011 Indian Agriculture and Food Management

Indian Agriculture

2020-06-25 16:11:32


  • 16.5% of GDP, 55.4% of employment, 10% of export earning
  • It is the biggest private sector too since it carries no burden of individual income tax
  • It is the biggest unorganised sector in with more than 90% of unorganised labour share.
  • IN has 2.15% of worlds agriculture trade and net exporter of agri products.
  • 1% inc in agricultural growth results in 0.5% inc in industrial output and 0.7% inc in national income of India.
  • 66.1% of cropped area still depends on Monsoon for irrigation.
  • Consumers of low priced and middle priced consumer goods
    • Maintains food security
    • Change has a multiplier effect in the economy
  • Agricultural production

Types of Crops

  • Kharif - Monsoon Crop from June to Oct/Nov - warm wet weather ex Cotton, Rice, Jowar, Bajara
  • Rabi from Oct to March - longer length of day ex Wheat, gram, sunflower
  • Zaid is Summer Crop - warm dry weather, longer weather Ex groundnuts, Watermelon, Pumpkins, Gourds
  • Cereals are cultivated grasses, Millets are types of Cereal grown in less important area where productivity and economics is less
  • Pulses are cultivated to enrich the soil and utilise the residual moisture
  • Forage crops are where entire vegetative part is used as green fodder
  • Jowar, Bajra, Mung are Rain fed crops. Chilli, sugarcane, Banana, Papaya etc are irrigated crops
  • Photoperiod is the sunlight time required for plants to flower

Millets

  • Millets are highly variable small seeded grasses aka cereal crops/grains. Can be white, green, yellow, red etc.
  • After green revolution production of Millets has drastically gone down.
  • Can be grown in harsh conditions due to its high resistance.
  • Do not get destroyed easily and provide cheap and high nutrient options Can be consumed even after 10-12 years of growing -> providing food security.
  • Has Mg, Vitamin B3 is gluten free and has high protein content.
  • Nutritionally superior to wheat and rice.
  • FAO has declared to observe International year of Millets in 2023. 2018 was national year of millets in india.
  • Ex are Ragi, Bajra, Jowar, Foxtail millet, Kodo millet etc.

Food Philosophy of India

  • First phase was the first 3 decades done to achieve physical food access for the population. Green revolution helped achieve it.
  • Second Phase was till 2000 there was enough food stock but still people were dying of hunger. There was a general lack of economic reach for the population and we are still struggling with this.
  • Third phase is moving towards organic food after knowing the ecological cost of green revolution.

Land Reforms

First Phase

  • Commenced just after Independence and had the objective of removing institutional discrepancies of agriculture ex size of landholdings, land ownership, land inheritance, tenancy reforms etc.
    • Other objectives to achieve socio-economic equality since land ownership was intertwined with caste system.
    • increasing agriculture production was the 3rd objective

Steps taken

  • Abolition of Intermediaries ex Zamindari, Mahalwari and Ryotwari..
  • Tenancy Reforms ie regulation of rent to be paid by share croppers to land owners, security of tenure to share cropper to secure his future income, ownership rights to tenants so that the landless can have access to land.
  • Reorganisation of agriculture
    • redistribution of land after passing the ceiling laws
    • consolidation of lands for Green revolution to succeed.
    • Cooperative farming
  • Reasons for failure : Land was considered symbol of social prestige, status and identity. Lack of political will and rampant corruption.

Second Phase

  • Started since the economic reforms and engaged in issues like land acquisition, leasing, food related issues and agricultural provisions of WTO.
    • the policy focused on mapping land and assigning title; Devising fair but speedy process of land acquisition;
    • transparent and effective land leasing policy.
  • Digital India Land Record scheme DILRMP is being run as central sector scheme to give out conclusive title for land rights.
  • Leasing has become a better choice for farmers, Corporate farming has not grown in India on a big scale. Thus giving primacy to leasing instead of transfering ownership seems to be the right way.
  • Certain steps taken in this direction was the Model land leasing law that was advised by NITI Aayog.
  • But concern is the rising cost of land acquisition.

Green Revolution

  • There was no social opposition to Green Revolution like the land reforms.
  • GR had more positive impact on the social economic life of people than the land reforms.
  • GR is new techniques of agriculture. Wheat was first crop, 2nd was rice.
  • Centered around the use of HYV seeds that was developed by Norman Borlaug.

Various components of it were :

  • Use of HYV seeds called dwarf variety, these seeds were non photosynthetic hence non dependent on sun rays for targeted yields.
  • It needed huge amount of nutrition and required use of excessive chemical fertilizers.
  • Required area for crop to be free from floods and articicial water supply was constantly needed.
  • Required chemical pesticides and germicides; herbicides and weedicides.
  • Availability of easier and cheaper credit was required to grow then in huge numbers and get adequate grain quantity.

Impacts

  • Socio economic impact was that many countries became self sufficient and rise of food exporting economies. But it also inc inequality among farmers.
  • Ecological impact was most severe. Soil fertility got degraded, water levels kept on falling, env degradation due to deforestation.
  • Toxi levels in food chain increased.

Cropping Patterns

  • Cropping pattern depends upon
    • Geographical factors such as Soil, Landforms, precipitation, moisture etc.
    • Socio Cultural factors ex food habits, festivals etc.
    • Infrastructural factors ex irrigation, transport, storage etc.
    • Economic factors like financial resource base, land ownership, size and type of land etc.
    • Technological factors ie improved variety of foods.
  • Rainfed agriculture accounts for 92.8 milliion hectare or 65% of cropped area.
  • Ratoon cropping : raising a crop with regrowth coming out of roots or stocks of harvested crops. Ex Sugarcane, Banana, Sorghum, Pineapple.
  • Examples of Intercropping Maize + Cowpea , Sorghum/Groundnut + Redgram, Potato/Wheat + Mustard.
  • In mixed cropping seeds are grown without row arrangement, drylands, seeds are mixed together and then sown, done for subsistence purposes.
  • Garden land farming is supplemental irrigation by lifting water from underground sources
  • Dryland : entirely dependent on rainfall
  • Mixed farming : farming with crop production, raising livestock, poultry, fishing, bee keeping. Capital intensive.
  • Specialised farming : 50% of income of total crop production comes from single crop, where no crop gives 50% total income called general/Diversified farming
  • Crop Rotation : Leguminous crop fixes N in soil should be grown before non-leguminous ones
  • Eco farming : maintenance of soil the way nature would do if left alone, feed the soil not the plant
  • Biodynamic farming : biologically organic and ecologically sound and sustainable farming
  • Organic farming: organic manures, nonchemical weed control, biological pest and disease control, mixed farming, crop rotation, organic cycle optimisation
  • Permaculture : design system for sustainable environment ex houses, technology etc #PrelimsPYQ
  • Integrated farming : cropping system, animal husbandry, fisheries etc together
  • Macronutrients required by plants are - N,P,K, S, Ca, Mg
    • Nitrogen : constituent of protein, chlorophyll.
    • Phosphorous : enzyme to fix light energy, K for carbon assimilation and transportation of photosynthates, water regulation,
    • Sulphur : part of amino acid builds protein
    • Ca : cell division, growth and enlargement, pollen growth
  • Some Micronutrients are : Fe, Zn, Vanadium Va, Ni, Si
  • Manures : enriches nutrients, aeration of soil, inc water holding capacity
    • Farm Yard Manure : cattle dung and urine, litter, fodder etc
    • Compost manure - well rotted organic matter
    • Oil cakes mostly rich in N, edible one for cattle and non-edible
    • Bone Meal - bones of animals rich in K
    • Fish meal - NPK
    • Green Manuring - ploughing the green plants to soil, Green Leaf Manuring
    • Biofertilizers - inc micro organisms
  • Nitrogen Fixers -

Nitrogen Fixers

  • Watershed Mgt : area of land and water bounded by drainage divide within which surface run off collects and flows through an outlet to a river
  • Terracing : reduces the length of hill slide or slope to reduce erosion and formation of gullies
  • Physical characteristics of the location where the soil is formed is called Topography
  • Components of Soil - clay, gravel, Loam(equal mixture of clay, sand, silt and humus), Sand, silt
  • Soil profile - vertical section of soil showing various layers(aka horizons)
  • Sodic soils have more Sodium, pH 8.5
    • Acidic soils ph 6.0, H+ and Al3+ predominant
    • pH 8.5 is called alkaline soil, regions with 25 inc rainfall
    • Alfisol - in forest or savanna vegetation.
    • Aridisol - found in desert
  • Podzolisation - caused due to excessive leaching of Calcium, are acidic
  • Laterisation - when dried become very hard, process removes silica
  • Gleization - sticky clay formation below the sub surface layer aka hydroorphic soils
  • Solonisation or Alkalisation is the accumulation of Sodium ions

Challenge in Agriculture :

  • A national agriculture market is missing mostly due to lack of political will among states to put up the right kind of APMC.
  • Need to promote corporate investment esp for farm mechanisation.
  • Labour reforms is hurdled by long tradition of complex labour laws.
  • R&D lacks; proper supply chain is missing
  • Need expansion in commodity trading in agri commodities.
  • Deceleration and achieve 4% growth rate.
  • Inadequate {productivity, growth}, high prices, lack of credit.
  • Crippling debt, uncertainty over weather, pests, lack of insurance.
  • Migration and rise of feminisation of agriculture.
  • Land fragmentation, negative terms of trade, marketing limitation.

Concerns

  • The pop dependent on agriculture has not declined.
  • Dec in average size of landholding - dec in productivity - not permits new tech due to high cost.
  • productivity declined.
  • More emphasis on subsidies rather than capital assets.

Need for Improvement

5 aspects of agriculture that needs immediate attention as per NITI A.
- Poor output per hectare mainly because of lack of tech
- No realization of remunerative prices due to limited reach of MSP
- Dec in farm size, problem of land leasing laws
- Inadequate relief during natural disasters
- Harness NE regions potential

  • Capital formation helps in :Sustainable production, Tech and Infra, ensure food security, makes it profitable

Areas Gov is Focusing to Improve Capital Formation

  • Focusing towards Horticulture cultivation
  • Agriculture marketing infra, restoration of water bodies
  • Micro {irrigation, finance, insurance}
  • Setting up Knowledge centre in every village, create new growth poles
  • PM Gram Sadak Yojana, Nutrient based fertilizer regime

Water Management and Irrigation :

  • Participatory Irrigation Management PIM ensures water equitability and ensures tail enders get their fair share
  • PIM are democratically organised association that collect water charges, collect etc.
  • Warabandi is fixing turns for each farmer.

Drought

  • Meteorological drought : actual rainfall in an areas is significantly less than climatological mean.
  • Hydrological drought : depletion of surface water causes low stream flow.
  • Agricultural drought : inadequate soil moisture and fall in agricultural productivity.
  • If 20-40% of India is affected it is called drought year, more than 40 is severe.

Rainfed Agriculture

  • Region where crop production is exclusively dependent upon rainfall.
  • mostly conc in arid and semi-arid areas, Account for more than 68% of sown area.
  • Dryland has rainfall 75cm and more than 30% under irrigation.
  • National Rainfed Area Authority NRAA :
    • To improve productivity of non-irrigated agricultural land, rural agri, water resources and environment
    • Build synergy, prepare plan

NDRF/SDRF - National/State Disaster Response Fund

  • States contribute 10% to SDRF rest the Centre
  • Allocation was recom by 14th Fin commission

Irrigation

  • Were classified by Planning Commission as Major Irrigation scheme covering cultivable area of more than 10,000 hectares; Medium Irrigation scheme b/w 2000-10000 hectares and Minor below 2000 hectare
  • The ultimate irrigation potential of India is about 140 million hectares and a substantial gap b/w Irrigation Potential Created and Irrigation Potential Utilised.
  • Irrigation efficiency : Older irrigation system has become univable due to shrotage of water, wastage of water and salination of soil.
    • Drip and Sprinkler irrigation can improve water use efficiency, reduce cost of production, can irrigate mroe area.
  • Programs launched to improve irrigation efficiency
    • Micro Irrigation Fund MIF - Under NABARD, 5000 cr allocation to boost farmers income
    • Long Term Irrigation Fund LTIF - under NABARD corpus of 20,000 cr
    • PM Krishy Sinchayee Yojana and Per Drop more Crop.
  • World Meteorological Organisation WMO

Static : Diff Types of Irrigation and Irrigation Systems Storage

2020-10-22 07:57:28


  • Irrigation is artificial application of water, assist growth
  • Well and Tube Well I -
    • In UP, Bihar, TN ex shallow wells, deep wells, tube wells, artesian
    • Advantages - cheap, easy to use, independent source, add fertility to soil
    • Demerits - limited areas can be irrigated, depletes ground water, not enough capacity
  • Canal Irrigation
    • In areas of low level relief, deep fertile soils, perennial, extensive command areas in UP, PUN, HAR
    • Inundation C - water mainly in rainy season vs Perennial
    • Merits : perennial, saves crops from droughts
    • Demerits : overflow during rainy, suitable for plains only
  • Tank - Ktaka, MP, Maha, Odisha, Kerala
    • Merits : natural, not costly, longer life span, fishing etc also carried
    • Demerits : drying up, lifting water and carrying to field requires cost
  • Drip : use drippers, low level, most efficient, practiced on large crops
    • M : Fertilizer, Nutrient loss is min, field levelling not necessary, reduced leaching, recycled non potable water can be used, water application efficiency increases, soil erosion, weed growth negligible
    • D : initial cost can be more, clogging, time, harvest, loss if not installed properly
  • Sprinkler : sprayed in air, suitable for uneven land, shallow soils
    • M : suitable for all types of soil, water saving, inc yield, saves land
    • D : Higher initial cost, efficiency dec in high wind high temp
  • Furrow - trenches are dug, difficulty is ensuring uniform dispersion, water loss
  • Surge Irrigation type of furrow, Ditch Irrigation
  • Sub Irrigation - water delivered from below soil, absorbed upwards
    • M : water and nutrient conservation, labour saving
    • D : outfitting cost is relatively high, inc presence of disease in recycle water

Accelerated Irrigation Benefit Programme:

  • launched to give loan assistance to the States for almost complete major/medium irrigation projects.
  • share is 2:1 for General Category States and Special Category States, it is 3:1
  • also be extended to minor surface irrigation projects of special category states
  • It has now been subsumed under PM Krishi Sinchai Yojana

Soil

  • Soil Health : Soil Health Cards, Organic fertilizers, nutrient based fertilizer subsidy
  • Soil Reclamation :
    • Through watershed dev
    • Saline and sodic land needs treatment
    • Acidic land needs treatment using waste from industry
    • Sulphur deficiency, organic matter def, inadequate manuring and composting
  • ZBNF -

Agricultural Extension

  • is application of scientific research and new knowledge
  • Krishi Vigyan Kendras by ICAR
  • Institute Village Linkage Program IVLP by ICAR
  • Start-up training
  • Agribusiness centre provides paid services
  • Small Farmers Agribusiness Consortium SFAC - provides risk capital

Rural and Agricultural Credit :

Agri Credit : Helps farmers to enhance productivity through investments in machinery, HVY seeds etc.
Concerns regarding it :

  • informal sources of credit is predominant can be curbed by DBT to replace interest subvention.
  • Ratio of agri credi / Agri GDP has increase but share of long term credit has declined this needs to reversed.
  • Regional disparity in distribution of agri credit esp in NE.

NABARD

  • Refinancing, supplementing resources of co-operative banks, RRBs
  • Certain supervisory functions over co-op and RRBs
  • Funds that are operated by NABARD are National Adaptation Fund for Climate Change NAFCC.
  • Rural Infrastructure Development Fund RIDF to finance ongoing rural infrastructure projects under irrigation sector.
  • Tribal Development Fund TDF to promote sustainable agriculture, social empowerment, improvement in quality of life including health and women dev in tribal area.

Co-operative Banks

  • Short term credit structure is managed by State Co-op Banks SCBs, District Central Co-op Banks DCCBs, Primary Agri Credit Societies PACSs
  • Long term managed by State Co-op and Agri Rural Dev Banks SCARDBs and Primary CARDBs

RRBs - ownership Centre 50% State 15 and Sponsor Commercial Bank 35

Local Area Banks

  • For rural and semi-rural areas
  • Min paid up capital Rs 5 crore, promoters contribution 2cr
  • Max 3 contiguous district as area of operation

Microfinance

  • SHGs play a dominant role here

Malegam #Committee

  • Charge 24% interest on loans less than Rs 25,000
  • Create separate NBFC - Micro Finance Company
  • 75% loans for income generation purposes
  • National Mission on Food Processing - gives greater role to states and Uts
    • Kisan Credit Card (KCC) #Scheme recom of V Gupta Committee, implemented by banks, covers risk against death/ permanent disability

Precision Agriculture

  • site specific crop management or satellite farming.
  • 3rd wave of modern Agricultural Revolution.
  • 1st wave will increased mechanisation, 2nd will be use machine data for precise planting.
  • Aims to optimize crop science, environmental protection, economics.

Animal Rearing

  • Supplements family income particularly the landless labourers, provides cheap nutritional food, insurance against drought, famines and promotes sustainable agriculture.
  • Has higher growth rate than 4.5% than farm sector, contributes 29% to agri.
  • Dairy farming, pig farming and animal health are some of its dimensions.

Food Management

MSP

Pasted image 20220421131919.png

  • guaranteed min floor price, support farmer from excess fall in prices, distress sales, on 7 cereals, 5 pulses, 8 oilseeds, Cash crops like raw cotton, Copra, Raw Jute, Virginia flu
  • Done to incentivise farmers to adopt HYV, combat food scarcity, price fluctuations
  • CACP decides prices on factors like
    • Cost of production
    • Input price
    • Market price
    • Demand Supply
    • Cost of Living
    • price level/inflation in India
    • internationals prices and domestic prices
    • area under crop
    • Yield, productivity
    • Issue price
    • Subsidies impact
    • Inter crop price parity
    • terms of trade b/w agriculture and non agriculture
    • min 50% as margin over cost of production
    • Implication of MSP on consumers of that product.
  • MSP is at least 1.5 times the cost of production incurred by the farmers. It is fixed twice a year on recom of CACP.
  • A2 + FL and C2 costs are considered.
    • A2 covers all paid out expense in cash and kind incurred by farmers on seeds, fertilisers, chemicals, hired labour, fuel and irrigation etc.
    • FL includes value of unpaid family Labour
    • C2 costs account for rentals and interest paid on owned land and fixed capital assets.

Advantages

  • IN emerged grain surplus country
  • food security achieved at National Level
  • Inc in productoin of grains
  • food prices remained stable
  • inc in farm income
  • economic transformation in well irrigated areas

Drawbacks

  • biased towards Wheat
  • Rice; change in consumption pattern
  • more production of Wheat Rice Diversion of resources from crops like pulses, oilseeds etc
  • inc in public stockholding etc

Present scenario/Issues

  • no mechanism on ground to ensure farmers are paid MSP
  • implementation of CACP prices
  • change in criteria for calculating prices
  • should include demand side factors
  • distorted MSP - inefficiency in system

Other issues

  • fixing MSP for political reasons
  • low level of MSP causes agrarian crisis and farmer distress
  • lack of viability in agri, small land holding size, low productivity,
  • inc production cost, shrinking employment, declining growth rate

Solutions

  • Land reforms, Access to irrigation, inc productivity,
  • insurance coverage, public investment in agri, education and skill dev,
  • promotion of rural non-farm sector,
  • setting up of village labour intensive industries,
  • providing institutional credit

Alternative

  • Deficiency payment scheme ex PDPS,
  • ensure no resale of product takes place

Recom of Swaminathan #committee

  • changes in irrigation, productivity, credit, insurance,
  • food security, bio resources, public investment in agri
  • human dev, rural no farm

  • Announced at the beginning of sowing season for Kharif and Rabi on the recom of Commission for Agri Cost and Prices CACP
  • 24 major agri commodities, farmers sell to FCI.
  • Procurement price during harvesting takes inflation into account.
  • It takes into account
    • Cost of production, Price parity,
    • changes in Input prices, demand and supply.
  • Criticism
    • Need diversification from Rice and Wheat
    • Helps big farmers, subsidy burden increasing
    • Changing food habits towards protein
  • MS Swaminathan #committee headed the National commission on Farmers.
Market Intervention Scheme
  • Market Intervention Price Scheme(MIPS) #scheme price support mech implemented on request of State gov, procurement of perishable and horticultural products during 10% fall in prices or 10% inc in production

  • Similar to MSP

Issue Price : Price at which FCI sells its foodgrains they are kept lower than the procurement price and the difference b/w them is called the food subsidy.

Economic cost of foodgrains :

  • Includes MSP, Procurement Incidentals and cost of distribution.
  • It has inc steadily with the rise in MSP.
  • Shanta Kumar #committee was set up to suggest restructuring or unbundling of FBI.

Open Market Sale Scheme OMSS

  • selling in open market not to TPDS. To enhance market supply, to exercise moderating influence on market prices and offload surplus stocks.
  • Price at which it is sold is called at Reserve price which is kept above MSP but below the economic cost of foodgrain to attract buyers.

Price Stabilisation Fund

  • launched in 2015 as a central sector scheme to support onion and potato
  • market intervention takes place and cost is borne by centre and state equally

Buffer Stock

  • Reserve commodity to offset price fluctuation and unforseen emergencies.
  • Done to meet minimum stock norms for food subsidy, monthly release of foodgrains through TPDS, meeting emergency, market intervention for price stabilisation.
  • 4 months requirement under TPDS and Other Welfare Scheme are earmarked as operational stocks the surplus over it is the Buffer stock.
  • This idea of Buffer stock was removed in 2015 and now anything over 4 mnths is treated as excess stock.

Storage

  • Food agencies do not have proper storage for even half of wheat and rice.
  • No effective strategy to control inflation of perishables
  • Low capacity of Cold storage
  • Need to construct godowns implemented in PPP scheme, Construct steel silos in PPP mode, Online Depot Mgt system to improve functional efficiency.

Subsidy

  • Subsidy = Price paid by farmers for key inputs - Actual retail market price
  • It is of 2 types Direct farm subsidies and Indirect farm subsidies. Direct ones are being paid to make their product more competitive in the global market.
  • Indirect are given in form of cheaper credit facilities, farm loan waivers, reduction in irrigation and electricity bills etc. India spends 2% of GDP on it, Fertiliser accounts for 2/3rd of it.
  • 2 ways it is done is by providing MSP like remunerative prices, other is supplying input at lower cost ex electricity, irrigation water, credit, fertiliser
  • Positive Impact
    • stimulate dev, promote risk taking,
    • encourage to use new inputs/ advance tech,
    • keep farmers at par w/ non farming communities,
    • providing food and nutritional security, inc access to poor farmers
  • Negative Impact - fiscal imbalance, wastage of resources, creates trade distortions, leads to environmental degradation, benefits mostly rich farmers, inc in stockpile of grains, changes consumption pattern

Types of Subsidies

  • Fertiliser - by C gov, make fertilizer available to farmers, ensure fair returns on investment, Retention price scheme, Retention price - Maximum Selling price = Fertiliser Subsidy, Nutrient Based Subsidy Scheme, Neem Coated Urea Policy, New Urea Policy
  • Irrigation/ Wateron usage of ground water, by providing canals, dams, low/no prices for their use
  • Seeds - distributing seeds at lower price
  • Power - to draw groundwater, to private parties, diff b/w price paid by farmers for usage of electricity and actual cost of generating electricity
  • Infra - roads, storage, power, info, transport
  • Credit - diff b/w interest charged from farmers and actual cost of providing credit

Food Security

  • It means making food available at affordable prices at all times to everyone.
  • As per FAO report 14.5% of population is under nourished, 51% women b/w 15-49 are aneamic, 40% children under 5 are stunted.
  • India is ranked below Pakistan, Nepal at 102 in Global hunder Index.
  • Challenges are high population under BPL having high expenditure on food; Volatility in agricultural food production.
  • Need to enhance food production and strengthen supply chain.

Agriculture Marketing

  • APMC Act enacted by the state govts regulate agrimarkets in India.
  • Act notifies agricultural commodities produced in region such as cereals, pulses, edible oilseed, fruits, chicken, goat, sheep, sugar etc.
  • Such markets have places for auctions, weigh bridges, godowns, shops for retailers, canteens, roads etc.
  • Major issues are :
    • charging market fees from buyers and licensing fees from intermediaries.
    • comission fees for agents which is very high and is charged on the entire value of the produce sold.
    • high taxes at first level of trading has significant cascadin effects on commodity price.
    • APMC is an arm of the state and market fees are taxes and has very little scope for price discovery
    • Its operations are independent of scrutiny
    • important positions at market committees and market board are held by politically influential people which makes them prone to corruption.

Model APMC Act 2003

  • It provides for direct sale of farm produce by farmer
  • Setting up special markets for specified agri commodities esp perishables.
  • private markets can be established
  • single levy of market fee; licenses replaced with registrations.
  • Creation of marketing infra from revenue earned by APMC etc

Model Contract Farming Act

  • Contract farming outside ambit of APMC act.
  • Covers all services contracts related to pre production, post production.
  • No permanent structure on farmers land.
  • settiling of disputes in an accessible and simple mechanism.

Agri Commodity Trading

  • aimed at stabilising prices by maket based price discovery. It is market oriented price determination.
  • Stable prices benefit sellers, price volatilities are minimised.
  • Stock variations due to export and import are minimised.
  • National Commodity and Derivatives Exchange NCDEX, National Multi Commodity Exchange NMCE etc are some exchange markets.
  • Biggest challenges are storage, logistics and financing.

Upstream, Downstream, Midstream

Upstream : Upstream stage of production process involves searching and extracting raw materials. No value addition on raw material takes place.

Downstream : Involves processing of materials collected during upstream process to turn it into a finished product. It includes actual sale and has direct contact with customers through finished products.

Midstream : depends on points of reference for a manufacturer considers suppliers as upstream and customers as downstream.

Bottlenecks in upstream and downstream in India :

  • Retail trading(downstream) is fragmented in India -> uncertainities, in monitoring and regulation.
  • Outsourcing of raw material from local producer is difficult. Due to this upstream segment has remained weak.
  • For manufacturing sector heavy dependence on unorganised sector is a challenge.

Supply Chain Management

  • Supply chain is a network between a company and its suppliers to produce and distribute a specific product to the final buyer. It is done to reduce their costs and remain competitive in the market.
  • It covers Product developement, sourcing, production, logistics, information systems.

FDI in upstream, downstream, supply chain management to get international experience and best practices. Will lead to an organised retail sector, proper levels of logistics etc.

Other Concepts

Farm Mechanisation : to reduce drudgery, save time and labour, inc productivity, minimise wastage.
- India has more rural-urban migration, shift from agri to services etc
- high proportion of female workforce it will enhance their safety and comfort.
- quick rotation of crops will inc yields.
- small holdings, access to power, credit cost and procedures, uninsured markets etc are reasons for low farm mechanisation.

Seed Development : Quality of seed account for 20-25% of productivity
Challenges to adoption of quality seeds are :
- Inadequate research inputs
- Early ripening and resistant varieties
- High cost of seeds
- shortage in supply of quality seeds
Affordability, Availability, R&D, GM crops and seeds require immediate attention.

Feritiliser :

Need now is for

  • crop responsive and balanced use of Fertilisers depending on soil health and fertility
  • fert need micro nutrients to inc yields since Indian soils lack micro-nutrients ex by using organic fert.
  • Nutrient mgt through judicious use, using IT etc to improe testing.
  • Bridging gap b/w regional disparity

Various Gov schemes targeting this are :

  • DBT for fertiliser subsidies which are disbursed on basis of actual sales made by retailers to beneficiaries.
  • New Urea Policy to maximise indigenous urea production, promote energy efficiency etc.
  • P, K fertilisers have nutrient based subsidy NBS scheme under which fixed subsidy is given based on content

Pesticide : India uses very low amt of 0.5kg per ha of pesticide. Major challenges are use w/o proper guidelines, using sub standard pesticide, lack of awareness about pesticide use.

Agricultural Extension services : aims at providing timely advisory services to farmers to adopt best practices, tech etc.
These services are not efficient due to

  • lack of functional autonomy
  • rigid hierachical structure and
  • lack of innovation and coordination failures.
    Steps for improvement :
  • Implementing new scheme or additonal outlays in existing schemes
  • One stop shop for both software and hardware needs
  • value added activities in the farm
  • minimise wastage in input and produce.
    Govt steps are
  • Kisan TV
  • Agri Clinic and Agri Business
  • National Center for Mgt of Agricultural Extension
  • Ekta Portal etc

Climate Smart Agriculture : transform agri food system towards green and climate resilient practices. CSA supports reaching towards SDG goals and Paris Agreement.

  • It aims to sustainable increase agricultural productivity and incomes
  • adapting and building resilience to climate change
  • reducing and/or removing greenhouse gas emissions.

Static - Food Processing and Related Industries - Scope, Significance, Location, Upstream, downstream Requirements, Supply Chain Management

2020-10-22 08:00:43


  • It refers to various techniques and operations by which raw foodstuffs are transformed into food that are suitable for consumptions, cooking or storage.
  • FPI have strong base in India due to abundant production of food articles, aromatic and medicinal plants.
  • Constitutes about 8.83% GVA in Manufacturing and 10.66% GVA in Agriculture sector.
    • Indias share in export of processed food globally is 2.31%.

Challenges with Food Processing in India and the world :
- Lower urban population of India and does not have urban food habits.
- recently there has been enough awareness regarding harmful chemical used in the country
- A move to vegan culture has decreased processed food market

Importance of Food processing
- FP aims to make food more digestible, nutritious and extend the shelf life.
- Covers all the aspect that food items go through farm to the consumers plate ex cleaning, grading and packaging.
- Can create sustainable livelihoods and economic development for rural communities.
- Farmers, Consumers and Economy all 3 benefit from it.
- It increases opportunities in allied sectors such as supply chain management, cold storage, financing etc.

Rules and Regulation
- most FP enterprises do not require licenses except alcoholic drinks.
- 100% FDI through automatic route.
- Automatic FDI for reserved items to be manufactured by MSE's upto 24%/

  • FP is transforming raw ingredients into food long shelf life, conc mostly in coastal areas
  • 2 processes In FPI Raw material - Food (Primary)and Value addition (Jams Squashes)
  • Importance - link b/w agri and industries, absorbs major share of workers from agri, prevents wastage, processed food requires less space/storage, can be exported
  • Adv - Resource advantage, increasing employment, curbing migration, curb food inflation, crop diversification, demand potential, driver of growth
  • Upstream stage - involves searching and extracting RM
    • Requirements - Accessibility to RM, Modern extraction, good linkages w/ farmers, Storage facilities , quality testing facilities, transport facilities, work force
  • Downstream - processing of materials collected
    • Requirements - latest processing techniques, processing machinery, quality testing facility, Org retail stores, Work force
  • Supply Chain Mgt Supply Chain Management
    Challenges :
    • are small, lack good R&D,
    • lack of skilled workforce,
    • lack of right vision and support from Gov,
    • lack of good transportation,
    • lack of organised retail,
    • limitation in supply chain,
    • limitation in quality, lack of modern regulation

Various govt institutions that have been established are
- Indian Institute of Crop processing Technology IICPT
- National Meat and Poultry Processing Board NMPPB
- Indian Grape Processing Board
- National Institute of Food Technology, Entrepreneurship and Management

Mo Food Processing

2020-06-11 19:29:16


Pradhan Mantri Kisan Sampada Yojana is a Central Sector Scheme to supplement agriculture, modernize processing and decrease Agricultural waste.
- will be implemented in 2016-20 Following schemes will be implemented under it :
- Mega Food Parks
- Integrated Cold Chain and Value Addition Infrastructure
- Infrastructure for Agro-processing Clusters etc

Operation Greens : objective of the project is to reduce price volatility in Tomato, Potato and Onion and to ensure their availability round the year.
- Rs 500 crores to promote FPOs, Agri logistics, processing facilities etc.
- NAFED is the nodal agency

Mega Food Parks based on "Cluster" approach envisages a well-defined processing zone containing state-of-the art processing facilities.

  • In General areas - One-time capital grant of 50% of the project cost upto a max of 50cr
  • In Hilly & Difficult terrain - Capital grant of 75% of the project max 50 cr.

Mega Food Park Model: An Illustration I PPC PPC Mega Food Park CPC Grgdng pun Aseptic pโ€ขcking. lab,

Trade trends in Coffee, Fresh fruits, Sugar and Spices.
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Prelims PYQ

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