Karnataka Govt Plans Farm Market Intervention
The Karnataka government intends to intervene in the food market to regulate the falling prices of vegetables and fruits in a bid to rescue farmers from distress sales.
State agriculture minister C Byre Gowda said: We are considering implementing the market intervention scheme to help the farmer get the floor price for his produce.
This scheme, which will be brought into effect soon, will be jointly sponsored by the Centre and the state. Designated organisations such as NAFED and MARKFED would be involved in the effort. The plan is to buy out the farmers produce at a basic price and hawk them in the open market.
Gowda said even though there is a shortfall in production, the prices of food commodities, excepting arecanut and coffee, were sliding.
At a seminar on a GMCI workshop on the problems and prospects of food processing industries here yesterday, Gowda used the forum to launch an attack on liberalisation. Has liberalisation helped the farmer? There has been a steep fall in agricultural prices which is unwarranted in the first place. I have great doubts about liberalisation which allows foreign TVs and refrigerators to come into the country.
Gowda then went on to warn the industry of the governments inability to provide power. We cannot do anything on the power generation front for another four years, he said, but was willing to extend other facilities like lowered interest rates and simplified tax procedures and collection for the food processing industry.
He said the government was trying to plug the missing links in the system such as setting up a Rs 66 crore cold chain, amending the Land Reforms Act and clearing projects at record time. But the industry is not coming forward in a big way, he said.
H L Somany, president of Associated Chambers of Commerce & Industry (Assocham), said that the food processing industry continued to be controlled by the government through legislations and controls despite liberalisation. The country needed to harmonise its food laws and scrap duties on food production and packaging, he suggested.
R P Aggarwal, president of GMCI, reeled off statistics on the food processing industry, claiming that though they were the second largest producer of fruits and vegetables in the world, a mere 1.4 per cent was processed.
Indias share in the global trade of these items was hardly 1 per cent compared with Vietnam and Philippines, which processes 35 per cent and 39 per cent, respectively, of their production.
Food processing has been identified as a thrust area in the state industrial policy. Foreign investment worth Rs 46 crore has been approved for this sector in Karnataka. Aggarwal said poor infrastructure, low technology farming methods, high post harvest wastage and hurdles like the Essential Commodities Act were major stumbling blocks in this sunrise industry.