Indian Agriculture & Agri-Business Management

Transcription

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2 Indian Agriculture & Agri-Business Management

3 ABOUT THE AUTHOR Dr. Smita S. Diwase M.Sc (Agriculture), MMS, Ph.D Smita Diwase has done her Masters in Agricultural Meteorology and her Ph.D in Management. She is the recipient of several scholarships and awards including the Indian Council of Agricultural Research (ICAR) Fellowship She has over twenty years of work experience in the field of teaching, training and research at various institutes. She has published two books on Agribusiness Management and several research papers have been accepted for discussion at various national and international forums. She is currently involved in Agricultural exports: Developing effective backward and forward linkages in the fresh produce market for grapes and pomegranates under the brand name SUNPIKT Training and consultancy: This includes organization of events in the field of agriculture on behalf of embassies, trade associations and organisations from different countries such as ADEPTA, France and their Indian counterparts to facilitate sharing of ideas, transfer of technology and promotion of trade. Outbound agricultural tours & events: International crop specific educational tours are organized to countries that have developed a competitive advantage in terms of production, processing and marketing of specific crops or commodities.

4 Indian Agriculture & Agri-Business Management Dr. Smita S. Diwase M.Sc (Agriculture), MMS, Ph.D

5 Published by: Scientific Publishers (India) 5 A, New Pali Road, P.O. Box 91 Jodhpur (India) info@scientificpub.com Website: Branch Office Scientific Publishers (India) 4806/24, Ansari Road, Daryaganj New Delhi (India) Author, 2014 All rights reserved. No part of this publication or the information contained herein may be reproduced, adapted, abridged, translated, stored in a retrieval system, computer system, photo-graphic or other systems or transmitted in any form or by any means, electronic, mechanical, by photocopying, recording or otherwise, without written prior permission from the authors/editors and the publishers. Disclaimer: Whereas every effort has been made to avoid errors and omissions, this publication is being sold on the understanding that neither the editors (or authors of chapters in edited volumes) nor the publishers nor the printers would be liable in any manner to any person either for an error or for an omission in this publication, or for any action to be taken on the basis of this work. Any inadvertent discrepancy noted may be brought to the attention of the publishers, for rectifying it in future editions, if published. ISBN: eisbn: Printed in India

6 PREFACE Agribusiness management has always been challenging in terms of its dependence on climatic factors, seasonality, perishability of produce, localized production, bulky nature and price fluctuations amongst others. It has now become more challenging than ever, in the context of climatic change, natural resource constraints, soaring food prices, food security concerns and globalizat ion. This book aims at providing students of agribusiness, teachers, researchers, professionals and all those interested in the field of agriculture with a broader understanding of agribusiness as a system and the key concepts needed to successfully manage an agribusiness enterprise. It serves as a basis to gain a comprehensive understanding of how the agribusiness system operates and the challenges faced in the movement of food and fiber from the producer to the ultimate consumer. The first part of the book helps in understanding the context within which agribusinesses operate in India. It focuses on the breadth and scope of agribusiness in India, policy initiatives undertaken by the Indian Government and the legal framework within which they function. The book does not aim at a critical analysis, but at providing the agribusiness entrepreneur with information on the various programs in place which could be used to his advantage. The second half deals with the complex network of inter related activities performed on the farm and past the farm gate such as natural resource management, input management, marketing management, supply chain management and risk management, as well as the institutional linkages needed for the same. It addresses issues relevant to decision making in a rapidly changing, highly competitive market environment led by technological advancement in areas such as information technology and biotechnology. It provides an insight into management challenges related to rising input costs and shifting consumer preferences. Cases pertaining to the best practices and potential strategies adopted by a few innovative, successful organizations have also been incorporated. It is hoped that this book succeeds in generating and sustaining interest in this extremely interesting and challenging field of agribusiness. Dr Smita Diwase

7 CONTENTS Chapter 1 Agriculture in India 1-43 Role of Agriculture in the Indian Economy 1 Product Contribution 2 Factor Contribution 8 Market Contribution 9 Land Use and Distribution in India 10 Agricultural Production in India 10 Production of Food Grains and Commercial Crops 11 Agricultural Production of Principal Crops in India ( ) Food Consumption 18 Commercial Crops Production in India 19 Animal Husbandry 20 Agro- Industrial Complexes 27 Food Processing Sector 36 Government Initiatives 38 Quality Assurance, Codex Standards, Research & Promotional Activities Components of Food Safety Schemes 39 Challenges in Indian Agriculture 40 Chapter 2 Indian Agriculture Policy National Agriculture Policy, National Seeds Policy, Agricultural Price Policy 63 National Food Processing Policy 66 The Foreign Trade Policy

8 viii Indian Agriculture & Agri-Business Management Marine Fishing Policy 87 National Food and Biotechnology Policy 89 National Policy on Handling, Storage and 91 Transportation of Foodgrains National Policy for Farmers, The Nutrient Based Subsidy (NBS) Policy, The National Food Security Bill, New Investment Policy 2012 (NIP-2012) in the Urea Sector 96 Direct Cash Transfer Policy, Policy Shift in Agriculture 97 Chapter 3 Programmes and Schemes Schemes related to Natural Resources Management 100 Schemes related to Crops 104 Schemes related to Horticulture 114 Schemes related to Seeds 120 Schemes related to Fertilisers 125 Schemes related to Plant Protection 126 Schemes related to Machinery 128 Credit Schemes 129 Insurance Schemes 131 Agriculture Marketing Schemes 133 Cooperative Sector Schemes 141 Extension Schemes 143 Food Management Schemes 146 Trade Related Schemes 150 Policy and Plan Schemes 150 Animal Husbandry Schemes 151 Sheep Development Schemes 156 Poultry Development Schemes 157 Piggery Development Schemes 159 Fodder Development Schemes 159 Fisheries Development Schemes 160 Chapter 4 Agribusiness Management Agribusiness 163

9 Contents ix Agribusiness Network 164 Distinguishing Features of Agribusiness 165 Challenges in Agribusiness 167 Scope of Agribusiness 168 Forms of Organization 169 Agribusiness Management 171 Agribusiness Activities 173 Functional Management in Agribusiness 174 Agribusiness Economics 175 Setting up of an Agribusiness Enterprise 177 Case of Setting up a Corn Wet Milling Project in India 181 Change in Approach 184 Chapter 5 Production Management Production Systems 185 Specialization 186 Diversification 186 Natural Resource Management 193 Intensive Agriculture 194 Conservation of Biodiversity 196 Land 196 Water Resources 205 Case of Jain Irrigation Systems Ltd 208 Labour and Agricultural Wages 212 Sustainable Agriculture 213 Cropping Patterns based on Regional Agro-Climatic 214 Planning (RACP) Watershed Management 217 Watershed Management at Ralegan Siddhi 225 Effective Input Usage 227 Organic Farming 227 Global Positioning Systems (GPS) 231 Precision Farming 233 National Mission for Sustainable Agriculture 237 Agricultural Outsourcing 237

10 x Indian Agriculture & Agri-Business Management Chapter 6 Input Management Agricultural Inputs 238 Fertilisers 241 Changes in Fertilizer (Control) Order, Net Return From Fertilizers 245 Fertilizer Marketing 246 Effective Nutrient Usage 250 Government Intervention 252 Water 253 Integrated Water Resources Management 256 Water Management Principles 257 Agricultural Water Strategy (AWS) 258 Agricultural Water Use Efficiency 260 Irrigation Water-Use Efficiency 262 Integrated Irrigation Management 263 National Watershed Development Project for Rainfed Areas (NWDPRA) 266 Role of Government 270 Seed 273 Seed System 274 Institutional Role 275 The Seeds Act, Seeds (Control) Order, New Policy on Seed Development (NPSD), Protection of Plant Varieties and Farmers Rights Authority (PPV&FR), National Seeds Policy, Seeds Bill, National Mission on Seeds 279 OECD Seed Scheme, Amendment to NPSD, Seed Marketing 281 Agro-Chemicals 287 Methods of Pest Management 287

11 Contents xi Pest Management Techniques 289 Pesticides Marketing 292 Regulatory Environment 293 Insecticides Act, Strict Regulatory Regime 293 Computerized Online Pesticide Registration System, Quality Testing 295 Accreditation of Pesticide Analysis Laboratories 295 Intensive Pest Surveillance and Management 295 Capacity Building - National Institute of Plant Health 296 Management Plant Quarantine 296 Credit 297 Classification of Credit 298 Institutional Network 301 Flow of Institutional Credit to Agriculture 302 Government Initiatives in Credit Disbursement 303 Kisan Credit Cards 304 Micro Finance Innovations 306 Rural Infrastructure Development Fund (RIDF) 306 Warehouse Receipt Financing 307 Central Financial Assistance 307 Role of Financial Institutions 308 Infrastructure Management 309 Storage Infrastructure 310 Warehousing Infrastructure 311 Storage Capacity in India 312 Central Warehousing Corporation (CWC) 313 State Warehousing Corporations (SWCS) 313 Food Corporation of India 313 National Grid of Godowns 313 Government Intervention 315 Agricultural Machinery 316 Government Intervention 319 National Mission on Agricultural Mechanization (NMAM) 321

12 xii Indian Agriculture & Agri-Business Management Constraints in Mechanization 322 Mahindra and Mahindra Ltd: A Case in Mechanization 323 Information 331 Marketing Information 331 Sources of Information 333 Efficient Input Marketing System 334 Input Profitability Analysis 335 Chapter 7 Marketing Management Agricultural Marketing in India 337 Government Intervention 338 Model Act Direct Marketing 341 Private Markets 342 Special Commodity Markets 344 Farmer s Markets 345 Contract Farming 346 Land and Credit Markets 346 Agricultural Marketing Management 347 Classification of Agricultural Markets 348 Approaches to Agricultural Marketing 350 Functional Approach 350 Institutional Approach 351 Behavioral Systems Approach 353 Agricultural Marketing System 354 Physical Functions 354 Facilitative Functions 358 Pricing and Exchange Functions 359 Marketing Organization 370 Marketing Strategies 371 Role of Cooperatives in Agribusiness Management: 372 Case of AMUL Market Information System 377 Challenges and Government Intervention 378 Community Agricultural Enterprise 379

13 Contents xiii Chapter 8 Supply Chain Management Supply Chains 381 Vertical Cooperation 382 Horizontal Relationship 382 Nature of Association 382 Business Processes in the Agribusiness Supply Chain 383 Production 383 Processing/ Manufacturing 383 Wholesaling 384 Retailing 384 Logistics Service Providers 385 Logistics Outsourcing 385 Supply Chains Categories 386 Integrated Supply Chains 387 Supply Networks 388 Temperature Controlled Supply Chains (TCSCS) 388 Contract Farming 388 Factors Determining the nature of Supply Chains 397 Agribusiness Supply Chains in India 399 Meat Supply Chain in India 400 Transnational Meat Supply Chains 403 International Meat Supply Chains 404 Developing the Supply Chain 404 Advantages of Integration 405 Case of Venkateshwara Hatcheries Ltd 406 Success of Supply Chains 412 Chapter 9 Information Management Information and Communication Technology (ICT) 415 Agricultural Information Management Through ICT 415 Networking through ICT 415 ICT Applications in Agriculture 416 ICT Application in Agricultural Electronic Commerce 418 (E-Commerce)

14 xiv Indian Agriculture & Agri-Business Management ICT Application in Agricultural Research, Education and 420 Extension ICT Implementation in Agriculture 423 Market Research Information Network (MRIN) 425 Government Initiatives for ICT Implementation 425 Farmers Portal 427 Agmarknet 427 Agrisnet 429 National E-Governance Plan in Agriculture 430 Computerized Online Pesticide Registration System 430 Project Gyandoot 430 Kisan Call Centers 432 Village Knowledge Centers (VKCS) 433 Bhoomi Project 433 Akshaya Project 433 Drishtee 434 Eid Parry 434 Tata Kisan Kendras 435 Akashganga 435 Sustainable Access in Rural India Project (SARI) 436 I-Kisan Agri Portals and Kiosks 436 Integrated Information System for Foodgrains Management 437 Integrated Agro-Met Advisory Service 437 Indian Tobacco Company: A Case 442 Issues to be Addressed 449 Chapter 10 Agriculture Technology Varietal Development 451 Remote Sensing 452 Post-Harvest Technology 454 Plant Tissue Culture Technology 455 Biotechnology 455 Biotechnology in Crop Improvement 456 GM Crops 458 Photosynthesis through C3/C4 Systems 458

15 Contents xv Bioinformatics 458 National Agricultural Bioinformatics Grid (NABG) 458 Biotechnology in Horticulture 458 Bioactive Components 459 Technology Adoption 460 Monsanto: A Case 460 Applications of Geospatial Techniques in Agriculture 465 Agri Innovate India 467 Chapter 11 Risk Management Types of Risk 469 Management of Risk 470 Agriculture Insurance Company of India (AIC) 474 Forward Contracts 481 Futures Markets 482 Futures Trading in India 492 Forward Contracts (Regulation) Act, Organization of Futures Trading 496 Forward Markets Commission 497 Recent Policy Initiatives 499 Commodities in which future trading is being conducted 500 Futures Trading Terminology 503 National Multi Commodity Exchange 509 Commodity Futures Market in India 520 Grain Marketing Strategy: A Case 522 Chapter 12 Institutional Linkages to Agriculture in India 527- Ministry of Agriculture, GOI 529 Financial Institutions 537 National Bank for Agriculture and Rural Development 544 National Cooperative Development Corporation (NCDC) 559 National Dairy Development Board (NDDB) 561 National Cooperative Union of India (NCUI) 563 Agricultural & Processed Food Products Export Development Authority (APEDA) 567

16 xvi Indian Agriculture & Agri-Business Management Indian Council of Agricultural Research (ICAR) 570 National Agricultural Cooperative Marketing Federation of 589 India Ltd (NAFED) Food Corporation of India 594 Central Warehousing Corporation 602 National Horticulture Board 605 Central Food Technological Research Institute (CFTRI) 606 Export Promotion Organisations 611