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Procurement of crops, offering infrastructure advantages and facilitating international interest through investment are among measures initiated by the authorities to enable welfare in the agricultural sector.
In keeping with its policy of assisting India’s farmers the government of prime minister Narendra Modi is pulling out all the stops to reassure the agricultural sector that it has its best interests at heart.
The procurement of kharif paddy, at a minimum support price, has increased nearly 15 per cent to 669.59 lakh tonnes so far in the current kharif marketing season, costing over Rs 1.26 lakh crore, even while the farmers protest against the three new farm laws passed by the authorities. In doing so, the government has 669.59 lakh tonnes of paddy till March 3, up 14.78 per cent from 583.34 lakh tonnes in the corresponding period of the previous year. At least 97.70 lakh farmers have benefited from the government’s supportive actions.
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As an added measure the union agriculture minister Narendra Singh Tomar came out with reassuring assertions that should encourage the private sector to renew investments in the farming sector. Tomar urged entrepreneurs to work towards setting up of food processing units while addressing a summit on 'Agriculture and Food Processing Opportunities in Madhya Pradesh' organised by the Ministry of Food Processing, in partnership with ASSOCHAM and Invest India.
Tomar extended a helping hand by assuring entrepreneurs of government support mainly through the passing of speedy approvals. According to an official statement, "The Union minister also stressed on the need to bring private investment and latest technology in the field of farming.”
There is ample reflection here of the government’s efforts to increase the earnings of the small farmers. The empowerment of farmers is a crucial element in the government’s drive towards ensuring their welfare given that a staggering 86 per cent of farmers in the country are small farmers. Self- sufficiency of villages coupled with growth in the agricultural sector was the overall aim. Enabling the farmers would facilitate this goal.
This enfranchisement of the farming community would go on to ensure the wellbeing of small and medium farmers who could also cultivate expensive crops benefiting from agri-tech thanks to investments made in infrastructure by the authorities which comes under the umbrella of the Atma Nirbhar Bharat Package. Crucial benefits like warehousing and cold storage would help towards preservation of crops ensure that the farmers are able to sell produce that is still fresh in the market. The organization of 10,000 new farmer producer organisations (FPOs) in the country – on an earmarked budget of Rs 6,865 crore – is demonstrated fact of the government’s positive intentions. This entitles the farmers to receive the advantages of reduced costs, better market and integrated irrigation facility by joining FPOs who, in turn, are to receive a three per cent rebate in interest for loans.
The agricultural sector, one of the main drivers of the Indian economy, is set to benefit from overseas investment. India is already the focal point of interest from countries like the UAE and Saudi Arabia who seek to promote the goals of food security. The setting up of organic and food processing industries is already underway. India shares a $7 billion food security plan, promoted via a food corridor, with the UAE.
The Indian food processing sector is currently ranked number five globally but is growing at a CAGR of 12% and expected to reach US $730 billion by FY24. It accounts for 32% of India’s food market and has an 11.6% share of employment in the domestic food industry.
Saudi Arabian entity Salic is one among a host of companies that have decided to ramp up investments in the Indian agricultural sector. According to Sulaiman AlRumaih, group chief executive of Salic and United Farms Investment Company, “We are keen to deepen engagement with the Indian food processing sector; we are evaluating new investment opportunities.”
Salic will invest in agricultural projects and livestock production by partnering with governments across “multiple geographic areas”, the company said. “With agriculture contributing over 15% to India’s GDP, there is a significant potential for us to invest in and help develop the Indian food processing sector.”
The Indian food processing sector is currently ranked number five globally but is growing at a CAGR of 12% and expected to reach US $730 billion by FY24. It accounts for 32% of India’s food market and has an 11.6% share of employment in the domestic food industry.
India Global Business had earlier analysed the crux of Union Finance minister Nirmala Sitharaman’s annual 2021-2022 budget when she had unveiled ‘Operation Green’ in support of the agricultural community. In Sitharaman’s address was the fundamental fact that food processing would play a crucial role in linking Indian farmers to consumers in domestic and global markets. The government on their part would increase India’s overall competitiveness and capacities in the sector.
To this end the Ministry of Food Processing Industries (MoFPI) has been making all-out efforts to encourage investments across the value chain, the industry currently engages around 1.93 million people in nearly 40,000 registered units with a fixed capital of $32.75 billion and aggregate output of around $160 billion.
The plan is already in place for a 100 percent FDIthrough the government approval route for trading, including through e-commerce in respect of food products manufactured or produced in India. The government is taking further steps to boost investments in the industry. The future for the agricultural sector couldn’t be brighter and promising.