Agro and Food processing Industry in India: Status, Opportunities & Challenges

Ajay H Shukla & Swapna D Pawar Asst. Prof. at Matoshri College of Management & Research Centre ahs.nsk@gmail.com, swapna8pawar@rediffmail.com 902121 7110.

ABSTRACT

Agriculture and industry have traditionally been viewed as two separate sectors both in terms of their characteristics and their role in economic growth, however over as few decades Agro and food process has rapidly expanded as an Organized industry with a bright role to be played in Socio-economic development of a country. Our paper endeavors to put an insight on the status and evolution of this industry in India, encompassing the Govt. reforms, subsidiaries, Incentives, technological development, R&D, export potential, growth trajectory, constraints, competition etc by interviewing various related Entrepreneur in the field with a focus to get a hawk eye view from the horses mouth. Based on which we propose to come up with an industry oriented action plan to foster the growth and advancement of the Industry and people attach to it.

1.0 Introduction: `Agro-industry' is an omnibus expression. It could cover a variety of

industrial,manufacturing and processing activities based on agricultural raw materials as also activities and services that go as inputs to agriculture.The agro-industries corporations, set up during the 'sixties in most states, have mainly been engaged in supply of farm machinery, fertilizers, seeds and other modern inputs available to farmers. Food processing industry in India is a sunrise sector that has gained prominence over the recent years. Availability of raw materials, changing lifestyles and appropriate fiscal policies has given a considerable push to the industrys growth. This sector serves as a vital link between the agriculture and industrial segments of the economy. Adequate focus on this sector could greatly alleviate our concerns on food security and food inflation. Strengthening this link is of critical importance to reduce waste of agricultural raw materials, improve the value of agricultural produce by increasing shelf-life as well as by fortifying the nutritive capacity of the food products; ensure remunerative prices to farmers as well as affordable prices to consumers. India already is a leading exporter of several food products. To ensure that this sector gets the stimulus it deserves, Ministry of Food Processing Industries is implementing a number of programmes for Infrastructure development, technology up-gradation & modernization, human resources development and R&D in the Food Processing Sector. As per the GOI (Ministry) food processing industries, includes items pertaining to these two processes viz. (a) Manufactured Processes: If any raw product of agriculture, animal husbandry or fisheries is transformed through a process [involving employees, power, machines or money] in such a way that its original physical properties undergo a change and if the transformed product is edible and has commercial value, then it comes within the domain of Food Processing Industries and (b) Other Value-Added Processes: Hence, if there is significant value addition (increased shelf life, shelled and ready for consumption etc.) such produce also comes under food processing, even if it does not undergo manufacturing processes.

The Ministry of Food Processing Industries does not deal with a few food items such as coffee, tea, oilseeds, spices etc. as the allocation of these items are with other Ministries under the Allocation of Business Rules for Central Ministries. However, all these items are also included in the data base in order to provide a Comprehensive picture of the industry. Another useful classification of agroprocessing industry is in upstream and downstream industries. Upstream industries are engaged in the initial processing of agricultural commodities. Examples are rice and flour milling, leather tanning, cotton ginning, oil pressing, saw milling and fish canning. Downstream industries undertake further manufacturing operations on intermediate products made from agricultural materials. Examples are bread, biscuit and noodle making, textile spinning and weaving; paper production; clothing and footwear manufacturing; and rubber manufactures 1.1 Research Methodology: The study was conducted with following objectives i. To get an overview of Agro processing as an organized industry in current Market scenario. ii. To undertake a prose con analysis of industry with reference to the growth potentials available & constraints faced by the Industrialist. iii. To come up with a valuable suggestions to the Industry and Government so as to facilitate the growth and performance of industry. The methodology followed includes utilization of both primary and secondary data.The primary data was collected by interacting with experts from diversified Agro processing Industries like Winery, Rice and Bhagar processing Industry, Ayurvedic and herbal products, Dairy and Allied product etc with a view to get a detailed insight from the people actually on the field The secondary data includes data collected from study of various reports published by respective Ministry, Government Authorities and Researchers. Some of the statistical data has been borrowed from related books and journals.

2. Historical Review: 2.1 Origin of Agriculture: The beginning of 'agro' or 'agriculture' marks the beginning of 'civilized' or 'sedentary' society. Climate change and increase in population during the Holocene Era (10,000 BC onwards) led to the evolution of agriculture. During the Bronze Age (9000 BC onwards), domestication of plants and animals transformed the profession of the early Homo sapiens from hunting and gathering to selective hunting, herding and finally to settled agriculture. Eventually the agricultural practices enabled people to establish permanent settlements and expand urban based societies. Cultivation marks the transition from nomadic pre-historic societies to the settled neolithic lifestyle some time around 7000 BC. As per the modern definition of agriculture which would be" an aggregate of large scale intensive cultivation of land, mono-cropping, organized irrigation, and use of a specialized labor force", the title "inventors of agriculture" would go to the Sumerians, starting ca. 5,500 BC. The Renaissance saw the innovation of the three field system of crop rotation and wide spread usage of the moldboard plow. The early phase of Industrial Revolution witnessed new agricultural practices like enclosure, mechanization, four-field crop rotation and selective breeding. The science-driven innovations of 19th and 20th centuries led to the mechanization of the cultivation, i.e. the use of tractors. 2.2 Indias Tryst with Green Revolution Agriculture in India, the preeminent sector of the economy, is the source of livelihood of almost two thirds of the workforce in the country. The contribution of agriculture and allied activities to India's economic growth in recent years has been no less significant than that of industry and services. The importance of agriculture to the country is best summed up by this statement: "`If agriculture survives, India survives". Policy makers and planners, in order to address the concerns about national independence, security, and political stability realized that self-sufficiency in food production was an absolute prerequisite. This perception led to a program of agricultural improvement called

the Intensive Agriculture District Programme (IADP) and eventually to the Green Revolution. The National Bank for Agriculture and Rural Development (NABARD) was set up. All these steps led to a quantum jump in the productivity and production of crops. 2.3 Technological devlopment in the field of agroprocessing industry: As per the Study by R. P. Kachru Asstt. Director General (Process Engineering), Indian Council of Agricultural Research, New Delhi. R&D Work in agro-processing carried out in India during the last 50 years categorized as follows:
o

Studies materials.

on

physical,

biochemical,

nutritional,

and

engineering

properties/characteristics of different food, feed, fibre, and industrial raw Response studies of different biological materials w.r.t. their storage, handling, and moisture conditioning.
o

Refinement of traditional equipment and processes for production of different foods, feeds, fibres and fuel materials for better quality, higher capacity, energy efficiency, and reduced drudgery to workers. Development of new produces and processes for better nutrition, convenience and taste. Enhancement of shelf life of the produces, safe storage/packaging and development of better performing materials. Better economic utilization of agricultural residues, by-products and recycling of wastes. Design and Development of instruments and equipment for post harvest operations and their evaluation, feasibility analysis, field trails/multilocation evaluation etc. Design, layout planning and development of pilot plants, agricultural produce bulk handling systems and area specific agro-processing models. Studies and modeling/simulation of post harvest systems and industry for the purpose of optimization, forecasting and policy analysis. Energy auditing and use of non-renewable sources of energy for post harvest operations. Product quality analysis, sensory evaluation and consumer acceptance studies.

Work conditions, safety and pollution control.

Among large number of technologies developed, themost popular ones include: 1. Agriculture produce refinement equipment such as, cleaners, graders and driers for onfarm operations as well as industrial operations. 2. Processes and equipment for parboiling of rice, preparation of puffed rice and flaked rice. 3. Development of processes and equipment for processing of pulses to produce dhal for higher recovery and better quality. 4. Development of driers using agricultural residues, by-products and solar energy. 5. Adoption and development of processes, and equipment for production of protein rich produces such as full fat soy flour, soy drink/ soy milk, soy paneer (TOFU) and soy fortified baked products. 6. Development of equipment such as, leaf cup and dona making machine, multipurpose mills, mini flour mill, grain pearlers, maize dehuskers, shellers, groundnut decorticators, fruit graders, juice extractors, high recovery mechanical oil expellers and improved storagenergy efficiency, and reduced drudgery to workers. 7. Processes and equipment for production of high quality ground spices and spice mix, development of raw materials and processes for production of instant sweets, curries, snack foods, instant soft drinks, idli, dosa, sambhar mixes/powders, egge structures for cereals, pulses, oilseeds, onion and potato.

3.Policy Initiatives towards the development of Agroprocessing sector: After liberalization several policy measures have been taken with regard to regulation and control, export and import, fiscal policy, exchange and interest rate control taxation, export promotion and incentives to high priority industries. Food processing and agro industries have been accorded high priority with a number of important relieves and incentives. The objective of every policy initiative has been to make Indian agriculture globally competitive by investing it with the ability to produce globally acceptable quality at

comparable cost some of the important policy changes towards food processing industry are as follows 3.1
o

Regulation and Control: Most of the processed food items have been exempted from the purview of licensing under the Industries, Development and regulation, Act, 1951, except items reserved for small-scale sector and alcoholic beverages. As per extent policy Foreign Direct Investment up to 100% is permitted under the automatic route in the food infrastructure like Food Park, Cold Chain and warehousing. Asfar as food retail is concerned the FDI policy does not permit FDI into retail sector except Single Brand Product Retailing. This policy is uniform for all retailing activity. FDI policy for manufacture of items reserved for the Small Scale Industry sector is uniform for all items so reserved and a separate dispensation for items in the foodprocessing sector is not contemplated. The policy for distillation of alcohol has been announced vide Press Note 4 (2006) according to which FDI upto 100% is permitted on the automatic route for distillation and brewing of alcohol subject to licensing by the appropriate authority. No industrial license is required for almost all of the food and agro processing industries except for some items like beer, potable alcohol and wines, cane sugar, hydrogenated animal fats and oils etc. and items reserved for exclusive manufacture in the small scale sector. Items reserved for S.S.I. include pickles and chutneys, bread, confectionery, excluding chocolate, toffees and chewing-gum etc., rapeseed, mustard, sesame and groundnut oils (except solvent extracted), ground and processed spices other than spice oil and oleoresins, sweetened cashew nut products, tapioca sago and tapioca flour. Use of foreign brand names is now freely permitted the government. MRTP (Monopolies and Restrictive Trade Practices Act) rules and FERA (Foreign Exchange Regulation Act) regulations have been relaxed and given more freedom to encourage investment and expansion by large corporates.

o o

Most of the items can be freely imported and exported except for items in the negative lists for imports and exports. Capital goods are also freely importable, including second hand ones in the food-processing sector.

3.2

Fiscal policy and taxation:

o Custom duty rates have been substantially reduced on food processing plant and equipments, as well as on raw materials and intermediates, especially for export production. o Wide-ranging fiscal policy changes have been introduced progressively in food processing sector. Excise and Import duty rates have been reduced substantially. Many processed food items are totally exempt from excise duty. o Corporate taxes have been reduced and there is a shift towards market related interest rates. There are tax incentives for new manufacturing units for certain years, except for industries like beer, wine, aerated water using flavouring concentrates, confectionery, chocolates etc. o Indian currency, rupee, is now fully convertible on current account and convertibility on capital account with unified exchange rate mechanism is foreseen in coming years.
o

Repatriation of profits is freely permitted in many industries except for some, where there is an additional requirement of balancing the dividend payments through export earnings.

3.4

Export promotion Scemes :

o Food processing industry is one of the growing areas identified for exports. Free Trade Zones (FTZ) and Export Processing Zones (EPZ) have been set up with all infrastructures. Also, setting up of 100% Export oriented units (EOU) is encouraged in other areas. They may import free of duty all types of goods, including capital foods. o Capital goods, including spares upto 20% of the CIF value of the Capital goods may be imported at a concessional rate of Customs duty subject to certain export obligations under the EPCG scheme, Export Promotion Capital Goods. Export linked duty free imports are also allowed.

o Units in EPZ/FTZ and 100% Export oriented units can retain 50% of foreign exchange receipts in foreign currency accounts. o 50% of the production of EPZ/FTZ and 100% EOU units is saleable in domestic tariff area.

3.4.1 Agro Processing Export Scenario: Major Trading Partner of India 1) Bangladesh 2) U.A.E 3) Saudi Arabia 4) Malaysia 5) U.S.A. 6) Kuwait 7) U.K. 8) Indonesia 9) Yamen Arab Republic 10) Cote D Ivoire

3.5 Institutional support for the development of Agro and food processing sector There are various institutions providing assistance to food and agro processing industries: 1) APEDA - APEDA is an Agricultural & Processed Food product Export Development Authority of Min. of Commerce & Industry, Govt. of India and is engaged in augmenting, promoting and monitoring the exports of agro products including rice. It also provides financial assistance to merchant & industrial exporters and has formulated various schemes approved by Govt. of India. APEDA provides financial assistance to its registered member exporters under the following schemes: o Scheme for Market Development

o Scheme for Infrastructure Development o Scheme for Quality Development o Scheme for Research and Development o Scheme for Transport Assistance 2) CFTRI: The Institute has geared up its R&D and impact of the globalisation has given very good dividends with a large number of externally funded projects from national and international agencies. The present scenario in the country is very vibrant with rising capital investment in food industry, which is expanding at a rapid pace in urban markets for processed foods, especially for the traditional foods through eco-friendly technologies. The role of CFTRI has always been on a high pedestal in the areas of human resource development and R&D partnerships cherished through the international linkages with institutions such as the Institute of Food Technologists (USA), UN University (Tokyo), European Economic Commission (Belgium), National Science Foundation (USA) and many more. CFTRI is an ISO 9001:2008 and ISO 14001:2004 organisation and NABL accredited for chemical and biological testing of samples.
3) ICAR: The Council is the apex body for co-ordinating, guiding and managing

research and education in agriculture including horticulture, fisheries and animal sciences in the entire country. With 97 ICAR institutes and 47 agricultural universities spread across the country this is one of the largest national agricultural systems in the world. the ICAR has played a pioneering role in ushering Green Revolution and subsequent developments in agriculture in India through its research and technology development that has enabled the country to increase the production of foodgrains by 4 times, horticultural crops by 6 times, fish by 9 times (marine 5 times and inland 17 times), milk 6 times and eggs 27 times since 1950-51, thus making a visible impact on the national food and nutritional security. It has played a major role in promoting excellence in higher education in agriculture. It is

engaged in cutting edge areas of science and technology development and its scientists are internationally acknowledged in their fields.
4) MPEDA: he Marine Products Export Development Authority (MPEDA) was

constituted in 1972 under the Marine Products Export Development Authority Act 1972 (No.13 of 1972).
Work Programme of MPEDA

o Registration of infrastructure facilities for seafood Export trade o Collection and dissemination of trade information o Projection of Indian marine products in overseas markets by participation in overseas fairs and organizing international seafood fairs in India. o Implementation of development measures vital to the industry like distribution of insulated fish boxes, putting up fish landing platforms, improvement of peeling sheds, modernization of industry such as upgrading of plate freezers, installation of IQF machinery, generator sets, ice making machineries, quality control laboratory etc. o Promotion of aquaculture for production of shrimp and prawn for export. 5) National Dairy Reaserch Institution: The National Dairy Research Institute as country's premier Dairy Research institution has developed considerable expertise over the last five decades in different areas of Dairy Production, Processing, Management and Human Resource Development. Information generated at the Institute and the services offered have contributed to the growth of Dairy Industry as a whole and well-being of millions of milk producers and consumers of milk and milk products. Realizing the challenging need of global Dairy Trade, the Institute is continuously working to develop its R&D and HRD programmes to better serve the nation in terms of food security, employment generation, poverty alleviation and economic prosperity.

4 Data Analysis:

It is widely realized that agro-based industries are essential ways for the attainment of national objectives, especially poverty alleviation and economic development in the rural areas. However, such industries face several problems. Some of the problems could be dealt with by the industries themselves and others require government intervention and even the cooperation of international agencies. The major issues concerned with agro-based industries specifically Winery, Rice milling, diary, Ayurvedic and herbal sector are as follows 4.1 WINERY: STRENGTHS o Indian wine consumption has grown 25-30% annually over a 5 year period. o Good climate for grape growing
o o

Urban population is increasing. Youth are craving an alternative to hard liquors and developing a more refined taste. Wine is becoming more acceptable to women and youth.

OPPORTUNITIES
o

100 million persons will be legally allowed to drink alcohol (25 yrs. old) in the next 5 years. Supermarkets are emerging to support wine distribution infrastructure.

o Domestic market with increasing disposable income.

o

Growing tourism industry. Wine remains an elite taste. Wine is difficult to store in India due to lack of cellars and refrigeration. Less than 50 percent of the population is legally old enough to drink (25 yrs. old). 400 million persons are 18 years old or younger. Poor awareness of wine and infrastructure

WEAKNESSES
o o o o o

THREATS
o o o o o

The Indian constitution discourages alcohol consumption. Wine viewed as a sin by some. Indians still prefer whisky. Advertising for alcoholic beverages is banned. Domestic wine production is coddled by state governments.

4.2 RICE MILLING: The analysis of the cluster has been undertaken in terms of following parameters: 1. Market 2. Technology 3. Inputs availability 4. Innovation capability 5. Human Resource /Skill 6. Business Environment This analysis identifies the strong & weak areas as well as threats & opportunities envisaged in the cluster as below: STRENGTHS: o Strong presence in International & Domestic market. o Market support available under Levy/CMR Policy o Most suitable climatic environment o Low cost fabricated machines o Technological infrastructure available o Bulk supply of raw materials at competitive price.

o Exporters given incentives and subsidized materials. o Local resources available o Capability to produce world class quality o Ability to run non standardized machines o Workers mostly skilled for traditional technology o Ability of Export segment to grow & meet International challenges OPPORTUNITY: o Tremendous exports potential o Substantial institutional support available. o Non-exporting units to club for common brand and export o Potential for productivity. o cost reduction & quality enhancement by use of appropriate technology/QMS WEAKNESS: o Long 6 months off season for majority of non exporting units . o Weak Brand equity of non exporting units . o Compulsory & controlled marketing for levy rice. o High production /automatic plants very costly & mostly imported beyond reach of SSI sector. o Entrepreneurs not aware of sources of low cost imported automatic plants and appropriate processing techniques. o Locally fabricated plant are unstandardised & low productive. o Controlled MSP of paddy & compulsion of levy rice supply. o Non Exporters production cost high. THREATS: o Strong competition from asian countries. o Patent exploitation of Indian Basmati by International market o Traditional Technology, standard & non professional MS leading to high cost may retard the industry both at domestic / International market

4.3 AYURVEDA & HERBS: World Herbal Industry Indian Herbal Industry o Herbal Products Market :USD 80 o Indian Market : Estimated as Rs. 4205 billion o Annual Growth Rate : 7% o By 2050 : market Size is expected to reach 6 trillion Source : EXIM Bank Report STRENGHTS: Ashtavaidya tradition:Ayurveda is a holistic health system which aims at bringing about
harmony in the body, and harmony of humans with nature. o o Proven Track Record: Ayurveda has been in practice for over 5000 years, and it has evidently worked, faith in it sustains especially among the Indian population
o o o

crores Export of Ayurvedic drugs & allied herbal products : Estimated as Rs. 440 crores Potential by 2020 : Estimated as Rs. 7000 crores

Authentic Ayurvedic products :It has stood the test of time, of centuries, and this knowledge
of medicine can be preventive, protective and curative.

o People are having better perception towards Ayurvedic Medicines against Allopathic. o Limited but Well trained medical and paramedical staff available easily and at low cost especially in semi urban and rural areas. BOTTLE NECKS FOR SECTOR
o o o o o o o

Lack of documented validation of Products, quality control procedures. & process Batch to batch variation in product. Toxicity profile -not explained Efficacy -not scientifically proved & documented Quality assurance protocol -not properly designed. Lack of world class treatment centers. Lack of NABH accreditation.

o o

Lack of health Insurance approval. Limited of well trained man power.

THREAT AND CHALLENGES o Shortage of raw materials o Escalation in raw materials price o Lowering of standards in the products o Adulteration in the raw materials o Unhealthy growth of fake massage parlors. 4.4 DAIRY & COLD CHAIN: Based on interaction with Mr.Amol Sanap coordinator of Sanap Dairy , Makhamalabad, Nashik following conclusions were drawn: STRENGTHS:
o o o

Demand profile: Absolutely optimistic. Margins: Quite reasonable, even on packed liquid milk Flexibility of product mix: Tremendous. With balancing equipment, you can keep on adding to your product line. Availability of raw material: Abundant. Presently, more than 80 per cent of milk produced is flowing into the unorganized sector, which requires proper channelization.

Technical manpower: Professionally-trained, technical human resource pool, built over last 30 years.

WEAKNESSES:
o

Perishability: Pasteurization has overcome this weakness partially. UHT gives milk long life. Surely, many new processes will follow to improve milk quality and extend its shelf life.

Lack of control over yield: Theoretically, there is little control over milk yield. However, increased awareness of developments like embryo transplant, artificial insemination and properly managed animal husbandry practices, coupled with higher income to rural milk producers should automatically lead to improvement in milk yields.

Logistics of procurement: Woes of bad roads and inadequate transportation facility make milk procurement problematic. But with the overall economic improvement in India, these problems would also get solved.

Problematic distribution: Yes, all is not well with distribution. But then if ice creams can be sold virtually at every nook and corner, why cant we sell other dairy products too?Moreover, it is only a matter of time before we see the emergence of a cold chain linking the producer to the refrigerator at the consumers home!

Competition: With so many newcomers entering this industry, competition is becoming tougher day by day. But then competition has to be faced as a ground reality. The marketis large enough for many to carve out their niche

OPPORTUNITIES: "Failure is never final, and success never ending. Dr Kurien bears out this statement perfectly. He entered the industry when there were only threats. He met failure head-on, and now he clearly is an example of never ending success! If dairy entrepreneurs are looking for opportunities in India, the following areas must be tapped:
o Growth in Milk Production: India is the highest milk producer in the world

contributing 88 million tons to the total milk production of 584.6 million tons (FAO, Rome). Indias milk production today accounts for more than 13 percent of the total world output and 57 percent of Asias total production. Milk production economy is based on conversion of agro by-products and opportunity labor (Khanna, 1999). Therefore the cost of milk production is low, the farm-gate price of milk in India is

one of the lowest in the world. This would increase Indias pie in the world total milk production presenting an opportunity for increasing share in the international market.

o Economic Growth: Demand for milk and milk products receive a boost from the

economic growth-taking place in India. As incomes rise, milk and milk products add to the traditional diet. India has witnessed a GDP growth of 7/8 percent per annum over the last 10 years and witnessing rapid increase.
o Growth in Population: The world population is expected to increase by 1.5 percent

per annum. Most estimates suggest that in 2025, total world population will be between 8.1 and 8.5 billion.. India will account for 30 percent of the growth in the population base of Asia
o Increasing Urbanization: Increasing urbanization is expected to expand the potential

market for the dairy sector. Presently, only 988 out of 3,700 cities and towns in India are served by its milk distribution network, dispensing hygienically packed wholesome, quality pasteurized milk.
o Changing Face of Domestic Market: Food service institutional market is growing at

double the rate of consumer market. There is an increasing consumption of food products away-from-home.The concept of parlors is opening new vistas for ready-toserve dairy products, which would ride piggyback on the fast food revolution sweeping urban India.
o Domestic Demand: India is the worlds largest consumer of liquid milk. Milk

occupies prideof place as the most coveted food in the Indian diet, after wheat and rice. According to consumer survey conducted by the National Sample Survey Organization (NSSO), the consumption of livestock products,particularly milk, has gained popularity in the last two decades both in the rural and urban areas.

o Liquid Milk: Presently, the modern milk distribution network supplies hygienically

packed quality pasteurized milk to about 1,000 cities and towns. This number could go up by almost five times in the foreseeable future
o Value Added Products: The domestic market for value added products like butter,

cheese, ice cream, dairy whiteners and spreads is galloping at 8-10 percent per year.
o Branded Ethnic Dairy Products: are witnessing rising demand and increased

acceptance,especially among urban consumers.

o Export Potential: India is a very minor player in the world market. Imports of dairy

products is occasional and in small quantities.

CHALLENGES:
o o o o o o o o

Organizing milk producers under cooperatives, Provision of veterinary services, feeds and fodders in a cost effective manner, Promoting hygienic practices of milk production, Increasing milk production and per capita availability, Producing and marketing high volumes of dairy products with low margins, Meeting international standards and increasing exports, Tackling the menace of production of artfficial milk, Promoting sheep, goat and camel milk, commercial production of traditional products.

o o o

Innovating product varieties, Feedback towards appropriate government policies, and Reducing adverse environmental impacts of dairying.

5. RECOMMENDATION
o

National level plan for improvement and extension of agro-processing technology at farm, traditional small industry and modern industry levels should be prepared. The plan should take into account the diversity in resources and needs of different regions in the Country. It should include programme details and implementation schedule for the first four or five years. The progress of plan implementation should be periodically reviewed to allow adjustments and corrective measures, and to develop programme details for the years beyond the period under review.

Thrust areas for research and development should be identified and medium term research and development programme should be prepared and implemented to support the national plan for improvement and extension of agro-processing technology at different levels. Treatment and utilization of effluents from agroprocessing industry should be included in the R.D. programme.

o Emphasis should be put on the establishment of new agro-industrial plants in the production catchments to minimize transport cost, make use lower cost land and more abundant water supply, create employment opportunity in the rural sector and utilize process waste and by-products for feed, irrigation and manure. o Infrastructure in the production catchments selected for agro-industrial

development should be improved. Because of uncertain grid power supply to rural areas, decentralized power generation using locally available resources may become an integral part of agro-industrial development. Similarly, if the raw materials and processed products are perishable or semiperishable in nature, cold chain will have to be established. o The national plan should provide for management of agro-industrial activities in the catchment area, both by private companies and individuals as well as cooperatives.

o Financial incentives and support should be provided on liberal scale to promote the modernization of agro-processing industry and for establishing new such industries in production catchments. o Arrangements to supply market information to the farmer and agro-processor should be put in place.

o Other Miscellanies Suggestions Promote cultivation of specific plants & crops Implement good agricultural practice, good pre and post harvesting practices and good storage practices Promote single point sourcing of raw materials and information centres Promote sustainable harvesting of minor forest and rare produces Initiatives for high quality chain. Training for soft skill development for allied staff. Specialized institutes for developing

REFERENCES: India Economics, Misra & Puri 27th Rev Editin, Himalaya Publication House, Mumbai.

Modern Technology of Agro Processing & Agricultural Waste Products. National

Institute of Industrial Research, New Delhi.

For a review of their working, see: N R Kothare, "Agro-industries Corporations", Reserve Bank of India Bulletin, Vol XXXII, No 2, February 1978, p. 80.b

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