India is likely to achieve record wheat output on back of good monsoon, says Tariq Anwar
Moneylife Digital Team 13 January 2014

The wheat production this year will be an all time high production and will beat all previous records, according to Minister of State for Agriculture and Food Processing Industries, Mr Tariq Anwar at an ASSOCHAM event held in New Delhi

India is likely to achieve record wheat production on back of good monsoon, Minister of State for Agriculture and Food Processing Industries, Mr Tariq Anwar said at an ASSOCHAM event held in New Delhi today.


“We have been receiving encouraging reports as the weather has been very good and the monsoon has supported us and I think this time we would achieve an-all time high production that would beat all previous records,” said Mr Anwar while inaugurating 6th Agri Business Summit: Infrastructure, Value Chain and Partnership' organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

On reports of stem rust in a wheat field in Haryana, the minister informed that government has already warned the farmers and it is taking an initiative in this behalf.


“Gross inefficiencies in the food supply chain had lead to an extraordinary rise in onion prices and there was no issue related to its production which has remained steady at about 17-18 million tonnes,” said a disappointed Mr Anwar.


“There is something seriously wrong in the way the onion market operates as it is due to inefficiencies in procurement and distribution system that such extreme price distortion takes place,” he added. “There are governance issues related to licensing of wholesalers, issues related to holding capacity of farmers, issues related to market price information and a number of such issues related to the whole supply chain which creates this kind of pricing contradiction.”


“There is a need to develop an incentive system to encourage both producers and distributors or sellers to adopt new technology to maximise production as we have not been able to use even the existing technologies available to us,” said Mr Anwar.


The minister also said that presently, farmers are discouraged to produce more as most of the surplus generated from farm produce is cornered by middlemen. He also stressed upon the role of contract farming to increase farm productivity and thereby increase agriculture income in the future.


He also sought serious industry intervention while emphasising on the importance of contract farming. Most states today would not debar any company from procuring directly from the farmers provided certain procedural issues are followed, said Mr Anwar, while conceding that there are certain issues related to Agricultural Produce Market Committee (APMC) Act in various states.


Some Key highlights of the Report that was released in the Summit include:


1. The share of public sector capital formation in agriculture & allied sectors has come down from 25% in 2006- 07 to about 15% in 2011-12 where as that of private sector has gone up from 75% to 85%. Greater public sector investment in agri infrastructure is needed to facilitate further private investment.


2. The level of farm mechanization is high for wheat/rice harvesting at 60-70% and less than 5% for other crops. The level of farm mechanisation for other farming activities like soil work and seed bed preparation, seeding and planting, plant protection and irrigation is still at meagre 30%-40%.


3. The storage shortfall stood at about 330 lakh metric tonnes (MT) in 2011-12, due to record procurements by the government, which has made creation of covered warehouses an urgent necessity.


4. India’s food processing levels are at just 2% of its overall annual production, which is abysmal compared to China (23%), Malaysia (83%) and USA (65%). Hence plenty of scope remains for increasing food processing activities, which in turn adds value to the end product.


5. Viability gap funding (VGF) needs to be encouraged to upgrade agri-marketing infrastructure. This can be coupled with private wholesale markets and terminal market complexes through innovative public-private partnership (PPP) models.

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