Marketing Reforms & Enhancing competitiveness

New Delhi 22-2-2006

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An overview of Indian Agriculture (Production side) Comparative advantages:     Second largest arable land in the world Diverse agro-climatic zones across the country. for India to be a leading food supplier to the world. Round the year sunshine Potential to cultivate a vast range of agricultural products Large marketable surpluses and abundant raw material for processing  Vast pool of skilled manpower in research extension  and These advantages being leveraged. .

Paddy (Million ha) (Million ha) Coarse grains (including maize) Milk Fruits Vegetables Edible Oilseeds Pulses Sugarcane Tea Cattle (million) 186 .Area and production of Agricultural products tonnes) (Production in million India 151 55 72 124 29 91 47 82 25 15 245 0.85 India’s Rank in World Production 2 1 2 2 3 1 2 2 3 1 2 1 2 Arable Land Irrigated Land Wheat Rice.

India - India produces » 41% of world’s mango. $105 bn. » 10% of onion.India is the front ranking producer of many perishable commodities China : $195 bn. » 23% of Banana. » 36% of Green Peas. USA : $150 bn. India has •53% of world’s buffalo and • 17% of goat And a 8000 km of coastline 4 . » 24 % of cashew nut. » 30% of cauliflower.

China. beverages Eastern Europe India . Japan. Western Europe. Australia Carbohydrate Africa (Sub -Saharan) staples Surviving Mass Market ConvenienceQuality Food Service Hygiene Snacking High Technology ource: Rabobank International 5 . Latin America Nortth America. fresh fruits fruit juices.India rising high on food demand curve Evolution of global food demand Diet / functional / organic foods C onvenience foods Snacks / prepared meals Dairy. meat.

World Bank Staff Estimates What is wrong? .India’s competitiveness in global markets dia's share in global production (2001-03) 11% (Large producer) Vegetables Fruits 0% 5% 15% 10% 15% 20% India's share in global exports Vegetables 2.4% 0.5% 2% 4% 6% 8% (1991-93 (2001-03 an prices as a % of world prices (2001-03) 53% (Low cost producer) Vegetables Fruits (Nominal) Fruits 63% 0% 0% 20% 40% 60% 80% 100% Source: UN COMTRADE Statistics.7% 0.1% 1.

3 % 2.3%  USA  France - 80 % 70 %  0.80 %  Thailand India 30 % 1.8% 22% 15% 21% 6%  Malaysia.Food processing still at a nascent stage Level of processing (Fruits & Vegetables) Level of Processing (Perishable products) Organized Unorganized Total Fruits / Vegetables 1.2%  Milk /milk products 13% 21% 6% 8% 35%  Buffalo Meat Poultry Marine Products  7  .

Present Scenario in Value Chain Cost Build Up For One Kg.5 RETAILER Retail Markups 100 160 220 CONSUMER PRICE 350 FARM GATE PRICES 8 MILK FISH FRUITS &VEGETABLES .6 1.3 FARMER TRADER WHOLESALER 2.7 4.1 3. Basket Of Fruit 11.

inadequate  Cold chain .non existent  Transportation for perishables .Domestic markets scenario Infrastructure for marketing of perishables  Primary grading/ collection centers .not permitted Post harvest losses: 25 to 30 % in perishables 9 .complete lack of infrastructure  Wholesale markets .in government control.non existent  Warehousing and cold storage .non existent  Rural markets .non existent  Quality certification system . lack modern facilities  Private / direct markets .

Maharashtra.APMC Reforms . Mizoram States where partially reforms done        Haryana. Goa.Tripura. NCT of Delhi. Karnataka.Status States where reforms not done Orissa. Uttaranchal. Chandigarh. Meghalaya. Pondicherry.  Bihar and Jharkhand 10 . Chattisgarh. UP Gujarat Arunachal. West Bengal.   J&K. Assam.

Maharashtra.2408  Markets reporting data – 1295  Good performing States – AP. Gujarat  States requiring Improvement – HP. Assam. Karnataka.AGMARKNET  Market nodes connected . Things to do: Uttaranchal. Bihar Jharkhand.  Posting data on daily basis  Creating awareness on the information portal  Suggest user-friendly formats for data dissemination  Utilization of funds for market led extension 11 . Kerala.

etc  Poor off-take in  Scope exists for more storage space near to farmers 12 . Punjab. Andhra Pradesh. West Bengal.Rural Godown Scheme  Storage capacity created – 158. Uttaranchal. Madhya Pradesh. Gujarat. Haryana Bihar.68 lakh MTs  Excellent performance Maharashtra.

69 12. in crores 1.27 114.96 1.94 35.59 4.Infrastructure Scheme S.2 28.08 6. 1 2 3 4 5 State No.4 30. of Projects 17 39 35 33 54 178 Financial outlay Rs in crores 15.No .19 1.36 Eligible subsidy Rs.71 1.62 Andhra Pradesh Kerala Madhya Pradesh Punjab Tamil Nadu Total 13 .

62 crores venture capital investment of 125.Venture Capital Scheme  SFAC provides up to 26% of the project equity as Venture capital + PDF for detailed project reports Progress since July. direct employment for 3221 people and assured market to 26.650 families  All States should make use of the scheme 14 .42 crores. 2005  38 projects funded     involving 11.

Terminal market  Hub-and-Spoke Format: Terminal Market (the hub) to be linked to number of collection centres (the spokes). price and quality . Grading. Advisory on input. Banking Transport including reefer vans etc.  Collection centres (Spokes) to be conveniently located at key production centres to allow easy access to farmers  Provide state of art facilities for – – – – – – 15 Electronic auction. Processing and exports. washing and packing lines.

Thanks 16 .

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