Developing Horticulture sector in India

Subodh Agarwal

The horticulture sector encompasses a wide range of crops e.g., fruit crops, vegetable crops, potato and tuber crops, ornamental crops, medicinal and aromatic crops, spices and plantation crops. India, with its wide variability of climate and soil, is highly favourable for growing a large number of horticultural crops. It is the fastest growing sector within agriculture. It contributes in poverty alleviation, nutritional security and have ample scope for farmers to increase their income and helpful in sustaining large number of agro-based industries which generate huge employment opportunities. Presently horticulture contributes 28 per cent of agricultural GDP. The national goal of achieving 4.0 per cent growth in agriculture can be achieved through major contribution from horticulture growth.

Current Scenario

After the Green Revolution in mid-sixties, it became clear that horticulture, for which the Indian topography and agro climate are well suited, is the best option. India has emerged as the largest producer of mango, banana and cashew and second largest producer of fruits & vegetables in the world.

The most significant development that happened in the last decade is that horticulture has moved from rural confines to commercial production and this changing scenario has encouraged private sector investment in production system management. The last decade has seen technological infusion like micro-irrigation, precision farming, greenhouse cultivation, and improved post harvest management impacting the development, but during the process various issues have emerged.

Role of Banks in development of this sector:

Institutional finance has a prominent role to play to meet the fund requirement for strengthening the supply base of horticulture and plantation sector. The credit requirement under this sector during the X plan period has been assessed as Rs.18, 420 crore. In order to meet this target, banks have been asked to give special focus to horticulture through increasing investment in this sector.

Commercial banks have devised strategies to boost their advances under horticulture either through direct lending or by tie up arrangements with SHGs, NGOs, Corporates etc. which has stimulated the farmers to undertake horticultural activities. Schemes with relaxed norms particularly for small and marginal farmers are available with all the leading banks for increasing both the production as well as infrastructure development

CONSTRAINTS IN DEVELOPMENT OF HORTICULTURE

Inadequate Post Harvest Infrastructure and Processing Facilities

Poor Marketing Infrastructure

High Investments and Long Gestation Period

Post Harvest Losses

Trading and Marketing bottlenecks

Sale of the Produce by Small and Marginal Farmers

Market Distortions

Banking Facilities

Market Intelligence

Exploitation by Commission Agents/Traders

POLICY ENVIRONMENT FOR HORTICULTURAL DEVELOPMENT

The development of the horticultural sector is supported by a large number of institutions both at the central and state level. The National Horticulture Board (NHB) in the ministry of agriculture is the central institution responsible for facilitating the development of this sector. Its mandate includes (a) encouraging the development of commercial horticulture through demonstration farms; (b) developing post harvest management infrastructure; (c) strengthening market information systems and maintaining horticultural database; (d) assisting R&D programme; and (e) providing training and education to farmers and the processing industry for improving agronomic practices and adoption of new technologies.

The horticultural sector has received considerable attention in recent years as it is recognised as a potentially important source of growth, employment generation and foreign exchange earning. The emphasis being given to this sector is reflected by establishing National Horticulture Mission in 2004 with an overall objective to enhance production of horticultural crops by 2011-12. The specific objectives of National Horticulture Mission are: (a) doubling horticultural production to 300 million tonnes by 2011-12; (b) establish convergence and synergy among various on-going and planned programme in the field of horticultural development; and (c) promote the development and dissemination of technologies by blending traditional wisdom and frontier knowledge. The priority areas under the mission include horticultural research and development, improving post harvest management and promoting processing and marketing of horticultural crops. The special attention is devoted to the promotion of horticultural export through establishment of focal Agricultural Export Zones (AEZs).

Some of the main reforms are: (1) removal of licensing requirements and government control over cold storage fees; (2) amendments of APMC Acts to allow contract farming, private sector investments in wholesale markets and direct marketing between buyers and sellers; (3) approval of foreign direct investment (FDI) in food processing and marketing with the exception of retail marketing; (4) removal/relaxation of quantitative restrictions on import and export of food items (except items on the negative list)and capital goods; (5) abolition of minimum export price (MEPs); and (6) tax reform including the adoption of VAT to replace purchase and sales taxes in several states.

Authors:
Subodh Agarwal
Asstt. Professor(agribusiness)
CCS-HAU, Hisar
Email: subodh.agarwal47@gmail.com