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Agri Exports Maintain healthy Trend (22 April, 2021)

Agri Exports Maintain healthy Trend (22 April, 2021)

Context:

  • Though the coronavirus pandemic hit all the sectors of the economy in the country, the growth in the export of agricultural commodities continues in the country.

Background:

  • In 1950-51, India’s Agri Export was about Rs 149 crore which has risen to the level of Rs 2.53 lakh crore in 2019-20.

  • The agricultural exports as a percentage of India’s agricultural GDP has increased from 9.4 percent in 2017-18 to 9.9 percent in 2018-19.

  • While the agricultural imports as a percentage of India’s agricultural GDP has declined from 5.7 per cent to 4.9 percent indicating exportable surplus and decreased dependence on import of agricultural products in India.

  • India's agricultural and allied exports during the entire 2019-20 fiscal was Rs 2.52 lakh crore, while imports were at Rs 1.47 lakh crore.

Summary of the Debate

How Indian agriculture has emerged as the bright spot where the COVID-19 pandemic has disrupted economies worldwide?

  • The export of Agri and allied commodities during Apr, 2020 - Feb, 2021 was worth 2.74 lakh Crore as compared to Rs. 2.31 Crore in the same period last year indicating an increase of 18.49%.

  • The commodities which posted significant positive growth in exports were wheat, Other Cereals, Rice (other than Basmati), Soya meal, Spices, Sugar, Raw Cotton, Fresh Vegetable, Processed Vegetables, and Alcoholic Beverages.

  • The farmers, entire industries, entrepreneurs, exporters and the favorable government policies, the incentives they have given, all that has helped in achieving this target.

  • In the start of the year, there were many challenges in terms of supply management, in terms of logistics, in terms of labor management, in terms of finance and many other challenges were there.

  • But we continued the supply chain, continued exports and we ensured that the supply is not affected.

  • There were many countries who were looking to India to supply food items and we ensured that their requirement is sent in time as per the requirement and the quality they wanted and many of times, they sent a special chartered plane to ensure that their supply is not affected.

  • Many of countries are playing very safe that whether to export or not export basically, but India was in a position to export, we had a tremendous surplus of grains.

What were some of the country's specific initiatives or approaches that India took on the export front?

  • The financial incentives they were given, whether it is interest subvention scheme then there were other schemes of Ministry of Food Processing and APEDA also and state governments also encouraged.

  • Throughout the year, we ensured tremendous amount of ease of doing business, favorable government policies were there.

  • There are virtually zero compliances, not compromising on the quality, we ensure that we meet the required quality of the importing country and also of the whatever is the required and quality norms of the domestic market.

  • The entire government machinery was working 24 hours. We were providing them all kinds of support from providing curfew passes for their labor to the finding problem at the port.

  • We conducted buyer seller meets, because we cannot have trade fairs participation. We conducted 25 virtual buyers in a meet with the help of embassies.

  • Everybody ensured that they were able to be at comfort to ensure that the COVID pandemic is not affected the supply chain and all the exports which we have been doing.

Efforts that need to diversify the export basket and to boost high value and value-added agricultural exports:

  • Although, we have expanded all across South America and African countries. Traditionally, we are exporting cereal to these countries.

  • The next step is to ensure that high value export takes place instead of going for the volume part, high value export will give us fetch more money especially, in Europe and American market.

  • We need testability in all other products because there are high paying consumers in Europe or America, and also many of the developed countries like Japan, South Korea have a stringent food standard.

  • Another new emerging area is the northeastern states, the northeastern states endowed with richness in terms of horticulture produce and agriculture produce.

  • Now, during the COVID time, there has been huge export of fruits and vegetables from northeastern states to many of the Dubai markets and other markets.

  • The Agriculture Export Policy has a zonal system, so every district has its own unique product.

  • During the COVID time, India exported fresh fruits and vegetables to European market. That means, we have a robust system and that brings to why we need a contract farming because this ensure that because of contract farming that happened.

 How GI tag has helped agricultural exports of India?

  • We have now at present 130 Agri products which are registered as GI and after this, Basmati rice, Darjeeling tea and many other products are known to the people, but many of them at a production level is not that significant that we go for exports, we have to develop their export base.

  • But GI is an important aspect even honorable Prime Minister is also giving emphasize to GI.

  • With GI, we will be able to sell our produce easily and also at a premium and ultimately, those who are producing and developing these GI products, they will be benefited in the chain.

  • Presently, tourism is affected but when tourists come to India, they would definitely like to buy something which is unique to that country, and a product with GI tag is a unique product. So, they would like to buy those unique products and carry to their countries on way back and take it as a souvenir to the people.

  • We are also ensuring that these GI tags are well protected, well defended and well administered also at the same time.

  • So, GI is going to be promoted very well in the coming times and that will open new avenues for the business.

What is the way ahead for a more coordinated approach between Centre and States?

  • Agriculture Policy which has come is a link between Centre and States for the purposes of exports.

  • We are working in close coordination with the states, all states have their nodal office as far as Agri Exports are concerned.

  • All states have their nodal officers specifically, who are dedicated and concentrating on exports.

  • Many of the states have declared their own State Agriculture Export Policy.

  • In Northeastern states, we are developing very well, we are working in close coordination with the states.

  • This year, the exports is likely to be at least 30 to 35 percent more than the last year on the north eastern region.

  • This is all close coordination between the states and the center which has resulted in this, which is going to give us better results in the coming times also.

Way ahead to boost Agri-Exports and doubling farmers income:

  • We need contract farming if we want to improve export and quality.

  • We need more investment in the value chain.

  • There is need of more smooth ties between center and states which is going on now for boosting export and Indian product will be soon known as the produce of India like basmati rice and other product will be also known like best fruits, vegetables from India.

  • Exports helps in generating a bulk demand because there are two ways of doing:

  • Develop a supply and then go for selling it outside.

  • Generate demand, when the demand is there then it is relatively easier to develop the supply chain management.

  • So, exports help in generating bulk demand when the bulk demand is there, the supply chain always develops and then there is a better supply and better remuneration to those who are supplying including the farmers and those who are in the supply chain management.

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