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Agri-Business - The Resurgence of Agriculture in India

Agriculture in India is being redefined with emerging trends that are giving it the contours of a lucrative business. Farmers association, marketing associations and corporatization of agriculture in India means that the transition of the sector from small farm based unit to modern corporatized Agri Business units is complete.

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Agri-Business - The Resurgence of Agriculture in India

  1. 1. Emerging Trends inEmerging Trends in Agriculture Sector in IndiaAgriculture Sector in India Sukant Senapaty Bhubaneswar
  2. 2. IntroductionIntroduction  India is an Agrarian economy with around 60% Population dependent on agriculture for Living. Post Independence India faced with the challenge of scanty Production  Green revolution, White Revolution, Pink revolution and Blue revolution ensured that India leads in many Food Items today.
  3. 3. Today the average agriculture sector growth in India is impressive at around 4.7% for the last three years.  India leads in the world in the production of food items like Milk Papaya Fruits Pulses Millets Chilies Mangoes Jutes Ginger It is the second largest producer of the following food items in the world Wheat Rice Sugarcane Groundnuts Onions Potatoes Tea Goat meat Gourds · Data based on statistics from the FAO for the year 2009.
  4. 4. Shifting Paradigms in Agriculture Sector inShifting Paradigms in Agriculture Sector in IndiaIndia Rising urban population  The number of people living in the urban clusters has increased from 70 million in 1991 to 108 millions in the year 2001. The Urban population comes with a huge demand for food and food products and equally and a proportionate buying power. Urban population has facilitated the spawning processed food market as well as the growth of organized retail.
  5. 5. Shrinking Farm Size  Land under cultivation in India has remained at 140 million hectares since 40 years while the number of farmers has increased from 7 crore to 14 crore. Shrinking farm Sizes decreases farmers capacity to invest in land and get favorable outputs.  This has led farmers to leave the farms untilled and seek employment elsewhere
  6. 6. Restructuring Farms & Farming Practices Mixed Farming : It involves agriculture with livestock production . Mixed farming is the best answer to shrinking farm . Horticulture : Apart from staple crops like rice and wheat, farmers are shifting towards horticulture in a big way.
  7. 7. Emerging Trends in AgricultureEmerging Trends in Agriculture SectorSector Farm – Market Linkage  Linking farms to market through farmer’s association and marketing Federation is an aspect that is picking up fast.  Traditional linkage like wholesalers are being removed in the process.  India has today more than 70 cities with more than 1 million population.  Marketing bodies like GCCMF have been phenomenally successful marketing produces like Amul
  8. 8. Emergence of Corporate  Corporate like ITC, Mahindra,Cargill are actively in the agri-sector.  With this there has been a shift from the demand driven supply chain to a supply driven chain.  Roles of mandis is getting minimized  This has led to the rise of contarct farming which is practiced today under three categories  Market Specification contract  Production- Management contract  Resource Providing Contract
  9. 9. Rise of Organized Retail  Retailing giants like Reliance fresh , Spencers etc have redefined the face of Indian Agri Sector.  Indian food retail industry has grown from $306.1 billion in 2009 to $443.7 billion in 2014, a growth of 45%  Benefits that have accrued to farmers include:  Better infrastructure & less post-harvest loss  Improved technology & logistics  Elimination of middlemen
  10. 10. Emergence of Rural Business Hubs  Rural Business Hubs ( RBH) help in developing relationship between rural producers and business partners with active facilitation by the Panchayats.  Its aim include  Linking rural producers with the wide market through a professional marketing partners.  Based on economic activity not charity.  Any economic activity like agriculture/horticulture/ handicraft can be taken up. Located in Rural areas.
  11. 11.  RBHS are slowly becoming face of Business houses in villages.  ITC ( Chiupal Sagar) , Tata ( Kisan Sansar), Future Group (Sansar) are some prominient RBH  vast array of services are provided to farmers in RBH and include buy back arrangement of produce,providing agri input services and some RBH act as retailers to farmers as well.
  12. 12. Implications Of Emerging TrendsImplications Of Emerging Trends Agriculture sector is witnessing a major reshuffle with factors like urbanization and corporatization , opening new vistas of opportunity. Traditional farmers are reinventing themselves with chnaging times and opting for viable modes of farming like horticulture and mixed farming . Role of marketing bodies and farmer associations in collecting and marketing farm produce is going to get bigger in the future.
  13. 13. Thank YouThank You Sukant Senapaty Bhubaneswar