Submitted By:

Gaurav Goyal
Vikas Singhania Jay Patel Deepak Arora

Shashi Paul
Siraj Kureshi

Ground Reality Key Drivers to be an AGRI super power

Challenges
Opportunities

Strategy
Suggestions

 The largest grower of fruits 15% of world output

Low share of global Exports at 0.5%

The second largest grower of vegetables 11 % of

world output Low share of global exports at 1.7% Cold storage facility available for only 10% of produce

Lowest cost producer of fruits & vegetables

Low farmer income farmer suicide

Source: Task force Report on Development of cold chain in India GOI/CII

 Second highest producer of milk Organized dairy accounts for only 13% of milk produced

Only 70,000 Ton cold storage capacity for 90 million Tones

produced Poor yield per cow

Second largest cattle population 5500 registered & 25770 unregistered slaughter house with no

chilling, freezing & cold storage facility as hot meat market prevails

 Fifth largest producer of eggs

Poultry meat sold as hot in retail market Sixth largest producer of fish 20 30% damage and no cold storage facility in WB, AP, Goa Low processing 2.20 % in fruits 35 % in milk 6 % in poultry Value addition 20% Indias current share in world trade of processed foods 1.60 %

 Market surplus of fruits & vegetables 88%

Farmer sells immediately due to perish ability & absence of proper

infrastructure to keep it for longer period

Market surplus of food grains 60% Farmer keeps some for own consumption, seed purpose and to give

to labor as wages Loss in above equal to annual food grain production in Australia Cost of wastage 6 times amount spent on food subsidy
Farm gate price 25% of domestic consumer retail price against 50% in

developed countries.

Political environment

Optimal Agro climatic conditions

Strong credible coordinating & Promotion agency

Strong Consumer base

Strong Corporate leadership

 Political Environment
Attracts Investment Provides Stability Encourages Infrastructural development Strong credible co-ordinating & promotion agency R & D initiatives including development of high yielding varieties Financial & Technical Assistance Extension activities Grower awareness Strong Corporate Leadership Risk taking abilities Managerial skill development Risk mitigation

 Consuming and Processing Industry

Internal consumption to avoid surplus stock accumulation Encourages Economies of scale Globally Competitive to serve wider base of consumers.

Agro Climatic Conditions

Favorable Growing conditions

Sizeable irrigated acreages. High land productivity, land being a very scarce resource

 Low Level Of Value Addition Bottle necks in cold storage including during transit Seasonality capacity utilization issues e.g. Himachal apples 2006-

07 prod was half of 2005-06 Non Efficient storage/warehousing, processing & marketing techniques Non adoption of efficient technology

 Infrastructure and others Shortage of power High electricity tariff Low area under Irrigation High capital cost -Inadequate institutional finance at low rates High insurance premium in risk coverage Farm connectivity by road yet to take off

India
Farmer

Consolidator

Commission agent

Trader

Wholesaler

Retailer

Consumer

High wastage and low margins Consumer Retailer Developed countries Farmer Wholesaler High investments Low wastage better margins

 52% cultivable land as against 11% world wide Unsurpassed Natural Advantages All the 15 major climates of the world 46 out of the 60 soil types 17% animal, 12% plant and 10% fish genetic resource of the world Food processing sector ranks fifth in terms of contribution to GDP Indian urban food market estimated at 350,000 crore

Source: FICCI/KPMG study and Task force Report on Development of cold chain in India GOI/CII

 Included in the list of Priority sector lending by banks since 1999 Most of processed food Exempted from purview of licensing under the

industries (Development & regulation) Act, 1951, except items reserved for small scale sector & alcoholic beverages
Excise duty for processed fruits & vegetables, food mixes etc. NIL Excise duty on reefer vans reduced from 16 to 8% Reduction in customs duty on food processing machinery

 Horticulture crops Fruits vegetables and flowers cover 7% of cropped

area of the country

India ranks First in production of mango (65% of world) Bananas (11%

of world) and papayas

India ranks Second in production of Lime and lemon Exports quantity increased 4 times & value 10 times in last 15 years Move to invest in 10 mega food parks in the country Indian food processing industry averaging a growth of 10%

 Food sector the highest multiplier effect of any industry 2.4 Tripling the size of the industry would generate Direct employment 28 lakh and Indirect employment 74 lakh Thrust in agriculture to be provide the next push to GDP and

prosperity
Enhanced export earnings to compensate for any slow down in IT

related exports India - Sone Ki Chidiya

THANK YOU