Indian Agro-Based Industry

Indian Agro-Based Industry

India’s 54.6 per cent population is still engaged in agriculture and allied activities. Low income from the primary farm produce and lack of investment in the processing and agri – value chain has caused rapid reduction in farm profits and the farm occupation has now come under severe pressure.

Agro-based Industry

  • Agro-industry encompasses not only the activities that utilize raw materials sourced from agriculture, but also those provide input for modern agronomic practices.
  • Based on the input-output linkages and the interdependence between agriculture and industry, agroindustries can be of two types- (a) processing industries or agro-based industries and (b) input supply industries or agro-industries.

Why Promote Agro-Based Industries

India has the world’s 10th largest arable land, 20 agro-climatic regions and 15 major climates. The harvest and post-harvest losses for agriculture commodities are very high.
  • The total estimated economic value of quantitative loss was found to be Rs. 92651 crore at average annual prices of 2014.
  • There is opportunity of an overall growth of agricultural economy as only 2 to 3 percent of agri-commodities are processed.

Problems and Constraints to the Development of the Agro-Processing Sector

Some of the constraints which seem to bedevil the development of the agro-industrial sector in Dominica and the wider CARICOM region include:

  • An inconsistent and insufficient supply of raw material
  • Seasonality of crops
  • Poor quality of raw material supply and high losses during transport from farm to factory
  • Inappropriate or obsolete processing and ancillary equipment
  • Poor and inconsistent quality of processed products
  • Sub-optimal use of processing facilities and equipment
  • Poorly trained personnel and a lack of qualified food technologists
  • A lack of proper hygiene and sanitation practices
  • Inappropriate packaging materials and high packaging cost
  • Weak or non-existent market development
  • A lack of technical support for the agro-industrial sector
  • Absence of good management of the processing facility once commercialized
  • These problems have been enunciated and debated ad infinitum in many local and regional fora and a range of practical recommendations advanced. However in most, if not all, of the states concerned implementation of these recommendations appear to be non-existent. The very absence of implementation strategies may well be the result of the lack of well thought-out, planned strategies for agro-industrial development. It may be helpful to examine some of these individual constraints.

Government Initiatives:

  • Food Processing and Beverages:The Ministry of Food Processing Industries implements various Central Sector Scheme to boost food-processing industries. It has recently re-structured its schemes under the new Central Sector Scheme – Pradhan Mantri Kisan Sampada Yojna.The scheme components include setting up of (a) Mega Park (b) Integrated Cold Chain and Value Addition Infrastructure (c) Food Safety and Quality Assurance Infrastructure (d) Human Resources Development and Institution.
  • Textiles Industries:The Government has rolled out a number of initiatives. These include:Scheme for Integrated Textiles Park, Integrated Processing Development Scheme, Group Workshed Scheme, Common Facility Centre and Amended Technology Up-gradation Fund Scheme, Scheme for the Development of the power loom Sector (Power Tex), SAMARTH – The Scheme for Capacity Building in Textiles Sector (SCBTS), Comprehensive Handloom Cluster Development Scheme (CHCDS, Rebate of State and Centre Taxes and Levies (ROSCTL) etc.
  • Jute Industry:The Govt. has attempting to modernize the jute mills by increasing their productivity and bringing in modern technology and equipment.National Jute Board’s Schematic interventions, providing capital subsidy to jute mills to address their issues and challenges at hand.
  • Khadi and Village Industry:Ministry of MSME’s Khadi and Village Industries Commission (KVIC) promotes setting up of various post-harvest agro and food based micro industries like processing of pulse, cereals etc.

The inherent advantages of agri-industries are optimal utilization of local agri-resources, mobilization of investment on a large scale, creation of job opportunity, prevention of distress rural-urban migration and reduction of disparity across sectors and regions.

Agri-based industries confirm to the notion of competitive advantage both within and outside the country. They can play a role of a safety valve to absorb surplus rural labour and can address the problem of large scale unemployment/disguised employment in rural areas.

The challenge here is how effectively the government implements its schemes and policy

interventions so as to ensure an all – round industrial growth in rural areas without undermining the identity of village, its socio – economic structure, agri-production systems and the basic agri-manufacturing characteristics.