Embed Size (px)
Citation preview
Agro and Food processing Industry in India: Status,
Opportunities & Challenges
Ajay H Shukla & Swapna D Pawar
Asst. Prof. at Matoshri College of Management & Research Centre
[email protected], [email protected]
902121 7110.
ABSTRACT
“Agriculture and industry have traditionally been viewed as two separate sectors both in
terms of their characteristics and their role in economic growth, however over as few
decades Agro and food process has rapidly expanded as an Organized industry with a
bright role to be played in Socio-economic development of a country. Our paper
endeavors to put an insight on the status and evolution of this industry in India,
encompassing the Govt. reforms, subsidiaries, Incentives, technological development,
R&D, export potential, growth trajectory, constraints, competition etc by interviewing
various related Entrepreneur in the field with a focus to get a hawk eye view from the
horses mouth. Based on which we propose to come up with an industry oriented action
plan to foster the growth and advancement of the Industry and people attach to it.”
1.0 Introduction:
`Agro-industry' is an omnibus expression. It could cover a variety of
industrial,manufacturing and processing activities based on agricultural raw materials as
also activities and services that go as inputs to agriculture.The agro-industries
corporations, set up during the 'sixties in most states, have mainly been engaged in supply
of farm machinery, fertilizers, seeds and other modern inputs available to farmers.
Food processing industry in India is a sunrise sector that has gained prominence over the
recent years. Availability of raw materials, changing lifestyles and appropriate fiscal
policies has given a considerable push to the industry’s growth. This sector serves as a
vital link between the agriculture and industrial segments of the economy. Adequate
focus on this sector could greatly alleviate our concerns on food security and food
inflation. Strengthening this link is of critical importance to reduce waste of agricultural
raw materials, improve the value of agricultural produce by increasing shelf-life as well
as by fortifying the nutritive capacity of the food products; ensure remunerative prices to
farmers as well as affordable prices to consumers. India already is a leading exporter of
several food products. To ensure that this sector gets the stimulus it deserves, Ministry of
Food Processing Industries is implementing a number of programmes for Infrastructure
development, technology up-gradation & modernization, human resources development
and R&D in the Food Processing Sector.
As per the GOI (Ministry) food processing industries, includes items pertaining to these
two processes viz. (a) Manufactured Processes: If any raw product of agriculture, animal
husbandry or fisheries is transformed through a process [involving employees, power,
machines or money] in such a way that its original physical properties undergo a change
and if the transformed product is edible and has commercial value, then it comes within
the domain of Food Processing Industries and (b) Other Value-Added Processes: Hence,
if there is significant value addition (increased shelf life, shelled and ready for
consumption etc.) such produce also comes under food processing, even if it does not
undergo manufacturing processes.
The Ministry of Food Processing Industries does not deal with a few food items such as
coffee, tea, oilseeds, spices etc. as the allocation of these items are with other Ministries
under the Allocation of Business Rules for Central Ministries. However, all these items
are also included in the data base in order to provide a Comprehensive picture of the
industry.
Another useful classification of agroprocessing industry is in upstream and downstream
industries. Upstream industries are engaged in the initial processing of agricultural
commodities. Examples are rice and flour milling, leather tanning, cotton ginning, oil
pressing, saw milling and fish canning. Downstream industries undertake further
manufacturing operations on intermediate products made from agricultural materials.
Examples are bread, biscuit and noodle making, textile spinning and weaving; paper
production; clothing and footwear manufacturing; and rubber manufactures
1.1 Research Methodology:
The study was conducted with following objectives
i. To get an overview of Agro processing as an organized industry in current
Market scenario.
ii. To undertake a prose con analysis of industry with reference to the growth
potentials available & constraints faced by the Industrialist.
iii. To come up with a valuable suggestions to the Industry and Government so as
to facilitate the growth and performance of industry.
The methodology followed includes utilization of both primary and secondary data.The
primary data was collected by interacting with experts from diversified Agro processing
Industries like Winery, Rice and Bhagar processing Industry, Ayurvedic and herbal
products, Dairy and Allied product etc with a view to get a detailed insight from the
people actually on the field
The secondary data includes data collected from study of various reports published by
respective Ministry, Government Authorities and Researchers. Some of the statistical
data has been borrowed from related books and journals.
2. Historical Review:
2.1 Origin of Agriculture:
The beginning of 'agro' or 'agriculture' marks the beginning of 'civilized' or 'sedentary'
society. Climate change and increase in population during the Holocene Era (10,000 BC
onwards) led to the evolution of agriculture. During the Bronze Age (9000 BC onwards),
domestication of plants and animals transformed the profession of the early Homo
sapiens from hunting and gathering to selective hunting, herding and finally to settled
agriculture. Eventually the agricultural practices enabled people to establish permanent
settlements and expand urban based societies. Cultivation marks the transition from
nomadic pre-historic societies to the settled neolithic lifestyle some time around 7000
BC.
As per the modern definition of agriculture which would be" an aggregate of large scale
intensive cultivation of land, mono-cropping, organized irrigation, and use of a
specialized labor force", the title "inventors of agriculture" would go to the Sumerians,
starting ca. 5,500 BC.
The Renaissance saw the innovation of the three field system of crop rotation and wide spread
usage of the moldboard plow. The early phase of Industrial Revolution witnessed new
agricultural practices like enclosure, mechanization, four-field crop rotation and selective
breeding. The science-driven innovations of 19th and 20th centuries led to the mechanization of
the cultivation, i.e. the use of tractors.
2.2 India’s Tryst with Green Revolution
Agriculture in India, the preeminent sector of the economy, is the source of livelihood of
almost two thirds of the workforce in the country. The contribution of agriculture and
allied activities to India's economic growth in recent years has been no less significant
than that of industry and services. The importance of agriculture to the country is best
summed up by this statement: "`If agriculture survives, India survives".
Policy makers and planners, in order to address the concerns about national
independence, security, and political stability realized that self-sufficiency in food
production was an absolute prerequisite. This perception led to a program of agricultural
improvement called the Intensive Agriculture District Programme (IADP) and eventually
to the Green Revolution. The National Bank for Agriculture and Rural Development
(NABARD) was set up. All these steps led to a quantum jump in the productivity and
production of crops.
2.3 Technological devlopment in the field of agroprocessing industry:
As per the Study by R. P. Kachru Asstt. Director General (Process Engineering),
Indian Council of Agricultural Research, New Delhi. R&D Work in agro-processing
carried out in India during the last 50 years categorized as follows:
o Studies on physical, biochemical, nutritional, and engineering
properties/characteristics of different food, feed, fibre, and industrial raw
materials.
o Response studies of different biological materials w.r.t. their storage, handling,
and moisture conditioning.
o Refinement of traditional equipment and processes for production of different
foods, feeds, fibres and fuel materials for better quality, higher capacity, energy
efficiency, and reduced drudgery to workers.
o Development of new produces and processes for better nutrition, convenience
and taste.
o Enhancement of shelf life of the produces, safe storage/packaging and
development of better performing materials.
o Better economic utilization of agricultural residues, by-products and recycling of
wastes.
o Design and Development of instruments and equipment for post harvest
operations and their evaluation, feasibility analysis, field trails/multilocation
evaluation etc.
o Design, layout planning and development of pilot plants, agricultural produce
bulk handling systems and area specific agro-processing models.
o Studies and modeling/simulation of post harvest systems and industry for the
purpose of optimization, forecasting and policy analysis.
o Energy auditing and use of non-renewable sources of energy for post harvest
operations.
o Product quality analysis, sensory evaluation and consumer acceptance studies.
o Work conditions, safety and pollution control.
Among large number of technologies developed, themost popular ones include:
1. Agriculture produce refinement equipment such as, cleaners, graders and driers for on-
farm operations as well as industrial operations.
2. Processes and equipment for parboiling of rice, preparation of puffed rice and flaked
rice.
3. Development of processes and equipment for processing of pulses to produce dhal for
higher recovery and better quality.
4. Development of driers using agricultural residues, by-products and solar energy.
5. Adoption and development of processes, and equipment for production of protein rich
produces such as full fat soy flour, soy drink/ soy milk, soy paneer (TOFU) and soy
fortified baked products.
6. Development of equipment such as, leaf cup and dona making machine, multipurpose
mills, mini flour mill, grain pearlers, maize dehuskers, shellers, groundnut decorticators,
fruit graders, juice extractors, high recovery mechanical oil expellers and improved
storagenergy efficiency, and reduced drudgery to workers.
7. Processes and equipment for production of high quality ground spices and spice mix,
development of raw materials and processes for production of instant sweets, curries,
snack foods, instant soft drinks, idli, dosa, sambhar mixes/powders, egge structures for
cereals, pulses, oilseeds, onion and potato.
3.Policy Initiatives towards the development of Agroprocessing sector:
After liberalization several policy measures have been taken with regard to regulation and
control, export and import, fiscal policy, exchange and interest rate control taxation,
export promotion and incentives to high priority industries. Food processing and agro
industries have been accorded high priority with a number of important relieves and
incentives. The objective of every policy initiative has been to make Indian agriculture
globally competitive — by investing it with the ability to produce globally acceptable
quality at comparable cost some of the important policy changes towards food processing
industry are as follows
3.1 Regulation and Control:
o Most of the processed food items have been exempted from the purview of
licensing under the Industries, Development and regulation, Act, 1951, except
items reserved for small-scale sector and alcoholic beverages.
o As per extent policy Foreign Direct Investment up to 100% is permitted under the
automatic route in the food infrastructure like Food Park, Cold Chain and
warehousing.
o Asfar as food retail is concerned the FDI policy does not permit FDI into retail
sector except Single Brand Product Retailing. This policy is uniform for all
retailing activity.
o FDI policy for manufacture of items reserved for the Small Scale Industry sector
is uniform for all items so reserved and a separate dispensation for items in the
food-processing sector is not contemplated.
o The policy for distillation of alcohol has been announced vide Press Note 4
(2006) according to which FDI upto 100% is permitted on the automatic route for
distillation and brewing of alcohol subject to licensing by the appropriate
authority.
o No industrial license is required for almost all of the food and agro processing
industries except for some items like beer, potable alcohol and wines, cane sugar,
hydrogenated animal fats and oils etc. and items reserved for exclusive
manufacture in the small scale sector. Items reserved for S.S.I. include pickles and
chutneys, bread, confectionery, excluding chocolate, toffees and chewing-gum
etc., rapeseed, mustard, sesame and groundnut oils (except solvent extracted),
ground and processed spices other than spice oil and oleoresins, sweetened
cashew nut products, tapioca sago and tapioca flour.
o Use of foreign brand names is now freely permitted the government.
o MRTP (Monopolies and Restrictive Trade Practices Act) rules and FERA
(Foreign Exchange Regulation Act) regulations have been relaxed and given more
freedom to encourage investment and expansion by large corporates.
o Most of the items can be freely imported and exported except for items in the
negative lists for imports and exports. Capital goods are also freely importable,
including second hand ones in the food-processing sector.
3.2 Fiscal policy and taxation:
o Custom duty rates have been substantially reduced on food processing plant and
equipments, as well as on raw materials and intermediates, especially for export
production.
o Wide-ranging fiscal policy changes have been introduced progressively in food
processing sector. Excise and Import duty rates have been reduced substantially.
Many processed food items are totally exempt from excise duty.
o Corporate taxes have been reduced and there is a shift towards market related
interest rates. There are tax incentives for new manufacturing units for certain
years, except for industries like beer, wine, aerated water using flavouring
concentrates, confectionery, chocolates etc.
o Indian currency, rupee, is now fully convertible on current account and
convertibility on capital account with unified exchange rate mechanism is
foreseen in coming years.
o Repatriation of profits is freely permitted in many industries except for some,
where there is an additional requirement of balancing the dividend payments
through export earnings.
3.4 Export promotion Scemes :
o Food processing industry is one of the growing areas identified for exports. Free
Trade Zones (FTZ) and Export Processing Zones (EPZ) have been set up with all
infrastructures. Also, setting up of 100% Export oriented units (EOU) is
encouraged in other areas. They may import free of duty all types of goods,
including capital foods.
o Capital goods, including spares upto 20% of the CIF value of the Capital goods
may be imported at a concessional rate of Customs duty subject to certain export
obligations under the EPCG scheme, Export Promotion Capital Goods. Export
linked duty free imports are also allowed.
o Units in EPZ/FTZ and 100% Export oriented units can retain 50% of foreign
exchange receipts in foreign currency accounts.
o 50% of the production of EPZ/FTZ and 100% EOU units is saleable in domestic
tariff area.
3.4.1 Agro Processing Export Scenario:
Major Trading Partner of India
1) Bangladesh
2) U.A.E
3) Saudi Arabia
4) Malaysia
5) U.S.A.
6) Kuwait
7) U.K.
8) Indonesia
9) Yamen Arab Republic
10) Cote D Ivoire
3.5 Institutional support for the development of Agro and food processing sector
There are various institutions providing assistance to food and agro processing industries:
1) APEDA - APEDA is an Agricultural & Processed Food product Export
Development Authority of Min. of Commerce & Industry, Govt. of India and is
engaged in augmenting, promoting and monitoring the exports of agro products
including rice. It also provides financial assistance to merchant & industrial exporters
and has formulated various schemes approved by Govt. of India.
APEDA provides financial assistance to its registered member exporters under the
following schemes:
o Scheme for Market Development
o Scheme for Infrastructure Development
o Scheme for Quality Development
o Scheme for Research and Development
o Scheme for Transport Assistance
2) CFTRI: The Institute has geared up its R&D and impact of the globalisation has
given very good dividends with a large number of externally funded projects from
national and international agencies. The present scenario in the country is very
vibrant with rising capital investment in food industry, which is expanding at a
rapid pace in urban markets for processed foods, especially for the traditional
foods through eco-friendly technologies.
The role of CFTRI has always been on a high pedestal in the areas of human
resource development and R&D partnerships cherished through the international
linkages with institutions such as the Institute of Food Technologists (USA), UN
University (Tokyo), European Economic Commission (Belgium), National
Science Foundation (USA) and many more. CFTRI is an ISO 9001:2008 and ISO
14001:2004 organisation and NABL accredited for chemical and biological
testing of samples.
3) ICAR: The Council is the apex body for co-ordinating, guiding and managing
research and education in agriculture including horticulture, fisheries and animal
sciences in the entire country. With 97 ICAR institutes and 47 agricultural
universities spread across the country this is one of the largest national
agricultural systems in the world.
the ICAR has played a pioneering role in ushering Green Revolution and
subsequent developments in agriculture in India through its research and
technology development that has enabled the country to increase the production
of foodgrains by 4 times, horticultural crops by 6 times, fish by 9 times (marine 5
times and inland 17 times), milk 6 times and eggs 27 times since 1950-51, thus
making a visible impact on the national food and nutritional security. It has played
a major role in promoting excellence in higher education in agriculture. It is
engaged in cutting edge areas of science and technology development and its
scientists are internationally acknowledged in their fields.
4) MPEDA: he Marine Products Export Development Authority (MPEDA) was
constituted in 1972 under the Marine Products Export Development Authority Act
1972 (No.13 of 1972).
Work Programme of MPEDA
o Registration of infrastructure facilities for seafood Export trade
o Collection and dissemination of trade information
o Projection of Indian marine products in overseas markets by participation
in overseas fairs and organizing international seafood fairs in India.
o Implementation of development measures vital to the industry like
distribution of insulated fish boxes, putting up fish landing platforms,
improvement of peeling sheds, modernization of industry such as
upgrading of plate freezers, installation of IQF machinery, generator sets,
ice making machineries, quality control laboratory etc.
o Promotion of aquaculture for production of shrimp and prawn for export.
5) National Dairy Reaserch Institution:
The National Dairy Research Institute as country's premier Dairy Research
institution has developed considerable expertise over the last five decades in
different areas of Dairy Production, Processing, Management and Human
Resource Development. Information generated at the Institute and the services
offered have contributed to the growth of Dairy Industry as a whole and well-
being of millions of milk producers and consumers of milk and milk products.
Realizing the challenging need of global Dairy Trade, the Institute is continuously
working to develop its R&D and HRD programmes to better serve the nation in
terms of food security, employment generation, poverty alleviation and economic
prosperity.
4 Data Analysis:
It is widely realized that agro-based industries are essential ways for the attainment of
national objectives, especially poverty alleviation and economic development in the rural
areas. However, such industries face several problems. Some of the problems could be
dealt with by the industries themselves and others require government intervention and
even the cooperation of international agencies. The major issues concerned with agro-
based industries specifically Winery, Rice milling, diary, Ayurvedic and herbal sector are
as follows
4.1 WINERY:
STRENGTHS
o Indian wine consumption has grown 25-30% annually over a 5 year period.
o Good climate for grape growing
o Urban population is increasing.
o Youth are craving an alternative to hard liquors and developing a more refined
taste.
o Wine is becoming more acceptable to women and youth.
OPPORTUNITIES
o 100 million persons will be legally allowed to drink alcohol (25 yrs. old) in the
next 5 years.
o Supermarkets are emerging to support wine distribution infrastructure.
o Domestic market with increasing disposable income.
o Growing tourism industry.
WEAKNESSES
o Wine remains an elite taste.
o Wine is difficult to store in India due to lack of cellars and refrigeration.
o Less than 50 percent of the population is legally old enough to drink (25 yrs.
old).
o 400 million persons are 18 years old or younger.
o Poor awareness of wine and infrastructure
THREATS
o The Indian constitution discourages alcohol consumption.
o Wine viewed as a “sin” by some.
o Indians still prefer whisky.
o Advertising for alcoholic beverages is banned.
o Domestic wine production is coddled by state governments.
4.2 RICE MILLING:
The analysis of the cluster has been undertaken in terms of following parameters:
1. Market
2. Technology
3. Inputs availability
4. Innovation capability
5. Human Resource /Skill
6. Business Environment
This analysis identifies the strong & weak areas as well as threats & opportunities
envisaged in the cluster as below:
STRENGTHS:
o Strong presence in International & Domestic market.
o Market support available under Levy/CMR Policy
o Most suitable climatic environment
o Low cost fabricated machines
o Technological infrastructure available
o Bulk supply of raw materials at competitive price.
o Exporters given incentives and subsidized materials.
o Local resources available
o Capability to produce world class quality
o Ability to run non standardized machines
o Workers mostly skilled for traditional technology
o Ability of Export segment to grow & meet International challenges
OPPORTUNITY:
o Tremendous exports potential
o Substantial institutional support available.
o Non-exporting units to club for common brand and export
o Potential for productivity.
o cost reduction & quality enhancement by use of appropriate technology/QMS
WEAKNESS:
o Long 6 months off season for majority of non exporting units .
o Weak Brand equity of non exporting units .
o Compulsory & controlled marketing for levy rice.
o High production /automatic plants very costly & mostly imported beyond reach of
SSI sector.
o Entrepreneurs not aware of sources of low cost imported automatic plants and
appropriate processing techniques.
o Locally fabricated plant are unstandardised & low productive.
o Controlled MSP of paddy & compulsion of levy rice supply.
o Non Exporters production cost high.
THREATS:
o Strong competition from asian countries.
o Patent exploitation of Indian Basmati by International market
o Traditional Technology, standard & non professional MS leading to high cost
may retard the industry both at domestic / International market
4.3 AYURVEDA & HERBS:
World Herbal Industry Indian Herbal Industry
oHerbal Product’s Market :USD 80
billion
oAnnual Growth Rate : 7%
oBy 2050 : market Size is expected to
reach 6 trillion
o Indian Market : Estimated as Rs. 4205
crores
o Export of Ayurvedic drugs & allied herbal
o products : Estimated as Rs. 440 crores
o Potential by 2020 : Estimated as Rs. 7000
crores
Source : EXIM Bank Report
STRENGHTS:
Ashtavaidya tradition:Ayurveda is a holistic health system which aims at bringing about
harmony in the body, and harmony of humans with nature.
o Proven Track Record: Ayurveda has been in practice for over 5000 years, and it has
evidently worked, faith in it sustains especially among the Indian population
o Authentic Ayurvedic products :It has stood the test of time, of centuries, and this
knowledge of medicine can be preventive, protective and curative.
o People are having better perception towards Ayurvedic Medicines against
Allopathic.
o Limited but Well trained medical and paramedical staff available easily and at low
cost especially in semi urban and rural areas.
BOTTLE NECKS FOR SECTOR
o Lack of documented validation of Products, quality control procedures. & process
o Batch to batch variation in product.
o Toxicity profile -not explained
o Efficacy -not scientifically proved & documented
o Quality assurance protocol -not properly designed.
o Lack of world class treatment centers.
o Lack of NABH accreditation.
o Lack of health Insurance approval.
o Limited of well trained man power.
THREAT AND CHALLENGES
o Shortage of raw materials
o Escalation in raw materials price
o Lowering of standards in the products
o Adulteration in the raw materials
o Unhealthy growth of fake massage parlors.
4.4 DAIRY & COLD CHAIN:
Based on interaction with Mr.Amol Sanap coordinator of Sanap Dairy , Makhamalabad,
Nashik following conclusions were drawn:
STRENGTHS:
o Demand profile: Absolutely optimistic.
o Margins: Quite reasonable, even on packed liquid milk
o Flexibility of product mix: Tremendous. With balancing equipment, you can keep
on adding to your product line.
o Availability of raw material: Abundant. Presently, more than 80 per cent of milk
produced is flowing into the unorganized sector, which requires proper
channelization.
o Technical manpower: Professionally-trained, technical human resource pool, built
over last 30 years.
WEAKNESSES:
o Perishability: Pasteurization has overcome this weakness partially. UHT gives
milk long life. Surely, many new processes will follow to improve milk quality and
extend its shelf life.
o Lack of control over yield: Theoretically, there is little control over milk yield.
However, increased awareness of developments like embryo transplant, artificial
insemination and properly managed animal husbandry practices, coupled with
higher income to rural milk producers should automatically lead to improvement
in milk yields.
o Logistics of procurement: Woes of bad roads and inadequate transportation
facility make milk procurement problematic. But with the overall economic
improvement in India, these problems would also get solved.
o Problematic distribution: Yes, all is not well with distribution. But then if ice
creams can be sold virtually at every nook and corner, why can’t we sell other
dairy products too?Moreover, it is only a matter of time before we see the
emergence of a cold chain linking the producer to the refrigerator at the
consumer’s home!
o Competition: With so many newcomers entering this industry, competition is
becoming tougher day by day. But then competition has to be faced as a ground
reality. The marketis large enough for many to carve out their niche
OPPORTUNITIES:
"Failure is never final, and success never ending”. Dr Kurien bears out this statement
perfectly. He entered the industry when there were only threats. He met failure head-on,
and now he clearly is an example of ‘never ending success’! If dairy entrepreneurs are
looking for opportunities in India, the following areas must be tapped:
o Growth in Milk Production: India is the highest milk producer in the world
contributing 88 million tons to the total milk production of 584.6 million tons (FAO,
Rome). India’s milk production today accounts for more than 13 percent of the total
world output and 57 percent of Asia’s total production. Milk production economy is
based on conversion of agro by-products and opportunity labor (Khanna, 1999).
Therefore the cost of milk production is low, the farm-gate price of milk in India is
one of the lowest in the world. This would increase India’s pie in the world total
milk production presenting an opportunity for increasing share in the international
market.
o Economic Growth: Demand for milk and milk products receive a boost from the
economic growth-taking place in India. As incomes rise, milk and milk products add
to the traditional diet. India has witnessed a GDP growth of 7/8 percent per annum
over the last 10 years and witnessing rapid increase.
o Growth in Population: The world population is expected to increase by 1.5 percent
per annum. Most estimates suggest that in 2025, total world population will be
between 8.1 and 8.5 billion.. India will account for 30 percent of the growth in the
population base of Asia
o Increasing Urbanization: Increasing urbanization is expected to expand the
potential market for the dairy sector. Presently, only 988 out of 3,700 cities and
towns in India are served by its milk distribution network, dispensing hygienically
packed wholesome, quality pasteurized milk.
o Changing Face of Domestic Market: Food service institutional market is growing
at double the rate of consumer market. There is an increasing consumption of food
products ‘away-from-home’.The concept of parlors is opening new vistas for ready-
to-serve dairy products, which would ride piggyback on the fast food revolution
sweeping urban India.
o Domestic Demand: India is the world’s largest consumer of liquid milk. Milk
occupies prideof place as the most coveted food in the Indian diet, after wheat and
rice. According to consumer survey conducted by the National Sample Survey
Organization (NSSO), the consumption of livestock products,particularly milk, has
gained popularity in the last two decades both in the rural and urban areas.
o Liquid Milk: Presently, the modern milk distribution network supplies hygienically
packed quality pasteurized milk to about 1,000 cities and towns. This number could
go up by almost five times in the foreseeable future
o Value Added Products: The domestic market for value added products like butter,
cheese, ice cream, dairy whiteners and spreads is galloping at 8-10 percent per year.
o Branded Ethnic Dairy Products: are witnessing rising demand and increased
acceptance,especially among urban consumers.
o Export Potential: India is a very minor player in the world market. Imports of dairy
products is occasional and in small quantities.
CHALLENGES:
o Organizing milk producers under cooperatives,
o Provision of veterinary services, feeds and fodders in a cost effective manner,
o Promoting hygienic practices of milk production,
o Increasing milk production and per capita availability,
o Producing and marketing high volumes of dairy products with low margins,
o Meeting international standards and increasing exports,
o Tackling the menace of production of artfficial milk,
o Promoting sheep, goat and camel milk, commercial production of traditional
products.
o Innovating product varieties,
o Feedback towards appropriate government policies, and
o Reducing adverse environmental impacts of dairying.
5. RECOMMENDATION
o National level plan for improvement and extension of agro-processing technology
at farm, traditional small industry and modern industry levels should be prepared.
The plan should take into account the diversity in resources and needs of different
regions in the Country. It should include programme details and implementation
schedule for the first four or five years. The progress of plan implementation
should be periodically reviewed to allow adjustments and corrective measures,
and to develop programme details for the years beyond the period under review.
o Thrust areas for research and development should be identified and medium term
research and development programme should be prepared and implemented to
support the national plan for improvement and extension of agro-processing
technology at different levels. Treatment and utilization of effluents from agro-
processing industry should be included in the R.D. programme.
o Emphasis should be put on the establishment of new agro-industrial plants in the
production catchments to minimize transport cost, make use lower cost land and
more abundant water supply, create employment opportunity in the rural sector
and utilize process waste and by-products for feed, irrigation and manure.
o Infrastructure in the production catchments selected for agro-industrial
development should be improved. Because of uncertain grid power supply to rural
areas, decentralized power generation using locally available resources may
become an integral part of agro-industrial development. Similarly, if the raw
materials and processed products are perishable or semiperishable in nature, cold
chain will have to be established.
o The national plan should provide for management of agro-industrial activities in
the catchment area, both by private companies and individuals as well as
cooperatives.
o Financial incentives and support should be provided on liberal scale to promote
the modernization of agro-processing industry and for establishing new such
industries in production catchments.
o Arrangements to supply market information to the farmer and agro-processor
should be put in place.
o Other Miscellanies Suggestions
• Promote cultivation of specific plants & crops
• Implement good agricultural practice, good pre and post harvesting practices
and good storage practices
• Promote single point sourcing of raw materials and information centres
• Promote sustainable harvesting of minor forest and rare produces
• Initiatives for high quality chain.
• Training for soft skill development for allied staff.
• Specialized institutes for developing
REFERENCES:
India Economics, Misra & Puri 27th Rev Editin, Himalaya Publication House, Mumbai.
Modern Technology of Agro Processing & Agricultural Waste Products. National
Institute of Industrial Research, New Delhi.
For a review of their working, see: N R Kothare, "Agro-industries Corporations",
Reserve Bank of India Bulletin, Vol XXXII, No 2, February 1978, p. 80.b
Report on “Economic Parameters of the Food Processing Sector” by the Ministry of
Food Processing Industry
Alagh, M,(2011), Agricultural Prices in a Changing Economy:An Empirical Study of
Indian Agriculture, Academic Foundation.
Alagh, M(2011) A Survey of the Reform Process in Agriculture In India-Where have we
reached, how far can we go, CMA, Unpublished.
Balakrishnan, P. (1991), Pricing and Inflation in India, Delhi: Oxford University Press.
Chakrobarty S and Dasgupta, Z. (2010) , The Challenges before NABARD in the Midst
of RBI’s Sterilization Policy, Economic & Political Weekly, vol xlv no 31, July 31.
Report on “Agro-Processing Industries in India—Growth, Status and Prospects” by R. P.
Kachru Asstt. Director General, Indian Council of Agricultural Research, New Delhi
A Report on “Agro Processing Industries---A Challengeing Entrepreneurship For
Rural Development” presented by Pardeep S. Shehrawat
EXIM Bank Annual Report 2010-11.
WEBLIOGRAPHY:
http://www.cftri.com/aboutus.html
http://www.icar.org.in/en/aboutus.htm
http://www.mpeda.com/inner_home.asp?pg=overview
http://www.ndri.res.in/ndri/Design/aboutNDRI.html
http://runners.ritsumei.ac.jp/cgi-bin/swets/hold-uerye?mode=1&key=S124874653202590
&idxno=31085313
