MUMBAI, 29 JULY, 2020 (GPN): A study conducted by MVIRDC World Trade Center Mumbai found that India can be among the top five exporters of agro commodities in the world if the central and state governments take effective measures to handhold farmers.
The study was released at a time when Government of India announced major reforms such as allowing farmers to sell produce outside the regulated APMC markets, relaxing Essential Commodities Act etc., as part of the Aatmanirbhar economic package in May 2020.
Currently, India ranks eighth with annual agro exports of USD 39 billion (bn), after EU (USD 181 bn), USA (USD 172 bn), Brazil (USD 93 bn), China (USD 83 bn), Canada (USD 69 bn), Indonesia (USD 46 bn) and Thailand (USD 44 bn), latest data from WTO shows.
Through focused intervention in capacity building, India can enhance its agro export to surpass Thailand and Indonesia and become the fifth largest exporter in the world.
As a first strategy, the government should re-orient the role of its extension centres, viz. the 715 Krishi Vigyan Kendras (KVKs) across the country, to handhold farmers in growing those varieties of crops that are demanded in the global market.
Many a times, India’s export consignments are rejected because of presence of pesticides above the prescribed Maximum Residual Limits (MRLs) in foreign countries. KVKs should guide farmers on prudential use of pesticides and other agro chemicals so that they conform to the global quality standards.
Speaking about the export strategy for agriculture sector, Ms. Rupa Naik, Senior Director, MVIRDC World Trade Center Mumbai said, “India’s agriculture extension system was developed in the days of Green Revolution when increasing quantity to attain self-sufficiency was the policy target. Now that India has attained self-sufficiency in agriculture, we need to re-orient our extension services towards growing quality food for the global market, rather than quantity.”
Explaining further about the export-oriented approach for agriculture, Ms. Naik said, “India produces huge quantity of food crops, majority of which are not of suitable for further processing or value addition. It is time India focuses on cultivating horticulture crops that conform to the quality, colour, shape and chemical contents acceptable in foreign countries or which are fit for further processing.”
India is the second largest producer of fruits and vegetables in the world and yet its share in world exports is 1.7-1.8%. India is the largest producer of papaya, lemons and limes; but meets hardly 3.2% of the world import demand for papaya, 0.5% of world import demand for lemons and limes, shows data from FAO.
In the last decade, India has made remarkable progress in export of niche products such as capsicum chilly, castor oil, tobacco extracts and sweet biscuits. India has also made considerable progress in export of basmati rice, meat and marine products. These success stories should be replicated in other potential food products.
India has less than 1% share in world exports of beverages, floriculture, cereal preparations, flour and starch, processed fruits and vegetables. India should explore South Asia and ASEAN markets for beverages. According to the study, India can tap USD 1.46 billion worth import demand for non alcoholic beverages in South Asia and ASEAN countries.
India is said to have the second largest resource of bamboo after China, with 136 species and around 13.96 million hectare of land under bamboo cultivation, the highest in the world. Despite this, India exports hardly USD 64 million worth of value added bamboo products, which caters to hardly 2.83% of world import (of USD 2.26 billion).
It is a cause of concern that India’s export of mango pulp has declined from 154,820 tonne in 2014-15 to 105,873 tonne in 2018-19. There is a need to set up more mango clusters in the country to enhance production capacity and arrest this declining trend.
The study carries meticulous analysis of EXIM data to highlight export potential across fruits, vegetables, honey, marine products and value added agro commodities. The study proposes 18 policy recommendations to strengthen India’s agriculture exports, based on survey conducted with industry players, agriculture scientists and consultants from global institutions such as World Bank and FAO.
A summary of the study can be accessed from the weblink:
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