Draft farm policy says predictability, APMC and land reforms, food security crucial

NEW DELHI: With the aim to double India’s farm exports to over $60 billion by 2022, the commerce department has circulated the Draft Agriculture Export Policy recommending a stable and predictable policy with limited state interference, reforms in APMC Act and streamlining of Mandi fee along with liberalisation of land leasing norms including contract farming.
“The proposed Agri Export Policy is framed with a focus on agri export oriented production, export promotion, better farmer realization and synchronization within government of India,” the department said in the draft released Monday.

The policy aims at making India become one of the top 10 exporting countries of agricultural products and strive to double India’s share in world agri exports by boosting high value and value added agricultural exports, focusing on perishables and promote novel indigenous, organic, ethnic traditional and non-traditional categories.

India is currently ranked ninth amongst the major exporters globally as per WTO trade data for 2015. India’s share in global exports of agriculture products has increased from 1% a few years ago, to 2.2% in 2016.

It also seeks to provide an institutional mechanism for tackling market access barriers and deal with sanitary and phytosanitary issues.

Citing global bodies like US FDA and European Food Safety Authority which are empowered to frame, regulate and implement policies related to both agricultural production and trade, the policy said it "may be worthwhile to work towards similar agencies in India”.

The Department of Commerce has sought views of the stakeholders on the draft till April 5.

Export restrictions

The policy intends to provide a policy assurance that the processed agricultural products and all kinds of organic products will not be brought under the ambit of any kind of export restriction such as Minimum Export Price, export duty and export ban,m even though the primary agricultural product or non-organic agricultural product is brought under some kind of export restrictions.

Significantly, it also talks about initiating consultations among the relevant stakeholders to identify the commodities which are essential from food security perspective and barring such identified commodities, the effort would be to ensure that other agricultural products would not be brought under any kind of export restriction

APMC reforms

The draft policy also said that monopoly of the Agricultural Produce Market Committee (APMC) prevents private players from setting up markets and investing in market infrastructure.

"Efforts will continue with state governments to remove perishables from their APMC Act. State governments would also be urged to standardize/ rationalize mandi taxes for largely exported agricultural products," it added.

Simplification or uniformity of mandi/agricultural fee across states will create a transparent supply chain that will empower the farmer, provide him wider access to markets and enable free trade across the country, it said.

The policy made a strong case for promoting contract farming as it would help in attracting investments.

Food losses

Various studies on fresh fruits and vegetables, fisheries in India have indicated a loss percentage ranging from about 8% to 18% on account of poor post-harvest management, absence of cold chain and processing facilities. Therefore, agro processing and agricultural exports are a key area for us.

The draft policy has also pitched for greater involvement of states, improvement in infrastructure and logistics and promotion of R&D activities for new product development for the upcoming markets.