Govt Should Formulate A Stable Agri Policy: Expert

In order to commercialise and diversify agriculture and make it competitive for overall economic growth, the government needs to put in place a stable and transparent import-export policy with regular monitoring of international demand, supply and price situations, a senior official in the Commission for Agricultural Costs and Prices (CACP) said.

"The growth of agri-business is determined by the trends and patterns of demand and supply of agricultural commodities such as accessibility to desired commodities through necessary market, infrastructures and price behaviour in national and international markets as well as export-import policy. Even for the necessary technological change and development of infrastructure and institutions, the role of the government is very important," T Haque, member of CACP said at a seminar.

 

Citing the example of pasta products, he said "although the demand for pasta products is rising due to urbanisation, there are no pasta machinery manufacturers and adequate packaging materials."

This is because the high import tax on capital equipment discourages investments and modernisation, Haque stated.

Moreover, he added that although deservation of rice milling industry should attract the big players to improve technology and quality of rice available to food processing industry, currently while some rice mills were modern, others were traditional shellers or huller cum shellers.

This is because the policies of local taxes and levies discourage the growth of private trade. "To modernise the rice mills, the system of compulsory levy on rice mills should be done away with," the CACP member added.

The recent import policy of the government has affected the growth of oilseed production and processing in the country, he said adding "the supply is very tight and although import of oilseeds is allowed from 1998, QRs and poor state infrastructure prevent large scale import of oilseeds which leads to under-utilisation of capacity in the oil processing industry."

Asking for review and strengthening of the concept of agro-climatic regional planning, quality control measures and marketing infrastructure, Haque said, "lack of agro-climatic regional planning for production of agricultural commodities in cost effective and competitive manner and non-availability of quality raw materials and inadequate marketing network are the major constraints to poor post harvesting of horticultural produce."

Poor harvesting techniques and inadequate post harvest infrastructure has led to damage and wastage of raw produce. The post harvest losses of horticultural produce are reported to be as high as 37 per cent, while only two per cent of the produce is processed.

Hurdles like lack of cold storage, refrigerated vans and high transportation costs add to marketing inefficiency and prevent the movement and business of poultry and livestock products.

Saying that huge procurement of grains by the government agencies has reduced the scope of private trade in foodgrain marketing, Haque stated "FCI's dominance over grain markets should be reduced with appropriate policies for pricing, procurement and disposal of grains."