1

Ayyappan S. and M.Krishnan (2004), Indian fisheries: dimensions of development, Indian Journal of Agricultural Economics, July-September 2004, 59(3) : 391-412 (Annual Conference of Indian Society of Ag. Economics, TNAU, Coimbatore - lead paper)

FISHERIES SECTOR IN INDIA: DIMENSIONS OF DEVELOPMENT

S.AYYAPPAN AND M.KRISHNAN1 Introduction

Fisheries sector occupies a very important place in the socio-economic

development of the country. It has been recognized as a powerful income and

employment generator as it stimulates growth of a number of subsidiary industries

and is a source of cheap and nutritious food besides being a foreign exchange

earner. Most importantly, it is the source of livelihood for a large section of

economically backward population of the country. The main challenges facing

fisheries development in the country have been in assessment of fishery resources

and their potential in terms of fish production, development of sustainable

technologies for fin and shell fish culture, yield optimization, harvest and post-harvest

operations and landing and berthing facilities for fishing vessels, augmenting export

of marine products, generating employment and improving welfare of fishermen and

their socio-economic status.

India with a long coast line of 8129 Kms, two million sq. kms of Exclusive

Economic Zone and 1.2 million hectars of brackish water bodies, offers vast potential

for development of fisheries. Against an estimated fishery potential of 3.9 million

tones from marine sector, only 2.6 million tones are tapped. Fishing efforts are

largely confined to the inshore waters through artisanal, traditional, mechanised

sectors. About 90% of the present production from the marine sector is from within a

depth range of up to 50 to 70 meters and remaining 10% from depths extending up

to 200 meters. While 93% of the production is contributed by artisanal, mechanised

1 Deputy Director General (Fisheries), Indian Council of Agricultural Research, Krishi Anusandhan Bhavan, Phase II, Pusa, New – 110 012 (ayyapans@yahoo.co.uk) and Head, Technology Transfer, Evaluation and Informatics Division, Central Institute of Brackishwater Aquaculture, 75, Santhome High Road, R.A.Puram, Chennai – 600 028 (mahadevak@hotmail.com) respectively. The views expressed in this paper are those of the authors only.

2

and motorised sector, the remaining 7% is contributed by deep sea fishing fleets

confining their operation mainly to the shrimp grounds in the upper East Coast.

A working Group constituted by Ministry of Agriculture in August 1990 had

revalidated the fishery resource potential of Indian EEZ at 3.9 million tonnes of which

2.21 million tonnes are within a region of depth upto 50 meters. It is found that the

resource within 50 meters.depth regions is at present exploited to the optimum level.

The resource potential beyond 50 meters. is estimated at 1.69 million tonnes. Some

of the commercially important resources uder exploitated beyond 50 mtrs. depth

regions are tuna(2.09 lakhs tonnes), Tunnies (2.42 lakh tonnes), Ribbon fish (2.16

lakh tonnes), Perches(1.25 lakh tonnes), Cat fish (0.63 lakhs tonnes) etc (Annexure

1)

The Exports Dimension

The attention turned to seafood exports as a result of the implementation of

the New Economic Policy of Government of India in mid 1991. Seafood or marine

products exports was recognised as a source of great potential for earning foreign

exchange to help ease the adverse balance of payments position that India was

facing in those years.

Table 1 shows the pattern of agricultural exports from India. It can be noted

that of the total value of exports of Rs. 55716 crores in 2003-04, 11.7 % of the

exports value is from agricultural commodity exports. Among the agricultural

products exports, marine products contributed 18.7 % of the total value of

agricultural commodities exported. It is the single largest contributor to the

agricultural commodities exports kitty of India.

3

Table 1: Pattern of Selected Agricultural Commodities Exports from India

Items 2001-02 2002-03 2002-03 (April –

Feb.) 2003-04 (April-Feb.)

Million US $

% Share of Ag. Exp.

Million US $

% Share of Ag exports

Million US $

% Share of Ag. Exp.

Million US Dollar

% Share of Ag Exp.

Tea 360.5 6.1 343.6 5.1 320.3 5.3 317.1 4.9 Rice 665.5 11.3 1238.10 18.40 1106.00 18.20 799.70 12.30 Spices 313.90 5.30 342.80 5.10 314.20 5.20 286.40 4.40 Cashew 375.10 6.40 424.20 6.30 394.40 6.50 331.50 5.10 Oil Meals 474.50 8.0 308.80 4.60 286.40 4.70 563.10 8.70 Fruits and Vegetables

262.80 4.50 300.20 4.50 258.20 4.20 385.10 5.90

Meat and Meat Preparations

250.20 4.20 284.60 4.20 263.10 4.30 310.30 4.80

Marine Products

1236.80 21.00 1431.60 21.30 1303.60 21.50 1218.80 18.70

Agricultural exports

5901.00 6734.00 6076.00 6506.00

Total Exports

43826.70 52719.40 47136.10 55716.70

Ag. Exp. % of Total Exports

13.50 12.80 12.90 11.70

Source: DGCI&S

The index numbers of the unit values and quantum of exports of food and

food articles and fish and fish preparations indicate that the rate of growth of the

index in respect of fish and fish preparations have been outstanding (Table 2)

4

Table 2: Index numbers of the unit values and quantum of exports

(Base 1978-79=100) Commodity heads

Parameter 1990-91

1997-98

1998-99

1999-2000

2000-01

2001-02

Unit Value

226 514 451 498 524 482 Food and food articles

Quantum

138 270 334 276 304 350

Unit Value

259 679 685 700 808 703 Fish and Fish preparations Quantum

164 294 283 324 349 371

Source: Statistical Abstracts, India, 2002 The index of unit values of exports of fish and fish preparations have grown

almost twice as much as food and food articles, the index of quantum of both

remaining more or less equal indicating that Indian exports of fish and fish

preparations have doubled in unit value over time. Data of gross sales of companies

in marine foods as per Centre for Monitoring Indian Economy (CMIE) shows to have

more than doubled during the period 1993-94 to 2000 – 2001. The Herfindahl Index

of Concentration of the CMIE sample of 148 companies indicate zero concentration

implying that the seafood industry is wide open to market forces and competition

which ensures that the market for seafood is almost perfectly competitive (CMIE

data, June 2001 and August 2003).

A Brief History of Marine Products Exports

Till the close of 1960 the export of Indian marine products mainly consisted of

dried items like dried fish, dried shrimp, shark fins, fish maws etc. The frozen items

entered in the export basket in 1953 in negligible quantities. From 1961 the export of

dried marine products was on decline and exports of processed items were making

steady progress. With the devaluation of Indian currency in 1966 the frozen and

canned items registered a significant rise. These items continued to dominate the

trade. Markets for Indian products spread fast to developed countries from the

traditional buyers in developing countries.

5

Market Structure

Before 1960, the markets for Indian marine products were largely confined to

neighbouring countries like Sri Lanka, Myanmar, Singapore etc. This position

continued as long as exports from India were dominated by dried items. When the

frozen and canned items increasingly figured in our exports, the sophisticated

affluent markets like USA, France, Australia, Canada, Japan etc. became important

buyers. Processing units with modern machinery for freezing and canning came up

at important centres to process and pack for exports.

Over the years, the frozen seafood markets for Indian marine products have

witnessed changes. The USA was the principal buyer for our frozen shrimp for a long

time but after 1977, Japan emerged as the principal buyer for frozen shrimp followed

by the Western European countries. While Japan continued to be the single largest

buyer of our marine products accounting for 15.29% in volume and 30.56% in value

during 2001-02, USA accounted for 11.55% of volume and 23.86% of the value

during the same period. Share of USA is increasing steadily.

China is one of the leading markets for fish items like Ribbon fish, Crocker

etc. China accounted for 31.75% in volume and 10.03% in value of the total export of

marine products from India.

Export Trend

The export of marine products had grown to greater proportion as one of the

important item of India's exports. accounting for approximately 4 % of the total export

from India. Dried fish was the prominent item exported during the fifties and sixties

but in the seventies it gave way to frozen and canned products.

During eighties, the canned items slowly disappeared and frozen items

become the prominent one in India's seafood trade. Amongst the frozen items also,

there was changes in the demand from various countries. While Japan showed their

preference to headless shell on shrimp, the USA demanded peeled shrimp meat

while the European countries preferred the IQF shrimp in frozen and cooked form.

The European market also absorbed the major share of cephalopods while Japan

6

had taken a small share of it. Due to introduction of new deep sea fishing vessels

and modification of the existing trawlers to suit deep sea fishing, a large quantity of

fish become available for export. These frozen fish items had greater demand in the

South East Asian countries as well as in the Middle East (Annexure II)

In the seventies, the export was depending mainly on shrimp but due to the

export promotional measures, it become possible to diversify the products in eighties

adding Cephalopods (Cuttlefish, squid and octopus) and frozen fish (such as

Pomfret, Ribbon fish, Seer fish, Mackerel, Reef cod, Croakers, Snapper etc). While

all these items hold good prospects, live fish, chilled fresh water fish etc. are

promising items for the future.

Due to the introduction of scientific shrimp farming, the export of frozen value

added shrimp is continuing as the major foreign exchange earner among marine

products. Export of items like breaded and battered shrimp, double skinned

cuttlefish, fish burgers, sea food mix, squid fillets etc. have made its presence felt

and is expected to increase in leaps and bounds by the turn of the century.

The export mainly consists mostly of low valued fin fish varieties (35.83%)

followed by frozen Shrimp (33.83%), frozen Cephalopods (22.88%) and dried

seafood items (2.07%). The major change noticed in the export trend, is the

emergence of South East Asia who continued to be the top most importer of marine

products in terms of volume. The other individual markets which increased their

shares are Canada, Mauritius, Australia, Switzerland, Maldives, New Zealand,

Reunion, Panama, Venezuela, Taiwan, Bangladesh, Philippines, Turkey and Malta.

Marine Products Exports : Recent Trends

Export of marine products has increased considerably to an all time high both

in volume and value during 2002-03 with actual export of 467297 MT valued at

Rs.6881 crore or US $ 1425 million. There is an increase in the unit value realisation

also over the previous year. The increase in unit value was 3.39%. The export

details during the last 5 years is given in Table 3.

7

Table 3: Marine Products Exports 1998- 2003

Q: Quantity in MT, V: Value Rs. Crore, $: US Dollar in Million

Export Variation (%) U.V. 1998-99 Q 302934 - 82884 - 21.48 V 4626.87 - 70.61 - 01.50 152.73 $ 1106.91 - 188.95 - 14.58 3.65 1999-00 Q 340003 + 37069 + 12.24 V 5095.73 + 468.87 + 10.13 149.87 $ 1184.23 + 77.32 + 06.99 3.49 2000-01 Q 440473 +97443 +28.41 V 6443.89 +1327.22 +19.12 146.29 $ 1416.32 +227.31 +19.12 3.22 2001-02 Q 424470 -16003 -3.63 V 5957.05 -486.84 -7.56 140.36 $ 1253.35 -16297 -11.51 2.95 2002-03 Q 467297 +42827 +10.09 V 6881.31 +924.26 +15.52 147.26 $ 1424.90 +171.55 +13.69 3.05

Major Items

Frozen Shrimp continued to be the major item, contributing 66.97% in value of

the total export of marine products from India. Even though the share of shrimp

export has decreased from 30.09% of the previous year to 28.85% in quantity and

from 69.50% of the previous year to 66.97% in terms of value it recorded a growth of

5.56%, 11.31% and 9.46% in terms of volume, rupee realisation and in US $ terms

during 2002-03. The unit value of shrimp also increased to US $ 7.07 per kg from US

$ 6.82 per kg realised during the previous year i.e. an increase of 3.67%.

The share of frozen fish during 2002-03 was 42.01% in volume compared to 41.22%

in 2001-02 and 12.23% in value compared to 11.97% in 2001-02. There has been an

increase in the export of frozen fish by 12.20% in quantity and 18.03% in rupee value

respectively over the previous year. There was marginal increase in the unit value

realization. The unit value realised was US $ 0.89 per kg from US $ 0.86 of the last

year registering a growth of 3.49%. Frozen ribbonfish, frozen pomfret, frozen tuna

(Skipjack, Yellow Fin), fish loins and steaks contributed considerably in increasing

the export of Frozen Fish. This year, export of Cephalopods especially Cuttlefish

showed a growth, which was to the tune of 35.37% in quantity and 48.92% in value.

8

The export of frozen. squid also registered a growth of 16.59% in value terms over

the previous year. However, there was a shortfall of 4.91% in volume. Live items like

live whelk (Baigai), live fish and live crab showed an increase in exports whereas the

export of live lobster, live aquarium fish and live snail recorded a shortfall during the

year. Export of chilled items has accorded a decline both in volume and value during

this year. Details of item-wise export during the last two years are available in Table

4.

Table 4: Item Wise Exports of Marine Products

Q: QUANTIY IN MT, V: IN RS. CRORE, $: US$ IN MILLION, UV$: UNIT VALUE IN US$/KG

ITEMS % Share to Total APR-MAR2002-03

APR-MAR2001-02

VARIATION (%)

Frozen Shrimp 28.85 66.97 66.91

Q V $

UV$

1348154608.31953.44

7.07

1277094139.92871.03

6.82

7106 468.39

82.41 0.25

5.5611.31

9.463.67

Frozen Fin Fish 42.10 12.23 12.26

Q V $

UV$

196322841.65174.63

0.89

174976713.11150.04

0.86

21346 128.54

24.59 0.03

12.2018.0316.39

3.49 Frozen Cuttle Fish 8.85

6.06 6.06

Q V $

UV$

41381417.09

86.092.09

30568280.07

58.931.93

10813 137.02

27.44 0.16

35.3748.9246.56

8.29 Frozen Squid 8.10

5.59 5.60

Q V $

UV$

37838384.37

79.832.11

39790329.67

69.361.74

-1952 54.70 10.47

0.37

-4.9116.5915.1021.26

Dried items 1.75 1.22 1.23

Q V $

UV$

817884.2317.46

2.13

* 830767.9614.30

1.72

-129 16.27

3.16 0.41

-1.5523.9422.1023.84

Live items 0.45 0.78 0.78

Q V $

UV$

211553.6611.12

5.26

162840.57

8.545.24

487 13.09

2.58 0.02

29.9132.2730.21

0.38 Chilled items 0.72

0.86 0.86

Q V $ UV$

3350.0059.1412.27

3.66

3284.0063.6613.39

4.08

66 -4.52 -1.12 -0.42

2.01 -7.10 -8.36 -10.29

Others 9.27 6.29 6.30

Q V $ UV$

43298.00432.86

89.782.07

* 38208 322.09

67.761.77

5090 110.77

22.02 0.30

13.3234.3932.5016.95

TOTAL 100.00 100.00 100.00

Q V $ UV$

467297.006881.311424.90

3.05

424470 5957.051253.35

2.95

42827 924.26 171.55

0.10

10.0915.5213.693.39

(*) Salted Jellyfish is included under Dried Items.

9

Major Markets

USA emerged as the single largest market for Indian marine products during

2002-03 relegating Japan to the second position. The share of USA was 13.21% in

quantity, 29.81% in value by registering an export growth of 25.82% and 44.30% in

volume and value respectively. The share of Japan was 11.75% in volume and

22.30% in value. There was a shortfall in the export to Japan to the tune of 15.39%

and 15.70% in quantity and value terms respectively.

In spite of the antibiotics problems in the EU, the export to EU countries registered a

growth of 14.50% and 21.21% in volume and value when compared to the year

2001-02. The member countries of European Union together accounted for 20.23%

and 20.18% in the total quantity and value of Indian marine products exported. In

terms of quantity, China occupied the first position contributing 36.55% of the total

exports from India. However, China’s share in value was only 11.08%. This was

mainly due to the export of low valued items, especially finfish varieties like frozen

ribbonfish, frozen croaker, etc. There was also a remarkable increase in exports to

China in terms of quantity (by 26.75%) and value by 27.67%. The export to South

East Asia has also increased by 19.24% in value with a shortfall of 15.88% in volume

compared to last year. The export to Middle East market has increased 2.66% in

quantity, 13.08% in value and 11.29% in dollar terms. Exports to other markets like

Australia, Tunisia, South Africa, Lithuania, Mexico, Dominican Republic, Poland,

Puertorico, Ukraine, etc. showed a positive growth in volume, value and foreign

exchange realization terms. Other markets like Sri Lanka, Canada, Mauritius, etc.

had a growth in terms of value but declined in volume terms (Table 5).

Prospects of Fisheries growth:

With the fisheries sector comprising of marine fisheries, freshwater and

brackishwater aquaculture and inland fisheries consisting of tanks and reservoirs,

the potentiality of the sector as a whole remains to be fully tapped. It remains a

sector of much promise.

Fisheries sector in particular is more complex enterprise that functions under

integrated network of natural resources, other enterprises with forward and backward

linkages with fisheries and other socio-political variables. Major functions of fisheries

10

enterprises viz. production, transportation and processing involves value addition

from labour, capital and management which significantly influences the rapid

economic development of the country. Unlike agriculture, contribution of fisheries

sector to GDP continues to grow at a rapid pace because of expansion of culture

fisheries enterprises.

Table 5: Country Wise Export of Marine Products Q:Quantity in M T, V: Value in Rs. Crore, $: US Dollar Million

COUNTRY % share APR-MAR APR-MAR VARIATION %

to Total 2002-03 2001-02 JAPAN 11.75 Q 54916 64905 -9989 -15.39 22.30 V 1534.76 1820.69 -285.93 -15.70 22.26 $ 317.17 383.07 -65.90 -17.20 USA 13.21 Q 61703 49041 12662 25.82 29.81 V 2051.12 1421.38 629.74 44.30 29.79 $ 424.51 299.05 125.46 41.95 European Union

20.23 Q 94541

* 82572 11969 14.50

20.18 V 1388.47 1145.49 242.98 21.21 20.20 $ 287.84 241.01 46.83 19.43 CHINA 36.55 Q 170811 134767 36044 26.75 11.08 V 762.48 597.23 165.25 27.67 11.10 $ 158.23 125.66 32.57 25.92 South East Asia

9.44 Q 44097 52424 -8327 -15.88

9.33 V 642.38 538.75 103.63 19.24 9.35 $ 133.15 113.35 19.80 17.47 Middle East 4.21 Q 19668 19159 509 2.66 2.98 V 204.74 181.06 23.68 13.08 2.98 $ 42.40 38.1 4.30 11.29

OTHERS 4.61

Q 21561 * 21602 -41 -0.19

4.32 V 297.36 252.45 44.91 17.79 4.32 $ 61.60 53.11 8.49 15.99 TOTAL 100.00 Q 467297 424470 42827 10.09 100.00 V 6881.31 5957.05 924.26 15.52 100.00 $ 1424.90 1253.35 171.55 13.69

* Norway and Switzerland are excluded from EU and included in Others

11

Performance of the fisheries sector has been quite consistent. Fish production

was 0.75 million tonnes in 1950-51. It rose to 2.34 million tonnes during 1979-80 and

then to 3.68 million and 5.26 million tonnes in 1989-90 and 1998-99 respectively. In

terms of growth, production rose by 4.78 per cent in 1979-80 to 1989-90 and by 4.70

during 1989-90 to 1998-99 (Table 6)

Table 6: Production and Growth Rates of Some Major Agricultural Commodities

Production (Million tonnes) Growth rates (% per annum)

1979 to 1989-90 1989-90 to1998-99 Commodity

1949-50

1979-80

1989-90

1998-99

Area Prod Yield Area Prod. Yield Rice 23.54 42.33 73.57 85.99 0.45 4.29 3.82 0.49 1.70 1.21 Wheat 6.39 31.83 49.85 70.78 0.57 4.24 3.65 1.64 3.64 1.96 Foodgrains 54.92 109.70 171.04 203.04 (-) 0.11 3.54 3.33 (-)

0.18 1.80 1.42

Fish 0.75 2.34 3.68 5.26 4.78 4.70 Source: Planning Commission (2002) p. 55 (abridged) Changes in output values and performance:

The performance of the fisheries sector has been commendable relative to

that of agriculture and livestock .The performance of fisheries between 1995-96 and

2000-01 has been significantly attractive. Analysis of data on gross output values of

agriculture, livestock and fisheries revealed that percentage of positive change in

output values with respect to time has risen by 28 per cent in fisheries with inland

fisheries contributing more than 40 percent of the growth (Table 7).

Table 7: Matrix of change in output values in agriculture, livestock and fisheries (1993-94 = 100)

Sectors 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-01

Agriculture 103.60 113.65 110.19 118.68 119.43 116.38 Livestock 107.56 111.34 114.47 119.27 122.85 127.09 Fisheries 110.90 119.71 121.37 117.65 125.58 127.78

Inland Fisheries 112.25 117.77 120.75 128.20 139.70 140.78 Marine Fisheries 109.60 121.58 121.96 107.52 112.02 115.30

Data Source: National Accounts Statistics, CSO (Data for 1994-95 – NA)

12

Requirements, growth and projections Given the objectives of removal of incidence of poverty and unemployment

and of ensuring food and nutritional security, attaining a high growth rate in

agriculture in the Tenth Plan and beyond is necessary. The targeted annual growth

rates in the value of agricultural output for the Tenth and Eleventh Plans are 5.3

percent and 5.1 per cent respectively. The commodity wise break up of the target

growth rates is given in Table 7.

Table 7: Target growth rate in value of output of agriculture during the Tenth

Plan and XI Plan ( Per cent)

Sr. No Commodity X Plan XI Plan 1. Agricultural crop 4.54 4.27

a) Foodgrain 3.57 2.73 i) Rice 3.08 2.73 ii) Wheat 4.31 3.64 iii) Coarse

cereal 2.40 2.43

iv) Pulses 4.93 5.66 b) Oilseeds 8.85 5.16 c) Sugar Cane 6.16 6.07 d) Fruits & Vegetables 8.01 7.89 e) Other agricultural

products of which 3.08 3.04

i) Tea 6.16 6.07 ii) Coffee 6.16 6.07

2. Livestock 7.68 7.36 a) Milk

Group 8.32 7.89

b) Meat & Poultry group

8.63 8.50

c) Other livestock products

1.85 1.82

3. Fishery 7.00 7.00 4. Total agriculture 5.30 5.10 Note: The growth rates differ from the growth rates of the quantum of output on account of expected changes in relative prices. Source: Planning Commission (1999)

The targeted rate of growth of value of output of the fishery sector has been

pegged at 7 per cent in both the X and the XI plans, comparable to the targets for the

13

livestock sector indicating the growing confidence of the country in the fisheries

sector.

But, during the Ninth Plan period, Rs. 800 crore had been earmarked for the

fisheries sector. Against the outlay of Rs. 119.15 crore for 1997-98 and Rs. 159.90

crores for 1998-99, expenditures was only Rs. 85.06 crore (71.4 per cent) and Rs.

91.42 crore (57.2 per cent) respectively (Planning Commission, 2002).

The state wise projected outlay for the fisheries sector in the Tenth Five Year

Plan 2002 – 2007 is given in Table 8. Andhra Pradesh has made more than 50 per

cent of its outlay on agriculture to fisheries. West Bengal (20%) and Kerala (16 %)

are the only other two states that have more than 15-20 per cent of their outlay on

agriculture directed towards fisheries. The projected outlays do not seem to have

been made based on the inherent potential of at least the maritime states and

reallocation of outlays in tune with the requirement and potential of the sector can be

hoped for.

14

Table 8: Projected Outlay for Fisheries Sector – States / UT’s (2002-2007) (Rs. Lakhs) X Five Year Plan

States / UT’s Agriculture and allied activities

Fisheries Fisheries %of Agriculture & a/a

Andhra Pradesh

2333.21 1270.00 54.43

Arunachal Pradesh

51531.00 2394.00 4.65

Assam 66498.00 6829.00 10.27 Bihar 53611.00 1895.00 3.53 Chattisgarh 86097.00 1884.00 2.19 Goa 15834.00 780.00 4.93 Gujarat 354871.00 6639.00 1.87 Haryana 46953.00 3720.00 7.92 Himachal Pradesh

120169.00 1554.00 1.29

Jammu & Kashmir

150780.00 4537.00 3.01

Jahrkhand 82485.00 2075.00 2.52 Karnataka 234694.00 6765.00 2.88 Kerala 112500.00 17500.00 15.56 Madhya Pradesh

158152.00 2989.00 1.89

Maharashtra 424862.00 7020.00 1.65 Manipur 11386.00 1375.00 12.08 Meghalaya 29960.00 700.00 2.34 Mizoram 16198.00 607.00 3.75 Nagaland 25550.00 950.00 3.72 Orissa 116520.00 3445.00 2.96 Punjab 63541.00 694.00 1.09 Rajasthan 164948.00 302.00 0.18

Sikkim 17499.00 200.00 1.14 Tamil Nadu 393205.00 20400.00 5.19 Tripura 45000.00 2603.00 5.78 Uttar Pradesh 514240.00 5000.00 0.97 Uttaranchal 69492.00 367.00 0.53 West Bengal 91463.00 17560.00 19.20 Total States 675195.00 22927.00 3.40 A&N Islands 177777.00 2725.00 1.53 Chandigarh 2032.50 100.00 4.92 D&N Haveli 2783.50 0.00 0.00 Daman & Diu 923.45 223.00 24.15 Delhi 13745.00 50.00 0.36 Lakshadweep 10683.60 5989.26 56.06 Pondicherry 19580.00 1280.00 6.54 Total (UT’s) 67525.05 10367.26 15.35 Total States & UT’s

3818885.05 132421.26 3.47

% to total outlay

6.46 0.22

Source: Planning Commission (2002)

15

Table 9 gives the projected production and per capita consumption of

selected agricultural commodities. The figures have been worked out on the basis of

the expected population growth rate in per-capita consumption expenditure and the

elasticity of demand with respect to per capita consumption expenditure.

Table 9: Projected production and per capita consumption of selected agricultural commodities

Commodity Production 1996-97 (mil. Ton)

Consumption 1996-97 (Kgs.)

Production 2011 – 12 ( Mil. Ton)

Consumption 2011-12 (Kgs.)

1) Agricultural Crop

a) Foodgrain 199.32 188.50 337.3 223.35 i) Rice 81.31 84.00 128.16 93.80 ii) Wheat 69.27 63.00 130.45 81.25 iii) Coarse cereals

34.27 27.50 48.93 27.50

iv) Pulses 14.46 14.00 29.76 20.80 b) Oilseeds 24.96 7.00* 58.56 11.05* c) Sugar Cane 277.25 27.00** 679.64 45.48** 2) Livestock a) Milk 68.60 70.25 227.50 152.15 3) Fishery 5.35 5.05 14.76 9.30 * Consumption of oilseeds is in terms of edible oil ** Consumption of sugarcane is in terms of sugar and jaggery Source: Planning Commission, 1999

Food grain consumption is likely to increase from 188.50 Kgs / per capita in

1996-97 to 223.35 Kgs/ per capita in 2011-12. In order to meet this demand, the

production of foodgrain is projected to increase from 199.32 million tonnes in 1996-

97 to 337.3 million tonnes in 2011-12. Fish consumption is likely to rise from 5.05

Kgs./ per capita in 1996-97 to 9.30 Kgs./ per capita in 2011-12. (Planning

Commission, 1999).

Role of NABARD and institutional Finance:

India’s rural credit system is unique in its reach and diversity. The thrust of

National Bank’s (NABARD) rural development programmes has been to make a

frontal attack on poverty through their credit and development functions. NABARD’s

refinance to credit institutions rose from 703 crore 1n 1982-83 to Rs. 6683 crore in

16

2001-02. Table 10 gives the disbursement of refinance to the fisheries sector

including aquaculture.

Table 10: NABARD Refinance to Fisheries and Aquaculture (Rs. Crores)

Year Refinance to agriculture Refinance to Fisheries / Aq.

1990-91 21.00 1991-92 31.00 1992-93 31.00 1993-94 55.00 1994-95 100.00 1995-96 107.40 1996-97 40.59 1997-98 32.58 1998-99 3837 29.69 1999-2000 4351 26.84 2000-01 5104 34.25 2001-02 3837 36.50 2002-03 6146 34.73

Source: O/O. General Manager (Fisheries), NABARD, Chennai -34 Refinance to the fisheries sector needs to play a greater role In financing the

fisheries sector. But a portion of the non- farm sector refinance is also a part of the

overall assistance to the fisheries sector. The figures in Table 10 does not reflect this

information. Moreover the ground level credit (GLC) reflects the actual credit made

available to the fisheries sector (Table 6).

Table 11: Ground Level Credit and Refinance Disbursed to the Fisheries Sector (Rs. Cr.) Type Years 1997-98 1998-99 1999-2000 Ground Level credit (GLC) 338.00 443.00 508.00 Refinance Disbursed 32.58 29.69 26.84 Per cent of GLC 9.64 6.70 5.28 Source: O/O. General Manager (Fisheries), NABARD, Chennai –34 The refinance component of the GLC to the fisheries sector has been

declining in the recent years. The GLC, which reflects the actual funds made

available to the sector both in terms of refinance through the NABARD and through

commercial banks has been increasing. The NABARD is taking a positive and

proactive role in financing the fisheries and aquaculture by way of co-financing with

commercial banks and also extending direct credit to entrepreneurs.

17

Long Term Management Targets: Deep Sea Fishing

In 1986 Government of India revised its Deep Sea Fishing Policy giving more

stress to joint ventures in deep sea fishing. In 1991 Government of India further

modified the deep fishing policy encouraging long lease of fishing vessels and

permitting test fishing as prelude to joint venture. Subsequent to the recent economic

liberalisation conditions for foreign equity permitted in the case of a deep sea fishing

policy are as

• New or second hand vessels can be acquired on lease.

• The vessels should be for non-shrimp resource.

• Deep sea fishing project can be registered under 100% EOU scheme.

• Test fishing may be done to establish techno-economic viability.

• Foreign collaboration involving foreign equity upto 51% is generally permitted.

Foreign equity once invested is considered on par with Indian share holding.

• Foreign equity can be by way of fishing vessels also.

• Services of foreign crew can be availed.

• Mid sea bunkering is permitted .

Considering the importance of deep sea fishing sector in marine products

export, the Marine Products Exports development Authority (MPEDA) has initiated a

number of steps for increasing the fleet strength for exploitation of under exploited

resource and for encouraging the existing outrigger trawlers to modify for diversified

fishing.

Aquaculture

To augment production through aquaculture and to sustain and increase the

exports, the government of India promotes

• Micro and macro level survey to identify suitable sites for farming

• Preparation of site specific project reports

• Technical advice on various aspects of farming.

• Training farmers/entrepreneurs in farming

• Arrange visit of farmers from one state to other state for learning different

aspects of farming.

18

• Conduct workshop/seminar/symposium/farmers meets for the benefit of

farmers/entrepreneurs.

• Promote ecofriendly aquaculture

Controls / Enforcements being practiced for sustainable management of resources, food safety etc.

Regulatory Tools

Constituted under Section 3 (3) of the Environment (Protection) Act, 1986, the

Aquaculture Authority is mandated to protect the ecologically fragile coastal areas,

sea shore, water front and other areas through regulation of shrimp culture in coastal

States and Union Territories of India. The Authority promotes development of

sustainable and responsible shrimp farming practices within and outside the Coastal

Regulation Zone.

Functions of the Aquaculture Authority

The functions of the Aquaculture Authority are enshrined in the Notification of S O

88 (E) dated 6 Februrary 1997 and subsequently amended vide notification S O 421

(E) dated 20 May 1997 of the Ministry of Environment and Forests. The functions of

the Authority are as follows:

I. To exercise the powers under section 5 of the Environment (Protection) Act, 1986 for issuing directions and for taking measures with respect to matters referred to in clauses (v), (vi), (vii), (viii), (ix) and (xiii) of subsection (2) of Section 3 of the said Act.

II. To ensure that no shrimp culture pond can be constructed (or) set up within Coastal Regulation Zone and up to 1 000 m of Chilka lake and Pulicat Lake (including bird sanctuaries namely Yadurapattu and Nelapattu).

III. To ensure and give approval to the farmers who are operating traditional and improved traditional systems of aquaculture for adopting improved technology for increased production

IV. To ensure that the agricultural lands, salt pan lands, mangroves, wet lands, forest lands, land for village common purposes and the land meant for public purposes shall not be used (or) converted for construction of shrimp culture ponds.

V. To implement the “Precautionary Principle” and the “Polluter Pays Principle” in coastal shrimp aquaculture activities by adopting the procedure described in

19

the Supreme Court Order dated 11 December 1996 passed in Writ Petition (Civil) No 561 of 1994.

VI. To regulate and give the necessary approvals/ authorisation for shrimp activities outside Coastal Regulation Zone areas and 1000 m from the Pulicat lake and Chilka lake.

VII. To frame scheme/schemes in consultation with expert bodies like National Environmental Engineering Research Institute, Central Pollution Control Board, respective State Pollution Control Board for reverting the damages caused to the ecology and environment by pollution in coastal States/ Union Territories.

VIII. To ensure the payment of compensation to the workmen employed in the shrimp culture industries as per the procedure laid down in the Supreme Court Order dated 11 December 1996 passed in Writ Petition (Civil) No 561 of 1994.

IX. To comply with the relevant orders issued by the concerned High Courts and Supreme Court from time to time.

X. To deal with any other relevant environment issues pertaining to coastal areas with respect to shrimp culture farming, including those which may be referred to it by the Central Government in the Ministry of Environment and Forests.

For discharging the above functions, the Aquaculture Authority has constituted

State Level Committees (SLCs) and District Level Committees (DLCs) under the

chairpersonship of Secretary-in-Charge of Fisheries and the District Collector/

Deputy Commissioner respectively. The applications submitted by the shrimp

farmers are received by the DLCs and after scrutiny and verification of the

information and field level inspections, wherever necessary, are forwarded to the

SLCs for consideration. The applications after recommendation of the SLC are

forwarded to the Aquaculture Authority for consideration for issue of approvals.

Quality Control and Food Safety

Quality & Food Safety is the foundation of any food processing industry. In the

sea food industry, quality control is a very vital element as quality of the products

processed is highly heterogeneous and perishable in nature, particularly under

tropical conditions. Realizing this, the industry has adopted modern methods of

handling, processing besides adequate quality control measures to improve the

quality of sea food.

20

To cope up with the increasing demand for safe food and to satisfy the needs

of health / quality conscious consumers of the global seafood market, the

government has identified the following thrust areas for development / improvement

and implement programmes as under:

i) Product development for export: Research and development of new products Training in new technology and inviting overseas technical experts to India

ii) Quality improvement

Imparting training to technologists of Indian seafood industry in quality control in overseas labs

Entrusting special research projects on quality problems with National Research Institutes

Monitoring of seafood quality in landing and pre-processing centers.

Integrated development programme for upgrading seafood quality by providing infrastructural facilities like pre-processing centers and setting up of mini lab towards quality assurance.

Evolving standards for compliance for export of fish and fishery products to

various developed countries based on standards / norms / regulations

prescribed by such countries.

Salient features of some of the standards now being implemented in India are

given below:

Consequent to the promulgation of US Seafood Regulation on HACCP on

18th December 1995, it has become mandatory that every processor and importer

has to comply with HACCP with effect from 18.12.1997. Government of India

constituted HACCP Cell in early 1996 to assist the Indian seafood industry for the

effective implementation of HACCP. The major activities of the HACCP Cell are :

• Organizing training programmes in HACCP basic principles, audit etc. for

the benefit of technical personnel in the seafood industry and related

departments. So far, 32 such programmes were organized for the benefit

of over 900 technical personnel.

21

• Assisting the seafood establishments in the preparation of HACCP

manual, certification of such manuals, certification of HACCP compliance

etc. So far, 26 processing establishments in India are issued with HACCP

compliance certificate by MPEDA.

• Inviting Consultants from US FDA, NMFS, FAO / INFOFISH etc. from time

to time which facilitates in updating knowledge on HACCP and strengthen

the technical base of MPEDA and the industry.

Besides, ICAR fisheries institutes and the MPEDA lab at Cochin has facilities

to test seafood samples for heavy metals, pesticides and antibiotic residues using

advanced technology. These institutions also serve as a member in the Export

Inspection Council of India, Bureau of Indian Standards and National Committee of

Codex Alimentarius.

Value Addition and Quality Control

Modernisation of Processing Facilities

Several importing countries are stipulating stringent quality control for marine

products. Introduction of the concept of HACCP by USFDA, ISO 9000 and European

Community directive (EC 91/493) demand very high hygienic standards in the

production and processing facilities. Modernisation of processing facilities to meet

international standards is of primary importance for the industry in the coming years.

22

Table 12: State-wise summary of the list of approved Units to EU (2002) Maritime State PP ZV Total Gujarat 14 0 14 Maharashtra 15 0 15 Karnataka 5 0 5 Kerala 52 0 52 Tamil Nadu 19 0 19 Andhra Pradesh 24 5 29 Orissa 4 0 4 West Bengal 5 0 5 Total 138 5 143 PP Processing Plant ZV Freezer Vessel

The seafood industry in India is currently in a transitional stage from the

traditional block freezing on the production of Individually Quick Frozen (IQF) and

other value added frozen items for export to the major overseas markets.

Market Service and Market Promotion

With this aim and objective, the Government of India through the MPEDA has

drawn up various market promotion programmes for projecting our resource

potential, product diversification, quality assurance and liberal incentives for

investments and joint ventures. These include:

1. Overseas market survey 2. Data collection and maintenance of Data Bank 3. Assistance for market development 4. Publicity through media and production of literature and films on trade

promotion. 5. Sponsoring of sales team / delegations. Invitation of overseas experts for

export promotion visit to India. 6. Organising buyer-seller meets in overseas markets 7. Participation in overseas Trade Fairs and Exhibition 8. Exhibition & Trade Fairs within India.

23

Quality Control

MPEDA ensures the highest standards for seafood's exported from India. It

works in close association with Export Inspection Council of India and the Fisheries

Institutes of the ICAR and other Indian and International quality control

organizations.

Assistance is given to registered processors to set up quality control

laboratories and modern pre-processing plants throughout the country to meet the

ISO 9000 quality standards. The HACCP cell in MPEDA offers advise on matters

connected with EC Directives (Annexure III).

Conclusions

The Union Budget 2004 speaks of water bodies restoration and enhancement

of agricultural credit through specific programs aimed at agricultural development. A

concerted effort to understand fisheries and its nuances to make the best of the

comparative advantage that we have in this sector would go a long way to assimilate

the blue revolution in its entirety. Not only in respect of exports but the scope of he

fisheries sector as a provider of employment and income is to be realized in full

measure. Non governmental agencies like the Dr. M.S.Swaminathan Foundation, the

Aquaculture Foundation of India, and the inter-governmental body, the Bay of Bengal

Program have been in the forefront to exploit the scope of fisheries as a provider of

income and employment. Sufficient attention need to given to sustainability of

aquaculture operations by adoption of proper management practices. The scope of

diversification of enterprises within the gamut of aquaculture operations is available

in the literature generated by fisheries research institutes and fisheries colleges

located in the country. This literature needs to be studied and intensive efforts made

to suggest economically viable and socially accepted technologies developed, reach

the masses. The role of the fisheries sector need to be highlighted in order to build

awareness among the population to enhance increased participation and create

social cohesiveness for the development of the sector.

24

Agricultural economics research has not paid sufficient attention to the

fisheries and aquaculture component that is an integral part of its whole. Dynamics

of fisheries and aquaculture economics research demand that in order to get the

best out of the policy efforts of the government, the output from this group need to

enhanced quantitatively and qualitatively.

25

Annexure I Estimated group wise fishery potential of the Indian EEZ

Quantities are in' 000 Tonnes

Groups Upto 50 m Beyond 50 m TotalElasmobranchs 65 103 168Eels 7 - 7Cat Fish 60 63 123Oil Sardine 191 - 191Other Sardines 96 - 96Anchovies 53 - 53Other Clupeids 196 14 210Bombay Duck 104 - 104Lizard Fish 27 21 48Perches 114 125 239Sciaenids 120 22 142Ribbon Fish 95 216 311Carangids 143 304 447Silverbellies 82 4 86Pomfrets 42 12 54Mackerel 162 62 224Seer Fish 42 - 42Tunnies 37 242 279Flat Fish 38 - 38Penaeid Prawns 178 - 178Non-Penaeid Prawns 54 - 54Cephalopods 50 21 71Priacanthus Sp. - 55 55Black Ruff - 9 9Indian drift fish - 7 7Deep Sea Prawns - 3 3Deep Sea Lobster - 5 5Oceanic Tunas - 209 209Bill Fishes - 4 4Others 254 189 443

Total 2210 1690 3900

26

Annexure II

(EXIM POLICY 2002-07)

1. Items permitted (EXIM POLICY 2002-2007)

(i) No Quantitative restrictions on export.

(ii) Licence under EXIM policy not required for import of 125 species/groups of fish, crustaceans, molluscus and other aquatic invertiberates covered under FREE policy in Chapter 3 of ITC (HS) classification of Export &Import items under the EXIM policy.

(iii) Import of five groups of live fish permitted under Restricted Policy (EXIM Code 0301)

(iv) Import of Whale Shark (Rhincodon types) and parts and products of the species is restricted.

2. Promotional measures

(i) Central assistance to States for development of critical infrastructure for export such as roads, inland container depots, container freight stations, Export Promotion Industrial Parks and for equity participation in infrastructure projects.

(ii) Encouragements to State Governments for setting up Export Zones.

(iii) Declaration of Towns of Export Excellence to encourage setting up of critical infrastructure for export production, encourage common service providers and facilitate availability of better technological services and integrate benefits under the other schemes of EXIM Policy for the units in such towns.

(iv) Market Access Initiative Schemes for encouraging increased marketing efforts by exporters/Brand promotion

(v) Schemes to promote the Concept of Total Quality Management.

3. Import for export production

(i) Advance license for duty free import of inputs for export production.

(ii) Duty free import of raw material for jobbing for export/re export.

(iii) Manufacturer exporters, merchant exporters tied to supporting manufacturers and service providers eligible for import of capital goods at

27

5% Customs duty linked to fulfilment of export obligation in 8 to12 years under EPCG Scheme.

4. EOU/EPZ/SEZ

(i) Scheme of 100% EOU/Export Processing Zone/Special Economic Zone for export production continues. No trading units permitted under the scheme.

28

ANNEXURE III : AQUACULTURE SECTION-SUBSIDY ASSISTANCE SCHEMES (as on 01.09.02) GIVEN BY MPEDA

Sl No Name of Scheme Objectives Quantum of Subsidy

1 Subsidy for new farm development

For development of new prawn / shrimp farms

@25% of the capital cost, subject to a maximum of Rs.30,000/- per ha. water area, restricted to Rs.1.5 lakh per beneficiary.

2 Subsidy for small-scale hatcheries

For setting up of shrimp hatchery with a minimum production capacity of 10 million seeds per annum

@ 15% of the capital cost or Rs.1.50 lakh for private hatcheries, 25% or Rs.2.50 lakh to co-operative sector and 50% of Rs.5.00 lakh to Govt. sector.

3 Subsidy for medium- scale hatcheries

For setting up of shrimp hatchery with a minimum production capacity of 30 million seeds per annum

@ 25% of the capital cost, subject to Rs.5.00 lakh per beneficiary / hatchery (about 7 districts are excluded, being overcrowded already)

4 Subsidy for setting up of PCR labs in hatcheries

To establish PCR labs in hatcheries

@ 50% of capital cost, subject to a maximum of Rs.5 lakh per beneficiary /hatchery.

5 Subsidy for effluent treatment system(ETS) in Shrimp Farms.

To set up effluent treatment systems attached to shrimp farms

@ 25% of the capital cost, subject to Rs.1.50 lakh for shrimp farms with a minimum water area of 5.00 ha and upto Rs.6.00 lakh per beneficiary

6

Subsidy for establishment of chill room facilities in shrimp / prawn farming areas

To set up facilities for post harvest care of farm raised shrimp/prawn.

@25% of the cost of establishment of chill room, subject to a maximum of Rs.3.00 lakh per beneficiary / farmer.

7

Subsidy for purchase of water testing kits / equipment for shrimp / prawn farms

To encourage & support the farmers to use water testing kits / equipment in their farms

@ 25% of the cost of water testing kits / equipment purchased for use in the farm, subject to a maximum of Rs.30,000/- per beneficiary / farmer.

29

References:

1. Centre for Monitoring Indian Economy (2001), Company Finance Marine Foods, Financial Aggregates & Ratios, CMIE, June, p.37

2. Centre for Monitoring Indian Economy (2003), Marine Products, Industr:

Market size & shares, Centre for Monitoring Indian Economy, August, p.37

3. Planning Commission (1999), Ninth Five Year Plan, 1997-2002, Vol 1, Development goals, strategy & policies, Govt. of India, New Delhi.

4. Planning Commission (2002), Tenth Five Year Plan, 2002-2007, Vol II,

Planning Commission, Govt. of India, New Delhi.

5. Planning Commission (2002), Tenth Five Year Plan, 2002-2007, Vol III, Planning Commission, Govt. of India, New Delhi.

6. www.fao.org

7. www.aquaculture.tn.nic.in

8. www.mpeda.com

9. www.thehindubusinessline.com

10. www.indiaimage.nic.in

11. www.dahd.nic.in/stat.htm

12. www.indiabudget.nic.in/es2003-04/tables.htm

13. www.agricoop.nic.in/stats.htm

14. www.enaca.org