Guj govt proposes incentives for agri R&D

AGRI BIZ POLICY - PART III

New Agri Policy emphasises research and development in farm sector.

Considering the non-existence of research and development (R&D) in agriculture sector, Gujarat government's new Agri Business Policy proposes to provide slew of incentives to augment R&D in the sector.

As a result of the good agriculture practices, the farm production in Gujarat has surged from Rs. 9,000 crore in 2001-02 to Rs. 34,000 crore in 2006-07. However, the state government believes that there is a lack of primary value addition and post-harvest infrastructure at farms.

Also, the research and development activities are almost non-existent. Acknowledging this fact, the state government wants to give a major thrust to R&D in agriculture sector, said senior government officials.

The soon to be announced new Agri Business Policy-2008 may offer 50 per cent cost of sponsored R&D project with a ceiling of of Rs. 20 lakh. For enhancing value addition, the new policy is likely to give 25 per cent credit-linked subsidy to farm gate value addition project. A maximum of Rs. 12.5 lakh subsidy would be offer under the new agri-business policy.

The primary draft of the said policy also proposes 6 per cent interest reimbursement on term loans for such projects. The estimated cost of the projects has been pegged at Rs. 50 lakh.

The draft policy also seeks to promote creation of value chain for farm products. The state government is likely to offer 50 per cent cost of the crop certification (lab analysis, training and certification fee) with a ceiling of Rs. 5 lakh per crop. Maximum of 3 crops per year would be eligible for this incentive.

Apart from this, 100 per cent APMC cess is to be provided as incentives for certified crops for certified crops under contract farming. The new agri policy will also promote adoptability of variety for fresh and processing industry.

The focus on value addition and processing assumes importance as agri produces worth Rs. 6,000 crore is wasted every year due to lack of post harvest infrastructure.

The state government in its annual budget for 2008-09 has also proposed to provide an amount of Rs. 3.16 crore for pre and post harvest training and other extension activities, which includes a platform for interaction with scientists and experts.

Presently, supply chain, agriculture inputs, finance, market and extension are fragmented. So to meet the one stop solution, the state government believes that an Agribusiness Hub is required through public private partnership.