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Special zones to double Indian agro-food exports

Fakir Chand in Bangalore

The Center and various state governments appear to have finally woken up to compete against each other in setting up agri-export zones across the country to double export of food grains and agro products, including flowers, fruits and vegetables, fresh as well as processed.

Though India has been touted to be one of the largest producers of food grains and agro/dairy products, besides meat and poultry items, there has been a virtual complacency in tapping their export potential as the focus over the decades has been inward-looking for catering to the ever-growing domestic market, thanks to the booming population.

Nevertheless, cycles of excess production and shortages have put paid to the efforts of the intermediaries in evolving a long-term outbound strategy for stepping up India's share of global market, which presently hovers around an abysmal 1-2 per cent.

Absence of key intermediaries such as cold-chains, processing centers, modern technology and machinery, speedy financial aid and incentives, and inadequate infrastructure-cum-logistic support have discouraged Indian farmers to become pro-active for tapping the export markets, leading to enormous wastage of the most perishable goods.

In a bid to turn the fortunes of millions of Indian farmers and various intermediaries, including exporters, packagers, and logistic agencies, the Union government has formulated a national strategy to set up about 40 dedicated AEZs in different states for vertical markets ranging from food grains to fruits, vegetables, flowers, liquor and vanilla products.

"The game plan is to double Indian agro-food exports to Rs 200 billion by the end of the 10th Five-Year Plan (2002-2007) by addressing new markets with innovating strategies so that farmers need not depend only on domestic market for greater returns and move up the value chain," Agricultural and Processed Food Products' Export Development Authority chairman Anil Swarup told rediff.com in Bangalore on Monday.

Qualifying the potential of Indian food grains and fruits, Swarup disclosed how the setting up of a special zone for export of mangoes at Mangalore on coastal Karnataka this summer has led to a realization of Rs 800-900 million in dollar terms by Indian exporters.

"The demand for high-quality Indian mangoes such as Alphonso, Kesar, Daseri and Begumpalli is very rewarding in European and South East Asian markets. We have made a modest beginning by participating in international fruit trade/export fairs by showcasing select items like mangoes, grapes, and leechies.

Excellent response in key markets like London and Frankfurt in Europe has encouraged more states like Maharashtra, Uttar Pradesh, Gujarat, and Andhra Pradesh to join Karnataka in setting up similar AEZs for exporting these fruits and their processed products like pulp, jelly, pickles, and other value-added products," Swarup stated.

In the case of basmati rice, Apeda has roped in Punjab, Haryana, Uttar Pradesh, and Madhya Pradesh to set up exclusive export zones in association with Apeda so that farmers could take advantage of their various facilities such as timely loans from banks and co-operatives at 8 per cent interest, extension services for selection of seeds, fertilizers, pre- and post-harvesting techniques, processing, and packaging.

"Export of Indian basmati rice to European and US markets has been phenomenal as it has registered a growth rate of 20 per cent in fiscal year 2001-02, and poised to double (40 per cent) during the current fiscal (2002-03).

The growing presence of Indian Diaspora in various Gulf countries, Europe, and the US has led to quantum jump in demand for the aromatic and nutritious basmati rice.

Flair for Indian curry and cuisine such as biryani in the western restaurants has given momentum to its exports in spite of stiff competition from the Pakistani variety," Swarup claimed.

To double the agro-food exports from the current Rs 100 billion, India will have to maintain an cumulative average growth rage of around 15 per cent during the 10th plan period as against the current growth rate of 5-6 per cent.

An export growth rate of about 20 per cent in the first two months of the current fiscal year (2002-03) against a dismal 5.9 per cent growth registered during the last fiscal year (2001-03) in agro food products signals a remarkable revival in a globally competitive environment.

During the current fiscal year, Apeda will be setting up about 20 AEZs in different states ranging from West Bengal to Gujarat and from Punjab to Tamil Nadu for export of various agro food products such as potatoes, onions, fruits, meat and poultry products and pulses.

Riding on the success of AEZ for gherkins from Karnataka, Apeda has joined hands with the state government to set up two more AEZs for export of flowers and rose onions from Bangalore.

Keeping in view the contiguous nature of the area for developing and sourcing raw materials, besides processing and packaging, Apeda has chosen Bangalore for these two products, for which the region is famous for and where export demand is growing at a faster rate.

By identifying the potential products and the geographical region where they are grown, these zones adopt end-to-end approach of integrating the complete process right from production to export stage. Contract farming is also being encouraged to rope in local farmers for joining the export zone as members to pool in their produce.

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