New investments in agro-processing may raise farm incomes in Punjab

Punjab's food processing industry--in doldrums for many years due to sundry reasons-- might have a reason to rejoice, as corporate players signed MoUs worth Rs 4,881.99 cr during the ‘Progressive Punjab Summit’ held in Mohali on 9 December to 10 December.

How many of these proposals would actually hit the ground remains to be seen but the changing landscape of agriculture in Punjab due to dwindling water table and fragmentation of landholdings calls for private participation to raise the farm income.

Major corporate players like ITC, Mahindra and Cargill have proposed to make investments in the agro-based industries to the tune of Rs 680 cr, Rs 118 cr and 70 cr respectively. Container Corporation of India and United Liner Agency may come up with logistic parks and cargo terminal in the state.

The availability of plenty of agri and dairy products has always been a big advantage for agro based industry in Punjab but in the past few years the real estate became the cynosure of investors.

The New Industrial Policy announced by the Punjab Government in June and notified in December this year rolled out a red carpet for the manufacturing and food processing sector and investors across India have proposed to invest.

Out of the proposed investments in agro-processing sector, approximate 2,400 cr have been envisaged for food parks and logistic centres besides, rice processing, potato processing, meat processing, milk processing and state-of-the-art abattoir.

Talking to Business Sandard, the Managing Director of Punjab Agro Industries, K S Pannu said that the incentives offered in the New Industrial Policy that includes plethora of concessions and exemptions under various categories helped to mobilise the remarkable response.

He added that some of the companies were in the process of preparing DPRs (detailed project reports) as they want to execute their project at the earliest. For the bigger projects, it may take some time as they have to acquire land and put substantial plant and machinery, he said.

The government of Punjab is committed to acquire 10,000 acre of land to facilitate the new industries and a part of this would be earmarked for the food-processing sector. "Saastha Warehousing Limited has already acquired 200 acre of land to set up Mega Food Park", he apprised.

According to Gurmail Singh, a farmer near Chamkor Sahib in district Ropar in Punjab "Soil fertility has been effected in Punjab due to consistent wheat-paddy rotation. The foray of new project based on agri-products will provide new opportunities to farmers, who are ready to diversify if provided forward linkages."

The falling marginal incomes in agriculture in Punjab due to lack of infrastructure and market linkages for agriculture produce and stagnant opportunities in food processing sector persuaded many farmers to sell their land to real estate developers ans became landless farmers.

The timely exceution of the proposed investments in agro-processing may revive the agriculture and allied scetor in Punjab providing a remunerative livelihood to the farmers.