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Minister of Agriculture, Consumer Affairs, Food and Public Distribution Shri Sharad Pawar addressed the media at 5th Economic Editors’ Conference here today.
Shri Sharad Pawar’s opening remarks are as follows:-
The UPA Government has laid special emphasis on the agriculture sector. We are making all out efforts to not only strengthen the agriculture sector, but also fuel growth in ancillary sectors like Animal Husbandry, Dairy and Fisheries. We have been making all out efforts to not only enhance budgetary support to the agricultural sector but also create an environment wherein private investment will find it worthwhile to invest in this sector.
We have been making efforts towards policy interventions, which would not only revitalise the sector but would also create an environment where more wealth is created in this sector.
We have taken up the task of revising the Seeds Act 1966. In the proposed Seed Bill of 2004, we aim to bring in provisions for a more liberalized climate for investment by the private sector in the seed industry. At the same time the new Seeds Bill would also strengthen farmers rights and address farmers concerns with regard to save, use, exchange and sale of seeds. The new Bill seeks to accredit private organisations to conduct agronomic trials and at the same time also has provisions for compulsory registration of varieties. The new Bill would allow accreditation of private seed testing laboratories.
We have been actively working towards setting up a Agri-business Model in cooperation with the banking industry. The agri-business model would address the twin concerns of high unemployment in agricultural graduates and a lack of knowledge and information delivery systems in the farming sector. India today produces 11900 agricultural graduates every year. Out of which only about 2000 get employment in public and private sectors. The remaining 9900 agriculture graduates are either under-employed or unemployed. The attempt is to set-up Agri-business Centres in the rural areas in cooperation with banks and with the help of bank finance. These Agri-business Centres would be manned by trained agricultural graduates who would not only be selling agents for agriculture inputs but would also provide information and knowledge service to the farmer.
In order to provide a better holding capacity to the farmers and to facilitate trade of agricultural commodities we are implementing a Central Sector Scheme for Construction of Rural Godowns. During the three remaining years of the 10th Plan period we need to create storage capacity of 32 lakh tonnes in rural areas with a central outlay of Rs. 115 crores. It is envisaged that this would help farmers to store their commodities near their fields and in turn obtain loans and marketing credit from the banks, thereby preventing distress sale at the time of harvest. Realizing the importance of disseminating prices and market related information in respect of agricultural commodities to farmers.
It is proposed to provide online connectivity to about 37% of the total wholesale market in the country. We also intend to connect Commodities Exchanges so as to provide online information in respect of future prices on certain select commodities. We have also embarked upon a plan to make the agricultural marketing system more vibrant and competitive. We are shortly convening a meeting of State Agriculture Marketing Ministers to impress upon the need for adopting the Model Act on agricultural marketing. It is expected that the Model Act on agricultural marketing would help establish direct purchase centres for direct sale to consumers. It is also anticipated that this would bring about complete transparency in the pricing system and would enable payment to farmers on the same day.
Animal Husbandry, Dairying and Fisheries contribute about 30% to the output of agriculture and allied sector and have an important role in providing substantial employment opportunities and generating supplemental income for the small and marginal farmers and landless persons, apart from making available cheap and nutritious food to vast sections of our people. We have a livestock population of about 483 million including 187 million cattle and 97 million buffaloes. India is endowed with the largest cattle and buffalo population in the world. India is the highest producer of milk and fifth highest producer of eggs in the world.
Though the productivity of our livestock population has registered growth in the recent years as a result of various programmes undertaken by the Central and State Governments, the fact remains that it is still considerably below the world average. We have decided to intensify and strengthen our programmes for genetic upgradation of cattle and buffaloes, improvement in the delivery mechanism of breeding inputs and services to farmers and provision of adequate animal health services along with creation of disease free zones. Cross-bred cattle which at present account for about 12% of the total cattle population has to be increased to at least 20%. This will result in an increase in the average productivity of cattle by about 15%. Along with this dairy development programme will be accelerated.
Dairying is an important tool for bringing about socio-economic changes among the farming community by providing subsidiary occupation and remunerative price for milk. Efforts of the Government are concentrated on promotion of dairy activities in non-operation flood areas with emphasis on building up cooperative infrastructure, revitalization of sick dairy cooperative federations and creation of infrastructure for improving the quality of milk and milk products. Besides this, NDDB continues its activities for overall development of dairy sector in operation flood areas.
Fisheries, both marine and inland, have shown significant increase in production in the recent years, reaching over 6 million tones annually. However, the potential for further increase in production is tremendous, particularly in inland aquaculture. Vast areas of water under reservoirs have remained substantially underutilized for fish production and potential for taking up cold water fisheries in the uplands of the country has yet to be tapped in a significant manner. Inland aquaculture needs coordinated efforts in terms of investment, provision of inputs like seed and feed and making available effective health care. In the marine fisheries sector, potential for further increase in production from shallow coastal waters may be limited; but we have to take more effective steps for better exploitation of oceanic resources. Other aspects which need immediate attention are strengthening of infrastructure like modern and adequate berthing and landing facilities for fishing vessels, mechanization of fishing boats and efficient post harvest operations. A proposal is under active consideration to set up a National Fisheries Development Board to implement fisheries development activities in a more purposeful and coordinated manner.
With a view to aggressively promote agri-business in the country, the Small farmers’ Agri-Business Consortium (SFAC), an autonomous body under the Ministry of Agriculture, in the process of formulating a new scheme to provide Venture Capital Assistance to agri-business projects and a Project Development facility to assist producer groups/ organizations in formulation of economically viable agri-business projects. Venture capital assistance will be provided to the projects that link producers to assured markets. The scheme envisages a single window operation for the disbursement and disinvestment of venture capital to be operated through the participating banks. This would involve a close partnership between the SFAC and the lending Banks. Enhanced capital through budgeting support will be provided to SFAC for this purpose. Commercial Banks would be involved intensely to finalise the modalities of the scheme.
In order to identify policy initiatives for strengthening the Targeted Public Distribution System (TPDS) which is a joint responsibility of the Central and State Governments, a one day Conference of State Food Ministers and other stakeholders was organized on 28th October, 2004. Important decisions taken there include:
· Requesting Planning Commission to re-determine BPL estimates, in tune with ground realities,
· Increased coverage of families at the risk of hunger under the TPDS,
· Finalizing steps to improve the viability of PD shops,
· Widespread publicity about scale of issue and prices under PDS by State Governments, and
· Convergence of food-based Welfare Schemes and Poverty Alleviation Programmes.
In regard to the NCMP announcement regarding special schemes to reach foodgrains to the most destitute and infirm, the Government of India issued instructions on 3rd August, 2004 to continue and expand the Antyodaya Anna Yojana to cover an additional 50 lakh BPL families taking the total number of beneficiaries from 1.5 crores to 2.0 crores. Detailed instructions regarding the identification of the additional families have already been issued to the State Governments. In pursuance thereof the State Government of Andhra Pradesh has completed the identification of additional beneficiaries.
To ensure improved foodgrains availability of good quality and cater to local tastes, State Governments have been encouraged to take up procurement of foodgrains under the decentralized procurement scheme which serves the twin objectives of ensuring remunerative prices to local farmers as well as reduce the dependence of State Governments on the FCI for their PDS requirement. This would also result in savings in food subsidy due to reduced freight and lower administrative cost.
In specific terms, the following four decisions have been taken :-
· Transportation costs incurred by the State Governments for the transportation of paddy from the procurement centre to the storage point and from the storage point to rice mills for milling which were earlier not being reimbursed will now be reimbursed at full cost;
· State Governments were facing difficulty in milling of paddy. The milling rate for parboiled paddy has been increased from Rs. 15 per quintal to Rs. 20 per quintal;
· Societies engaged in procurement earlier had no incentive. It has now been decided that all societies engaged by the State Governments for procurement operations would be entitled to a commission of 1% of the MSP;
· The State Governments were provisionally not being reimbursed the full cost on the transportation of gunny bags. It has been decided that the full cost of freight, including transportation from the rail head to the procurement centres would be fully reimbursed.
In addition to the above, prompt releases of subsidy and continuous interaction with the State Governments have encouraged several States to take up localized procurement. So far, the Governments of West Bengal, Madhya Pradesh, Uttar Pradesh, Chhattisgarh, Uttaranchal, Orissa, Tamil Nadu and Andaman & Nicobar Islands have adopted the Scheme. Other non-traditional States such as Bihar and Maharashtra have also taken up procurement foodgrains through their agencies. Negotiations are also being held with the North-Eastern States of Assam, Nagaland and Tripura to adopt the decentralized procurement scheme. As a result, it is expected that during the current Kharif Marketing Season, which has commenced on 1.10.2004, an additional 20 lakh tonnes would be procured in the States which have adopted decentralized procurement.
Along with the liberalization of the economy, commodity futures markets in India have been liberalized by allowing all commodities for futures trading. Besides, the Government has facilitated the setting up of modern, corporatised and demutualized nation wide commodity exchanges viz., NMCE, Ahmedabad, MCX and NCDEX at Mumbai equipped with electronic trading and clearing systems. Other operational exchanges are also being encouraged to adopt reforms to demutualize and adopt online trading, time stamping, trade guarantee and settlement mechanism, one-third independent board representation, and back-office automation. In order to increase the volume of trading, the Forward Markets Commission in signing an MOU with Exchanges for setting bench mark targets.
Steps are being taken to strengthen the Regulator i.e. Forward Markets Commission based on a IIM, Lucknow study and the report of the “Inter-Ministerial Task Force on Convergence of Commodity and Securities Derivatives Markets”. To make the FMC a professional and skilled Market Regulator, Ministry of Finance has agreed to create 39 additional posts at senior and middle level in addition to engaging six specialized consultants in the field of Law, IT and Finance. The Forward Contract (Regulation) Act, 1952 is being suitably amended to cope with the emerging challenges in the commodity futures market.
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