indian Basmati. The only way to break out of the commodity status for the products is by incorporating value into consumer's perceptions of the products. recycle. Thus "Made in India". Labelling should be in English. transport. Darjeeling Tea. a government organisation. such as "This Side Up. 2004 regulations would be promulgated for stricter implementation of it. 2002 and by September 30. food. . It is also important for an exporter to be familiar with all kinds of sign and symbols and should also maintain all the nationally and internationally standers while using these symbols. Brand is the intangible value built into an ordinary product or service that helps it to stand out from the crowd and command premium price. and the dye should not come through the packing in such a way as to affect the goods." Port of entry Labels for hazardous materials Labelling of a product also provides information like how to use. and words indicating country of origin should be as large and as prominent as any other English wording on the package or label. adding value benefits across the packaging supply chain. only harmless dyes should be employed. and chemical products.materials. they are virtually indistinguishable from one another. accurate. Branding With number of products in the international markets increasing. Labelling on product provides the following important information: • • • • • • • • Shipper's mark Country of origin Weight marking (in pounds and in kilograms) Number of packages and size of cases (in inches and centimeters) Handling marks (international pictorial symbols) Cautionary markings. which have its own brand recognition in international market. It has to be supported by product quality and market accessibility.national branding is the identification and use of the positive national values when trying to influence international buyers/consumers. The logo becomes more important when USA guidelines for voluntary labeling of country of origin on imports of various agri commodities (not processed foods) by September. medical. India should take up massive brand building exercise for promoting its agri products under an umbrella "Brand of India" logo. Labeling Like packaging. Henceforth. some types of information are required by governments. For food packed in sacks. labeling should also be done with extra care. reproducible in their range of operation and environmentally benign and food contact safe. or dispose of the package or product.. APEDA's "Quality Produce of India" With a similar view. For materials to be adopted in packaging.
APEDA will also publicise this certification mark globally across media. Minerals. This Certification Mark will be owned by APEDA and only such exporters whose produce / products conform to the prescribed parameters would be allowed / licensed to use the trade mark for exports. Rubber Products. AgMmark Certification AgMark is an acronym for Agricultural Marketing and is used to certify the food products for quality control. Benefits of ISI and Agmark Certification Products having ISI Certification mark or Agmark are not required to be inspected by any agency. implementation of quality assurance system such as ISO 9000. The Board awards the logo selectively to exporters who have certified processing and quality control capability and maintain a high level of hygiene and sanitation at all stages. Ceramic Products. large exporters and manufacturers are allowed to inspect their product without involving any other party. Organic and Inorganic Chemicals. Footwear and Footwear Products. For this purpose. An important aspect about the goods to be exported is compulsory quality control and preshipment inspection.e. BIS main functions include the development of technical standards. Pesticides. Fishery.i. Refractoriness. Self Certification Scheme Under the self Certification Scheme. APEDA will register this Certification Mark globally and its use will be governed by a set of regulations. It includes more than 1000 commodities which are organized into various groups for a compulsory pre-shipment inspection. Export Inspection Council (EIC) was set up by the Government of India under Section 3 of the Export (Quality Control and Inspection) Act. Agmark has been dominated by other quality standards including the non manufacturing standard ISO 9000. The Customs Authorities allow export of such goods even if not accompanied by any preshipment inspection certificate. laboratory facilities and nature of complaint etc. It includes Food and Agriculture. ISI Certification Indian Standards Institute now known as Bureau of Indian Standard (BIS) is a registered society under a Government of India. provided they are otherwise satisfied that the goods carry ISI Certification or the Agmark. Inspection Certificates and Quality Control. Spices Board of India has also launched the Indian Spices Logo to make the international consumer aware about the intrinsic qualities and acquired superiority of Indian spices. Self-Certification Scheme is granted to the exporter for the period of one year. residue testing of pesticides and contaminants. Jute Products.. chemical and allied products and marine products. product quality and management system certifications and consumer affairs. Exporters with proven reputation can obtain the permission for self certification by submitting an . This certification mark will be granted on the basis of compliance with hygiene standards. Coir and Coir Products. food safety system such as HACCP. Light Engineering. "Quality Produce of India" for agricultural products (under APEDA's mandate). backward linkage. Steel Products. 1963. Self-Certification is given on the basis that the exporter himself is the best judge of the quality of his products and will not allow his reputation to be spoiled in the international market by compromising on quality. The facility is available to manufacturers of engineering products. These products do not fall within the purview of the export inspection agencies network.
it becomes important to all the risks related to export in international trade with an extra measure and with a proper risk management. So it is always recommended to properly check the goods to be exported. Legal Risks International laws and regulations change frequently. Established in 1987. Export Inspection Council of India. late payment or even straightforward fraud.application to the Director (Inspection and Quality Control). it becomes difficult for an exporter to verify the creditworthiness and reputation of an importer or buyer. Any false buyer can increase the risk of non-payment. Logistic Risk The exporter must understand all aspects of international logistics. So it is important for an exporter to be constantly aware of the policies of foreign governments so that they can change their marketing tactics accordingly and take the necessary steps to prevent loss of business and investment. or even within the same continent. Therefore. Transportation Risks With the movement of goods from one continent to another. For this an exporter may refer to Incoterms 2000. There is the risk of theft. . So. Like any business transaction. in particular the contract of carriage. Political Risk Political risk arises due to the changes in the government policies or instability in the government sector. it is necessary for an exporter to determine the creditworthiness of the foreign buyer. ISO 9000 is a series of international standards that has been accepted worldwide as the norm assuring high quality of goods. it is important for an exporter to drafts a contract in conjunction with a legal firm. Export is risk in international trade is quite different from risks involve in domestic trade. risk is also associated with good to be exported in an overseas market. goods face many hazards. Expot Risk Management.The various types of export risks involve in an international trade are as follow: Credit Risk Sometimes because of large distance. New Delhi. ISO 9000 The discussion on inspection certificate and quality control is incomplete without ISO-9000. So. Poor Quality Risk Exported goods can be rejected by an importer on the basis of poor quality. thereby ensuring that the exporter's interests are taken care of. ICC publication. Inspection is normally done at the request of importer and the costs for the inspection are borne by the importer or it may be negotiated that they be included in the contract price. The current version of ISO 9000 is ISO 9000:2000. damage and possibly the goods not even arriving at all. This contract is drawn up between a shipper and a carrier (transport operator).
Export risk mitigations are the various strategies that can be adopted by an exporter to avoid the risks associated with the export of goods. Furthermore. seaport and extensive road & railway network. 2500 crore of which Rs. The government supports the sector by providing assistance to farmers for agricultural inputs. geographical region in which these products are grown and adopting an end to end approach of integrating the entire process. It starts with identification of products. A risk management plan helps an exporter to broaden the risk profile for foreign market. The emphasis of the scheme is on market orientation. 2100 crore of which Rs. The state governments also have initiatives in the food processing and cold chain sectors. banana and chikoo. 625 crore are to be provided as subsidy and the rest has to come as private investment. For example the Gujarat government has accorded priority to agro processing and horticulture. developing systems like drip irrigation and encouraging development of infrastructure facilities like warehousing. Government initiatives to promote food exports The Government of India (GOI) has accorded high priority to the establishment of cold chains and encourages major initiatives in this sector. Other states such as Maharastra . 525 crore are to be subsidy and the balance to come as private investment. Andhra Pradesh. cold chain. Kerala and Punjab have similar schemes in place. etc for better pre-harvest and post-harvest crop management. For a small export business. • National Horticulture Board (NHB) operates a capital investment subsidy scheme (CISS) which provides 25% (maximum Rs. Gujarat also has good logistical infrastructure such as airport. • There is no restriction on import of cold storage equipment or establishing cold storages in India. which have a good export potential. right from the stage of production till it reaches the consumption stage The objective of Agri Export Zones of providing remunerative returns to farmers on a sustained basis by improved access to exports. an exporter must keep his risk management analysis clear and simple. in view of the high export potential for fruits like mango. to handle the expected higher agricultural production during the Tenth Plan Period. • Foreign equity participation of 51% is permitted for cold chain projects. and then taking necessary steps to exploit the market potential. leading to final exports. They have also suggested modernization of existing facilities with an investment cost of Rs. Government of India has recommended the creation of additional cold chain facilities at an investment cost of Rs. Agri Export Zones (AEZs): The concept of Agri Export Zone takes a comprehensive view of a particular produce/ product located in a geographically contiguous area for the purpose of developing and sourcing raw materials. the Inter Ministerial Task force on Agricultural Marketing Reforms constituted by Ministry of Agriculture.Exchange Rate Risks Exchange rate risk is occurs due to the uncertainty in the future value of a currency. The entire effort is centred on a cluster approach of identifying the potential products. their processing/packaging. The implementation of projects under the Agri Export Zone is expected to result in .50 lakhs) subsidies to the promoter. Exchange risk can be avoided by adopting Hedging scheme. devising strategies for market penetration and niche marketing.
tomatoes. mango. Ministry of Agriculture provide assistance. oranges. a number of State Governments have also extended similar facilities. The Indian export strategy requires strict adherence to quality standards like ISO 9000 and HACCP to boost exports. Major problems that come across while exporting fresh fruits and vegetables from India include low productivity (cost competitiveness) as compared to global standards.kino. sugar and spices. and mangoes and guavas. in Punjab and Haryana -. Infrastructure and Marketing etc. Dept. It is concluded that the enterprises of Agriculture. . potatoes. Chile and Brazil . mushrooms. Karnataka -. tea. peas. bananas. NHB. rationalising the tax structure and the Food Laws so as to encourage innovation. coffee.litchi and medicinal plants. training on pre-harvest and post-harvest management practices. onions and eggplants. in Kerala --vegetables. For instance. castor and garlic. Quality Upgradation.Further. certain key issues are required to be addressed before the export potential of these commodities can be achieved. Potential fruits identified for increasing the exports include apples. With a view to providing a boost to the sector as also exports from the sector. Israel. whereas Central government Agencies like APEDA. India should also evolve a long term export policy for its agricultural products which should be stable atleast for a reasonable period of 5 years to induce confidence among our exporters. mangoes and chikkoo. prevalence of low level of pre-harvest / post-harvest technologies. For instance. grapes and flower. infrastructural support. cauliflower. export of processed products must take priority over export of raw crops. Potential vegetables identified include garlic. watermelons. cargo facilities at airports/ports.bringing down cost of production. R&D. Gujarat -. Thus. in Tamil Nadu. removal of product-specific and sector specific constraintswould confer much needed competitive ability to exports of Indian processed foods sector. the AEZs would focus on grapes. On account of trade liberalisation multitude of export opportunities prevail for horticulture and floriculture items. and in Uttaranchal -. wheat and rice. provision of required physical and marketing infrastructure such as coldchain facilities. pineapples. These extend from providing financial assistance for Training and Extension. However. international quality standards and existence of distortion in market channels Export potential is also high in case of cash crops such as cotton. Maharashtra -. of Food Processing Industries. Central as well as State Government and their agencies are providing a variety of financial assistance to various agri export related activities. and access to institutional finance for requirements of term loans and working capital.mangoes. cucumbers. processing of these products generates employment and leads to value addition and therefore. enhance product acceptability and competitiveness in the international market and better price realization for agro products. promotion of contract farming. and analyse the success achieved by other countries like Thailand.bananas. Horticulture & Floriculture gained a great deal of commercialisation rather than subsisting farming on account of varied agro climatic zones and specific production technologies. Indian farmers should be backed up with quality standards. mandarins. education on international standards and quality conciousness.vegetables and flowers.
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