Agro Based Industries In India Essay

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What is food processing industry (FPI)?

Right from the cultivation and harvest of crop, upto the consumption of product by consumer, there is certain degree of value addition in every product. This value addition can be of numerous types. As it goes from producer, to wholesaler, to retailer and finally to consumer, every stage adds some value to the product. In this value chain there may be value addition by Sorting, grading, packaging, branding etc. These activities not makes product attractive, more usable, gives choice and awareness to customers and also enhances shelf life of products. Apart from this service rendered by intermediaries to pass on product from producer to customer is also valuable.

Most of the agricultural products are not consumable in their original form, for which they are processed. Wheat is converted into flour, Paddy into rice, sugarcane into jagery, Sugar, ethanol, alcohol etc. These products can be further processed such as flour into bread. Apart from this, left over part of crop such as risk husk can also be processed to get some useful product for e.g. Rice Bran oil, cattle feed, Sugarcane bagasse can be used for power cogeneration.

Hence, food processing not merely adds value to the agro products, but also increases their utility. We know that activities in an economy are broadly divided into Agriculture, industry and Services. Food processing Industry is the product of agriculture and Industry.

Where India stands and why food processing is important?

India Food Processing Industry is estimated at $135 billion industry which is growing at about 8% annually. This growth rate is significantly more than agricultural growth rate which remains around 4%. These signals indicate toward phenomenal shift toward food processing from traditional ways. GDP by processing constitute about 10% that of agriculture. But given potential of India, this is an underachievement.

India has about 26 types of different climatic conditions, 46 varieties of soils are there in India out of total 60 types of soils worldwide. 127 ‘agro climatic zones’ have been identified in India. Also, Indian food is known worldwide for its unique taste and aroma.

India’s regional and cultural diversity is perfectly reflected in food. Every state in India has something unique to offer. For e.g. South Indian, Gujrati, Bengali, Rajasthani and Punjabi delicacies are different and are admired in many parts of the world. But they haven’t been able to make inroads in other countries the way Mc Donald’s, Domino’s etc. has done in India. This is because lack of creativeness, innovation, branding and most importantly shallow pockets of Indian manufacturers.

India is largest producer of Pulses, Mangoes, Banana, Milk, ginger, Buffalo meat and 2nd largest producer of rice, wheat, potato, garlic, cashew nut, groundnut, dry onion, green peas, pumpkin, gourds, cauliflowers, sugarcane, and tea in the world. We produce 17 per cent of the global total of vegetables and 14 per cent in the case of fruits. About 40 percent of the world’s mangoes and 30 per cent of the world’s bananas and papayas are produced in India. Further, India has many unique things to offer such as Alphonso Mangoes and wheat of Madhya Pradesh is uniquely protein rich.

No surprise, that India is net exporter of agricultural products. But value addition of Indian product remains quite low. Indian Manufacturers haven’t moved much ahead in value chain. Say If mangoes are processed in to Mango Juice or pulp; it will result in more value addition, industry, employment, GDP and foreign exchange, but we export mainly mangoes as it is.

Indian agriculture is infested with post-harvest wastage problem. In category of fruits and vegetables it is about 30-40%. Overall, cost of wastage is estimated at about 18% ranging from 50000 crores to 1 lakh crore. Wastage is attributable to several factors including non-availability of facilities for sorting, grading, packaging, storage, transportation, cold chain and low level of processing of agricultural produce. Food processing can halve this loss. Consequently farmer will able to get more value and consumer will get products cheaper.

Consumption patterns in India are rapidly shifting from cereals to protein rich foods and horticulture. Also India has significant proportion of population which is undernutrition (1/3 of population), stunted and wasted. Horticulture and fruits are much desirable for this problem and wastage reduction will have decisive impact here.

Food processing has potential to turnaround whole economy. Indian economy is still agrarian, because about 55% population is directly dependent upon agriculture. FPI directly targets farming sector as it attempts to create more types of products out of single crop. This will increase demand for farmers and hence more remunerative prices.

India’s demographic dividend is much talked about and most of this lies in rural India. Indian youth is turning away from agriculture because of low profitability. FPI is perhaps best bet to seize opportunity of demographic dividend. It can give us a genre of progressive rural entrepreneurs. Prosperous countryside will have multiplier positive impact on socio-economic and political problems. In short, FPI can narrow gap between rural and urban India.

Apart from this India’s economy is under transition, Income classes are moving upward. Every year millions of households are coming out of poverty to be part of middle class. Per capita income is Increasing as GDP growth rate is much higher than population growth rate. This is complimented by growing urban culture, nuclear families, working couples. This makes case for processed food compelling. Consumption in India is gradually tilting towards packaged and ready-to-eat foods. Demand is bound to increase, but it has to be seen that to what extent opportunity is seized by Indian industry and how much is left for foreign companies.

FPI is employment intensive industry; it can be an answer to jobless growth of past decade. Currently, only 3 % of employment is in FPI, while in developed countries it handles 14% population. Again, much of the employment will be created into rural India. This can remedy problem of distress migration. Growth in direct employment in the organized food processing sector stands at 6 % between 2011-12.

Also, strategic geographic location and proximity to food-importing nations (Middle East and Africa) makes India favorable for the export of processed foods.

Last but not the least, world economies are integrating even rapidly year by year. So a country has no option but to remain competitive.

Global scenario

Food processing is one of the largest global sectors at $7 trillion annual production. Look around and you’ll find companies of Cold drinks, Wafer chips, Juice, restaurant chains to be among biggest ones. Italian pasta and pizza is now consumed in almost all countries, so are the burgers and sandwiches. Sugar free products, cornflakes, oats, ketchups etc. are among most demanded consumer goods. Currently only 2 % of India’s vegetable and fruits production is processed. In comparison USA and China processes their 90% and 40% produce. Other developing countries, such as Thailand, Philippines, and Brazil are processing as high as 30, 78 and 70% of their produce.

India’s food processing sector ranks fifth in the world in exports, production and consumption.

Importance of this sector is significant and it deserves a priority treatment by government. Accordingly sector has been made part of ambitious ‘Make in India’ initiative.


Supply Chain – Any product is mobilized from producer to consumer to be consumed. This route is called supply chain. This movement involves both time and costs. Lengthier supply chains will push prices upward and result in more wastage. In last articles regarding marketing of agro-products we came across various government policies and institutions, which among other things, increase number of intermediaries. Adequate storage facilities, direct farming, contract farming and negotiable warehouse receipt system are mechanisms to streamline, strengthen and shorten the supply chain.

Apart from these issues other major interventions and investments are needed in infrastructure sector, which is backbone of food processing industry. We have seen that India is biggest producer of numerous fruits and vegetable. Most of these are perishable and have very low shelf life. This is the major reason for high percentage of wastage. Their shelf life can be increased by adequate investment in infra such as cold storage, reefer vans, radiation plants etc.

Storage of foodgrains – FCI deals only in food grains and about 67 per cent of the storage capacity is concentrated in the six major procuring states namely, Punjab, Haryana, Uttar Pradesh, Andhra Pradesh, Rajasthan and Uttrakhand. Several States have emerged in recent years as important states for foodgrains procurement, namely, Bihar, Odisha, Jharkhand, West Bengal, Madhya Pradesh and Chhattisgarh presently account for 13 per cent of the current storage capacity.

Under the National Storage Policy, the bulk grain handling facilities are now being created on the Built Own Operate (BOO) basis at identified locations in the country.
Much of the problem here can be relieved by timely offloading of stocks.

Storage of Horticulture products – Mainly NAFED – it also owns godowns and cold stores.

India is currently having severe shortage of cold storage facilities. Significant majority of cold storage facilities were created between 2000 and 2011, assisted to some extent by interventions from National Horticultural Board (NHB), National Horticultural Mission (NHM), Horticulture Mission in North East and Himalayan States, Agricultural and Processed Food Products Export Development Authority (APEDA), Ministry of Food Processing Industries and Department of Animal Husbandry & Fisheries.

Cold stores are to some extent product specific. Majority of the cold stores in India are dedicated to potatoes. There are some that provide storages for chilies, dry fruits, spices, vegetables etc. Cold storage for meat, fish, milk and milk products and for other commodities such as spices account for only 1 percent of the total cold storage capacity. These cold storages are also usually smaller in capacity.

Nearly 96 per cent of cold storages are in the private sector and about 75 percent capacity of cold storages is used to store only potatoes while another 23 per cent fall under the multi-product category.

Value addition

Upstream and downstream/ forward backward integration (in supply chain)

Suppliers to a producers or trader lie on upstream side, where as customers lies on downstream side. This will change according person under observation. For a farmer, supplier of seeds and fertilizers lie on upstream, while cold store owners, farm contractors, mill owners, traders in agro output lies on downstream.

When a particular person in supply chain assume role of two levels it is said integration. If PepsiCo instead of procuring potatoes (for chips) from farmers get potatoes captively from its own lands, it will be called backward integration. On other hand if farmer puts up a processing plant for chips, or a cold storage, this will be called forward integration. Direct farming is also a forward integration, where farmer assumes role which was played by commission agent in APMC.

Forward and backward integration, also called vertical integration, is common in any business and it saves the costs associated with supply chain. Business which pursues integration strategy, earns a competitive edge. For example Reliance Industries owns oil and exploration business, refining business, retail outlets for petro products, and is India’s biggest polyester manufacturer. Consequently RIL has almost monopoly in these sectors.

In farming and food processing, vertical integration can work wonders. For this farmer needs financial and technical support. Agriculture in India already is overemployed. This with seasonal nature of majority of farming crops gives farmers a compelling reason to get into food processing business.


  1. Ministry of Food Processing Industries (MOFPI)
    – formed in 1988

    a) The Ministry is nodal agency for FPI and is concerned with formulation and implementation of the policies & plans for the food processing industries within the overall national priorities and objectives.

    b) Facilitating creation of a conducive environment for healthy growth of the food-processing sector.

    c) Creation of World Class Infrastructure

    d) Promotion of R&D in Food Processing sector

    e) Human Resource Development to meet the growing requirement of managers, entrepreneurs and skilled workers

    f) Assistance for setting up analytical and testing laboratories, active participation in the laying down of food standards and their harmonization with international standards.

    g) Continue intensive consultation with industry, academia, scientists and representatives of State Governments

    h) Has set up a national level institute of International standard –  National Institute of Food Technology Entrepreneurship and Management (NIFTEM) at Kundli in Haryana

    i) Decentralisation in the implementation of various schemes with greater involvement of the States/UTs. The Ministry has launched a new Centrally Sponsored Scheme-National Mission on Food Processing (NMFP) with effect from 01.04.2012.

  2. Agricultural and Processed Food Products Export Development Authority (APEDA) –  an apex organization under the Ministry of Commerceand Industry – focus on ‘export’ of
    scheduled products

    Authority was established in 1985, by an act passed in parliament. Main functions are –

    a) Development of industries for export by way of providing financial assistance or for undertaking surveys and feasibility studies, participation through joint ventures and other subsidy schemes

    b) Registration of persons as exporters

    c) Fixing of standards and specifications for the products for the purpose of exports;

    d) Carrying out inspection of meat and meat products in slaughter houses, processing plants, storage premises, conveyances or other places where such products are kept or handled for the purpose of ensuring the quality of such products;

    e) Improving of packaging of the products;

    f) Improving of marketing of the products outside India;

    g) Promotion of export oriented production and development of the products;

    h) Training in various aspects of the industries connected with the products;

    has set up common infrastructure facilities like ‘centre for perishable cargo’ at various international airports. Facilities such as Vapor Heat Treatment plants, irradiation facilities, integrated pack houses, pre-cooling facilities, and high humidity cold stores for specific horticulture products are also there.

    Additionally, it provides financial support to exporters for installing facilities such as Reefer Vans and in-house above mentioned facilities.

    Similarly, Marine Products Export Development Authority (MPEDA) is there for fishery production and related activities.

  3. Department of Animal Husbandry, Draying & Fisheries

    The Department is responsible for matters relating to livestock production, preservation, and protection from disease and improvement of stocks and dairy development, and also for matters relating to the Delhi Milk Scheme and the National Dairy Development Board. It also looks after all matters pertaining to fishing and fisheries, inland and marine.

    The Department advises State Governments/Union Territories in the formulation of policies and programs in the field of Animal Husbandry, Dairy Development and Fisheries.

  4. National Horticultural Board (NHB) under – Ministry of Agriculture

    The broad aims & objectives of all the above mentioned schemes are as under: –

    1. Development of hi-tech commercial horticulture in identified belts
    b) Development of modern post-harvest management infrastructure as integral part of area expansion projects or as common facility for cluster of projects
    c) Development of integrated, energy efficient cold chain infrastructure for fresh horticulture produce,
    d) Popularization of identified new technologies / tools / techniques for commercialization / adoption, after carrying out technology need assessment,

    e) Setting up ‘Common Facility Centers’ in Horticulture Parks and Agri-Export Zones

    1. Transfer of technology to producers/farmers and service providers such as gardeners, farm level skilled workers, operators in cold storages, work force carrying out post-harvest management etc.

    FDI in food processing


  5. 100% FDI is permitted in the automatic route for most food products except for items reserved for micro and small enterprises.
  6. 100% FDI is permitted for alcoholic beverages, with the requirement of an industrial license.
  7. For pickles, mustard oil, groundnut oil and bread – items reserved for the micro small and medium sector, 24% foreign direct investment is allowed under the automatic route, with the requirement of prior approval from the Foreign Investment Promotion Board for FDI amounting to more than 24%.

Vision 2015

Vision 2015 which was adopted in 2010 provides for enhancing the level of processing of perishable to 20%, enhancing value addition from 20% to 35% and increasing India’s share in global food trade from 1.5% to 3% by the year 2015. To achieve these targets, investment of Rs.100 thousand crores was estimated by year 2015, out of which Rs.10000 crores was to come from the Government. Vision 2015 provides for establishment of 30 Mega Food Parks in public-private partnership, so far 21 such projects have been approved and approval of 4 projects is pending. List can be accessed here. 1st Mega Food Park to open was in sirni food park in Andhra. Recently ‘Tumkur Integrated Food Park’ was inaugurated in Karnataka. This is the first integrated food park which has been developed with partnership from the Ministry of Food Processing Industries, and the State government. Now list of mega food parks to be set up has gone up to 42, since make in India initiative.

Mega Food Park

As envisaged by vision 2015, Mega Food Parks, are to be based on ‘cluster approach’. In India there are regional horticultural crops, which are dominantly grown in a particular area. In these areas there is generally cluster of similar farmers, factories, and traders etc. who dominantly deal in same agro product. Scheme aims to strengthen such clusters by providing world class infrastructure facilities. This will result in smoothening of supply chain – ‘Farm to Market’.

Hub and spoke model is adopted, as per which there will be a strong Central Processing Unit, which will cater needs of surrounding areas. In surrounding areas, there will be smaller, ‘primary processing centers’ which will be fed from numerous ‘collection centers’. These collection centers will have direct interface with the farmer, farmer groups, or self-help groups.

This will lead to vertical integration (backward and forward integration) in activities of that particular area.

Central Processing units are to be built under public private partnership. Area for will range from 50-100 acres, though the actual requirement of land would depend upon the business plan, which may vary from region to region.

Onetime capital grant of 50% of the project cost (excluding land cost) subject to a maximum of Rs. 50 crore in general areas and 75% of the project cost subject to a ceiling of Rs. 50 crore in difficult and hilly areas, is available.

Program Management Agency is appointed by the Ministry to provide management, capacity building, coordination and monitoring support. For meeting the cost of the above and also other promotional activities by the Ministry, a separate amount, to the extent of 5% of the overall grants available, is earmarked.

It is expected that on an average, each project will have around 30-35 food processing units with a collective investment of Rs.250 crores that would eventually lead to an annual turnover of about Rs.450-500 crores and creation of direct and indirect employment to the extent of about 30,000 persons.

Special Purpose Vehicle

The execution, ownership and management of the Mega Food Park are vested with a Special Purpose Vehicle (SPV). SPV shall be a body corporate (company) registered under companies act. For details see

Special Purpose Vehicle is term commonly used in corporate world. It mobilizes funds, expertise and experience of more than one organization toward a common goal. For example a company will be formed by pooling funds of interested parties and this company will be called SPV.

Definition, functions etc. of SPV can differ from case to case. In this case it is responsible for ‘execution, ownership and management’ of Mega Food Parks.

Special Fund in NABARD

Government of India instituted a Special Fund in National Bank for Agriculture and Rural Development (NABARD) with a corpus of Rs. 2000 Crore during 2014-15 for providing direct term loans to establish infrastructure in the Mega Food Parks as also to the individual processing units to be set up in the designated Food Parks, at affordable rate of interest of around 10% p.a. The designated Food Parks would include Food Parks promoted by the Ministry of Food Processing Industries (MoFPI) or State Governments; Mega Food Parks promoted by MoFPI; food processing units set up in the Special Economic Zones or any other areas having developed enabling infrastructure and designated as Food Park by the MoFPI

Scheme of Cold Chain, Value Addition and Preservation Infrastructure (Cold chain facility)

It aims to facilitate the establishment of a strong cold chain facility for agricultural, horticultural, dairy, fish & marine, poultry & meat products by establishing linkage from farm gate to the consumer, end to end, to reduce losses through efficient storage, transportation and minimal processing.

Its components are:

  1. Processing Centre at the farm level and centers is to have facility for weighing, sorting, grading waxing, packing, pre-cooling, Control Atmosphere (CA)/ Modified Atmosphere (MA) cold storage, normal storage and Individual Quick Freezing (IQF).
  2. Mobile pre-cooling vans and reefer trucks.
  3. Distribution hubs with multi products and multi Control Atmosphere (CA)/ Modified Atmosphere(MA) chambers/ cold storage/ Variable Humidity Chambers, Packing  facility, Cleaning in Process (CIP) Fog treatment, Individual Quick Freezing (IQF) and blast freezing.
  4. Irradiation facility

Financial assistance of 50% the total cost of plant and machinery and technical civil works in General areas and 75% for NE region including Sikkim and difficult areas (J&K, Himachal Pradesh and Uttrakhand) subject to a maximum of Rs.10 crore.

Cold Chain for Non-Horticulture Products is also being funded under National Mission on Food Processing which provides Capital subsidy of 35% of cost of project or Interest subvention by 6% (max 5 crore). Also subsidy of 50% is available on investment in ‘reefer vehicles’ (max. 50 lakhs).

NABARD too provides concessional finance for construction of warehouses, godowns, silos and cold storage units.

Modernization of Abattoirs (slaughterhouse)

This is a comprehensive scheme, which includes establishment of modern abattoirs and modernization of existing abattoirs. Modernization of abattoirs will also include upscaling of infrastructure of existing abattoirs. The scheme is implemented with the involvement of local bodies and has flexibility for involvement of private investors on PPP basis.

The scheme envisages a grant of 50% of the cost of plant and machinery and technical civil works subject to a maximum of Rs.15.00 Crores in general areas and 75% of the cost of plant and machinery and technical civil work and other eligible items subject to a maximum of Rs. 15.00 Crores in difficult areas.

Agri Export Zones

To give thrust to export of agro products, new concept of Agri Export Zones was brought in 2001. APEDA has been nominated as the Nodal Agency to coordinate the efforts on the part of Central Govt. negotiations.

Entire effort is centered on the

  1. cluster approach of identifying the potential products,
  2. the geographical region in which these products are grown and
  3. Adopting an end-to-end approach of integrating the entire process right from the stage of production till it reaches the market. (farm to market)
  4. There would also be a need to identify/enlist difficulties/ problems encountered at each stage

Identification of such potential crops is responsibility of state governments. Projects in such areas for identified crops will be eligible for financial assistance and certain fiscal incentives.

Financial Assistance – example

These extend from providing financial assistance for Training and Extension, R&D, Quality Upgradations, Infrastructure and Marketing etc.

Fiscal Incentives – example

The benefits under Export Promotion Capital Goods Scheme, which were hitherto available only to direct exporters, have now been extended to service exporters in the Agri Export zones.

Under this scheme import of capital machinery will be allowed at concessional custom duty, provided importing units commits to export of certain quantity of agro products after commencement of production.

Currently there are about 60 Agri Export Zone. Checkout which one is in your region here


Apart from this National Mission on Food Processing is in place since 2012, which subsumed a number of schemes. Main objective of the mission is to decentralize implementation of food processing related schemes to States.

Other initiatives by government –

  1. National Food Processing Policy – Target 2025 – increase food processing to 25% of agro produce.
  2. Food Processing is recognized as a priority sector for Bank lending. 

Role of small scale sector

The small scale and unorganized sector constitutes about 70% of the food processing sector. Employment intensity is significantly higher in this sector as compared to the organized sector for the same level of investment.

Unfortunately, sector suffers from low efficiency due to the lack of – access to credit, managerial knowledge, efficient tools/ technology, marketing network etc. Intense competition from large scale players has also affected it.

Further, in export too dominance is of small scale sector. Due to financial constraints they fail to add much value to the products. Real value adding processing happens to most exported products abroad. These products have very low brand value. Lastly, small scale industry is extremely risk averse, afraid of trying new products, technologies, markets.

In contrast global companies in competition are giants such as Pepsi, Kellogg’s etc. These companies have huge economies of scale, influence in International politics and invests substantial amount in R&D.

At the processing stage small scale industry needs targeted programs to improve productivity, access to technology, credit and downstream markets. This will also enable reduced wastage and nutrition losses in processing. Potential programs could include financial assistance for procurement of machinery, credit, technical advice on productivity improvement and machinery selection and trainings on adopting standardized processes. Many of these initiatives are already there on part of the government, but information deficit and risk avoidance comes in the way.

To achieve these objectives to some extent, it is imperative that supply chain infrastructure be built. Organized sector has capacity to build this Infra, which can also cater to needs of Small scale sector.

Government has reserved certain Items exclusively for small scale industries which includes pickles, chutneys, bread, confectionery, rapeseed, mustard, sesame oils, groundnut oils, ground and processed spices, sweetened cashew nut products, tapioca sago and tapioca flour.

Cooperative sector experiments can also bring small scale sectors into organized form as was seen in success of AMUL and Lijjat Papad managed by cooperative named Shri Mahila Griha Udyog Lijjat Papad.

Safety, Hygiene and regulations

Extensive use of fertilizers, pesticides and other chemicals has raised concerns about quality of food. Further, protection is needed from unfair and hazardous practices such adulteration, Synthetic milk and milk products etc. For this Food Safety and Standards Act was enacted in 2006 prior to which there were plethora of laws under different ministries, which were overlapping and confusing. FSSA was aimed at providing single point reference for all matters relating to food safety and standards.

Food Safety and Standards Act 2006

Ministry of Health & Family Welfare has been designated as the nodal Ministry for administration and implementation of the Act

Act established an independent statutory Authority – the Food Safety and Standards Authority of India with head office at Delhi. These along with State FSSAs secure compliance of various provisions of the act.

  • Framing of Regulations to ‘lay down the Standards and guidelines’ for articles of food and specifying ‘appropriate system of enforcing’ various standards so laid.

  • Laying down mechanisms and guidelines for accreditation of certification bodies engaged in certification of food safety management system for food businesses.

  • Laying down procedure and guidelines for accreditation of laboratories and notification of the accredited laboratories.

  • To provide scientific advice and technical support to Central Government and State Governments in the matters of framing the policy and rules in areas which have a direct or indirect bearing of food safety and nutrition.

  • Collect and collate data regarding food consumption, incidence and prevalence of biological risk, contaminants in food, residues of various, and contaminants in foods products, identification of emerging risks and introduction of rapid alert system.

  • Creating an information network across the country so that the public, consumers, Panchayats etc. receive rapid, reliable and objective information about food safety and issues of concern.

  • Provide training program for persons who are involved or intend to get involved in food businesses.

  • Contribute to the development of international technical standards for food, sanitary and phyto-sanitary standards.

  • Promote general awareness about food safety and food standards.

The Sanitary and Phytosanitary Measures Agreement (SPS agreement)

This agreement was one of the results of Uruguay Round of negotiation entered into force with the establishment of the World Trade Organization on 1 January 1995. The Agreement sets out the basic rules for
food safety and animal and plant health standards. It allows countries to set their own standards. But it also says regulations must be based on science. They should be applied only to the extent necessary to protect human, animal or plant life or health. And they should not arbitrarily or unjustifiably discriminate between countries where identical or similar conditions prevail.


Codex Alimentarius Commission is an international agency on food standards in which almost all members of WHO, and Food and Agriculture Organization of United Nations (FAO) are members. These members agree to adopt standards on food established by CODEX. There is also reference, endorsing use of CODEX standards, in WTO’s SPS agreement.

Any member nation willing to set standards over and above CODEX will have to give scientific justification and explanation for that matter.

Hazard Analysis and Control Critical Point (HACCP)

HACCP is a management system in which food safety is addressed through the analysis and control of biological, chemical, and physical hazardsfrom raw material production, procurement and handling, to manufacturing, distribution and consumption of the finished product.

This system is recommended by CODEX and used by it for setting standards.

International Standards Organization (ISO)

ISO is international independent organization, engaged in formulation and setting up of standards for different products including processed food products. It has overtime become a brand and products marked with ISO enjoys premium in markets. It should be noted that ISO standards are not something which is enforced by government, WTO, WHO etc. It is purely voluntary on part of manufacturer.

ISO doesn’t certify itself; there are other entities which certify. ISO just set standards.

‘ISO 22000’ deals with ‘food safety management’ and ‘ISO 14000’ deals with environmental impact

Food safety and hygiene is critical for development of sector. In era of intense global competition countries implement these standards jealously to guard their domestic industries. These sometimes get converted into non-tariff barriers.

Recently, India Alphonso mangoes were banned by European Union due to the presence of harmful pests and a lack of certification before export.

To overcome this problem MOFPI runs scheme of ‘R&D, quality, CODEX and promotional activities’

This scheme includes financial assistance and technical support for –

  1. Setting up/up-gradation of quality control centers or Food testing labs
  2. Implementation of quality assurance mechanisms such as
    Total Qty. Management (TQM) including ISO 14000, ISO 22000, HACCP, GMP, GHP
  3. R&D is food processing sector
  4. Other promotional activities

Food Irradiation – (the application of ionizing radiation to food) is a technology that improves the safety and extends the shelf life of foods by reducing or eliminating microorganisms and insects. Like pasteurizing milk and canning fruits and vegetables, irradiation can make food safer for the consumer.



Radiation processing is a cold process and therefore, unlike heat, it can be used on agricultural commodities without changing their fresh-like characterRadiation processing is a need based technology and cannot be applied to all kinds of foods
Radiation processing dose not alter significantly nutritional value, flavor, texture and appearance of foodRadiation processing cannot make a bad or spoiled food look good
Radiation using Cobalt-60 cannot induce any radioactivity in food and does not leave any harmful or toxic radioactive residues on foods as is the case with chemical fumigantsdIt cannot destroy already present pesticides and toxins in foods
Due to the highly penetrating nature of the radiation energy, it is a very effective methodAmenability of a particular food commodity to radiation processing has to be tested in a laboratory
Prepackaged foods can be treated for hygienization and improving shelf-lifeOnly those foods for which specific benefits are achieved by applying appropriate doses, and those duly permitted under the Prevention of Food Adulteration Act (PFA) Rules, 1955, can be processed by radiation.
The radiation processing facilities are environment friendly and are safe to workers and public around


Interestingly, Bhabha Atomic Research Center (BARC) offers ‘ AKRUTI Technology Package for Rural development’ which provides infra and knowhow for radiation facilities.

Food processing seems to have promising future, provided adequate government support is there. Food is the biggest expense for an urban Indian household. About 38 % of the total consumption expenditure of households is generally spent on food. This share is declining consistently. As mentioned, food processing has numerous advantages which are specific to Indian context. It has capacity to lift millions out of undernutrition. Government has challenge to develop industry in a way which takes care of small scale industry along with attracting big ticket domestic and foreign investments.

Contemporary Developments in Business and Management

Agricultural production in India is an important determinant of overall economic growth and a huge employer of the rural populace. Total food grain production, for instance, in 2004/2005 (April-March) amounted to 206.4 million tones, including 87.8 million tones of rice and 73.0 million tones of wheat (Country Report, 2005). However, yields per hectare remain low by international standards. Other major crops grown include oilseeds, cotton, pulses, sugar, tea, coffee, rubber, jute and potatoes. The recent slowdown in the sector is a cause for concern and calls for a change in the government’s agricultural policy. Some academic research suggests that in order for India to sustain GDP growth of around 7 percent or more, agriculture has to grow at, or in excess of, 4 percent (India Economic Survey, 2004; Sinha, 2005; Nilekani, 2006).

The following management report attempts to analyse the agriculture sector in India, assessing the affect of external and internal factors on the industry. SWOT analysis framework is employed to give a more in-depth strategic insight into the sector’s current development, emphasising its internal strengths, weaknesses, and external opportunities and threats. The application of PEST analysis involves the assessment of industry’s external environment of political, economic, social and technological conditions that have a direct impact on the performance of the industry and its future development. The significant part of the report is also devoted to the critical evaluation of ecological factors impacting the agricultural sector, examining industry’s responses and improvements for its sustainable growth.


2.0 Indian Agriculture Industry Overview
2.1 SWOT Analysis

2.1.1 Strengths

  • The Indian agriculture is large, competitive and well developed, offering products at low prices. The sector experiences a constant demand, as Indians have a strong preference for fresh rather than processed foods and for local spices and ingredients (The World Bank, 1997).
  • Provides employment for a large Indian population, living in rural territories.
  • Recent advances in technology and government initiatives support the development of the sector. In pursuance of the government policy to strengthen and promote IT led governance, the department of agriculture and cooperation has been taking various measures to promote the use and application of technology with the aim of making agriculture “online” for the use of farmers, exporters, and traders, etc.

2.1.2 Weakness

  • One of the major weaknesses present for the agricultural sector in India is in the lack of government support. Unlike in East Asian countries, the shift of the labour force from agriculture to non-agriculture in India is peculiarly slow, largely attributable to rigid labour laws in both the agricultural and industrial sectors. Gliessman (1989) also highlights the need for pressing on with reforms in agriculture, in particular, trade liberalisation and export promotion strategies. Becker and et al. (1992) also claim that though India spends on agriculture nearly twice as much as some East Asian economies, this level of spending on agriculture does not translate into a significantly higher sectoral performance.
  • Inadequate road linkages also remain a major constrain for the development of well-functioning agricultural markets. A continuing fragmentation of land-holdings, poor maintenance of existing irrigation systems and declining soil fertility in some areas are other factors.
  • Another weakness is based on seasonality and the fact that agricultural sector output heavily depends on the annual monsoon, as less than one-third of cropland is irrigated. The main foodgrain crops, for example, and some cash crops (oilseeds, cotton, jute and sugar) depend on the south-west monsoon (This brings 80% of India’s rain, usually within a three-month period from June to mid-September. The 2002 south-west monsoon was disastrous, causing the autumn grain harvest to fall by 18% year on year. In 2004 the sector stagnated in comparison to the previous year when the best monsoon rains in a decade generated growth of around 10% in the agricultural sector. Excessive rainfall in 2005 caused severe flooding in Maharashtra (The Economist Intelligence Unit Report, 2005a)).

2.1.3 Opportunities

  • A growing population, rapid economic development, and political and social demands exceed the mandate and capabilities of any corporation in an emerging economy (Bhagwati, 1998), and India is no exception to this. A growing population has made industrial development one of the Indian government’s highest policy priorities; it is an important element of economic development as it assists in raising national income at a more rapid pace. It is also a precondition for continued agricultural development.
  • Palmer-Jones and Sen (2003) state that the government continues to play a major role in assisting farmers through agricultural credits, subsidies, price support schemes and extension services. Although there are no food security concerns at present, better agricultural productivity will hold the key to stable growth in food production, given the limits of the resource base. There is an opportunity for the economic growth to benefit more people only if the country raises agricultural productivity, improves its system of general education to help the millions who must leave farming, and encourages labor intensive manufacturing industries.

2.1.4 Threats

  • About one-fifth of the country, 69m ha, is covered by forests and woodland, and one-half of this area is reserved for the production of timber and other forestry products (Varshney, 1998). However, there are increasing concerns from environmentalists and local government over the rapid depletion of forest areas, ecological factors, and scarcity of natural resources.
  • As income rises, India is becoming an increasingly important market for processed foods, especially in the cities and among young people. Aware of quality and international brands, consumers are less likely to support national products, and are more vulnerable to pay premium prices for foreign products of better quality. This represents a potential substitution to the local products, impacting the production levels of agriculture sector.
  • Food support prices for wheat and rice have given farmers little incentive to diversify and have filled government storage facilities to overflowing, while keeping the market price of foodgrains artificially high. Current agricultural policy, which supports cereal production, is exceedingly expensive and will be unable to deal with the likely scenario of a shift in consumption from cereal food towards non-cereal food. A lack of market infrastructure also hampers the movement of crops, leading to sudden shortages. India has considerable potential as an exporter of rice, cotton, many types of fruit and even flowers, but this has so far not been tapped (Yeoh and Siang, 2006).
  • The introduction of high-yield crop varieties and new fertilising and irrigation techniques over recent decades – the so-called Green Revolution – dramatically increased productivity in some regions. India has been self-sufficient in food since the mid-1970s, maintaining buffer stocks adequate to meet demand despite failed harvests and seasonal fluctuations (Ramakrishnan, 1993; The World Bank, 1997).

2.2 PEST Analysis

2.2.1 Political
India is a parliamentary federal democracy with an indirectly elected president, Adbul Kalam. The economic liberalisation of 1991, initiated by then Indian Prime Minister P. V. Narasimha Rao and his finance minister Manmohan Singh in response to a macroeconomic crisis did away with the Licence Raj (investment, industrial and import licensing) and ended public sector monopoly in many sectors, thereby allowing automatic approval of foreign direct investment in many sectors, including agricultural. Since then, the overall direction of liberalisation has remained the same, irrespective of the ruling party at the centre, although no party has yet tried to take on powerful lobbies like the trade unions and farmers, or contentious issues like labour reforms and cutting down agricultural subsidies. The process of reducing or removing agricultural and food subsidies, which is still ongoing, was commenced. Tariff and non-tariff barriers to external trade were also reduced.

Realizing the importance of Indian agricultural production for economic development, the central Government of India has played an active role in all aspects of agricultural development. Planning is centralized, and planned priorities, policies, and resource allocations are decided at the central level. Food and price policy also are decided by the central government. Thus, although agriculture in India is constitutionally the responsibility of the states rather than the central government, the latter plays a key role in formulating policy and providing financial resources for agriculture. The main objectives of the Government’s price policy for agricultural produce, aims at ensuring remunerative prices to the growers for their produce with a view to encourage higher investment and production. Minimum support prices for major agricultural products are announced each year which are fixed after taking into account, the recommendations of the Commission for Agricultural Costs and Prices (CACP). For example, the Government of India has also approved proposals for joint ventures, foreign collaborations, industrial licenses and 100% export in or with the agricultural sector, envisaging an investment of over $ 18.2 Billion (Agbola, 2004).

One of the most critical obstacles of policies applications in agricultural sector is in ensuring food security – access of the population to sufficient food to meet nutritional requirements. Food security issues tend to cover not only issues related to availability and stability of food supplies but also issues of access to this supply. This last is related to the resources needed to procure the required quantity of food. However, these issues in India are considered to be sensitive and hence, where a large percentage of the population is dependent on agriculture need a certain degree of autonomy and flexibility in determining their domestic agricultural policies. The Economist Intelligence Unit Report (2005) also implies that the government does not fully understand its importance. These would have to be geared towards improving productivity, enhancing income levels, reducing vulnerability to market fluctuations ensuring stability of prices and so on.

2.2.2 Economic
India is a two-tier economy, with a cutting-edge and globally competitive knowledge-driven service sector that employs the brightest of the middle classes on the one hand, and a sprawling largely rain-fed agricultural sector that employs the majority of the vast and poorly educated labour force, on the other. The agricultural sector, with fishing and forestry, accounts for around 20% of GDP, services 53% and manufacturing 27%. Agriculture represents an important economic activity for a large population of the developing world India’s agricultural sector provides employment for about 60% of the country’s workforce and accounts for one-fifth of GDP (Meisinger, 2006). Both in terms of foreign investment and number of joint- ventures / foreign collaborations, the consumer food segment has the top priority. The other attractive features of the Indian agro industry that have the capacity to lure foreigners with promising benefits are the deep sea fishing, aqua culture, milk and milk products, meat and poultry segments.

The serious foreign-exchange crisis in 1990 led to a number of well-publicized economic reforms in the early 1990s dealing with trade, industrial licensing, and privatization. The reforms had an impact on the agricultural sector through the central government’s effort to withdraw the fertilizer subsidy and place greater emphasis on agricultural exports. The cut in the fertilizer subsidy was a result of the government’s commitment to reduce New Delhi’s fiscal deficit by removing grants and subsidies from the budget. The government action led to a reduction in the use of chemical fertilizers and protests by farmers and opposition from political parties. The government was forced to continue the subsidies but at a somewhat lower level (Yeoh and Siang, 2006).

Agricultural exports from India were 44 percent of total exports in FY 1960, decreasing to 27 percent in 2003 (India Economic Survey, 2004). This drop in agriculture’s share was somewhat misleading because agricultural products, such as cotton and jute, that were exported in raw form in the 1950s, have been exported as cotton yarn, fabrics, ready-made garments, coir yarn, and jute manufactures since the 1960s. The composition of agricultural and allied products for export from India changed mainly because of the continuing growth of demand in the domestic market. This demand cut into the surplus available for export despite a continuing desire, on the part of government, to shore up the constant foreign-exchange shortage (Edward, 2006).

Over the period 1994-2005, the drive for market liberalization and globalization has severely imposed on the rural household economies. The traditional mode of agricultural practice has been destroyed. The government allocations on the agriculture sector constantly register a decline (The Economist Intelligence Unit Report, 2005). The recent economic system giving a free hand to multinational corporations in agriculture sector has further caused a rapid shrinkage of the traditional practices and replacement of folk crop varieties with high yielding and hybrid varieties, which escalated the cost of agricultural production while stagnating productivity. The farm credit system in Indian agriculture, evolved over decades has been instrumental in enhancing production and marketing of farm produce and stimulating capital formation in agriculture. Credit for Indian agriculture has to expand at a faster rate than before because of the need to step-up agricultural growth to generate surplus for exports, and also because of change in the product mix towards animal husbandry, aquaculture, fish farming, horticulture and floriculture, medicinal plants, which will necessitate larger investments.

2.2.3 Social
Since its independence in 1950s, foreign aid has made a significant contribution to the agricultural progress in rural India. Increasingly since independence, India has been sharing its agricultural technology with other developing countries. Numerous foreign scientists have received special and advanced training in India; hundreds of foreign students have attended Indian state agricultural universities. In the late 1980s and early 1990s, India provided short and long-term training courses to hundreds of foreign specialists each year under a variety of programs, including the Technical Cooperation Scheme of the Colombo Plan for Cooperative Economic and Social Development in Asia and the Pacific and the Technical Cooperation Scheme of the Commonwealth of Nations Assistance Program.

India is one of the oldest civilizations with a kaleidoscopic variety and rich cultural heritage. During the period of 55 years independence, it has achieved multifaceted socio-economic progress and is now the tenth industrialized country in the world and the sixth nation to have gone into outer space to conquer nature for the benefit of the people. However, those people employed in agricultural sector, are those less educated, living in rural areas. More than 60% of the India’s population is dependent on the agriculture (Palmer-Jones and Sen, 2003). The last ten years of development in the agriculture sector in India, show that the lower government investment in agriculture and market driven system has adversely affected the livelihood of rural India. Nilekani (2006) suggest that in India a majority of the farmers come under the category of small and medium farmers and are solely dependent on the local market rather than international market. The prices of their product are determined by local variables rather than international markets, so the trade liberalization may lead to an adverse impact on the Indian agriculture sector and women may suffer.

Large numbers of women are engaged in agriculture, primarily in the production and processing of food. With male-selective migration from rural areas on the increase, women are often left behind to take care of both family and the farm on their own. According to the 2001 census, 27.5 percent of cultivators in the rural areas are female, while in the case of agricultural labour, as much as 46.9 percent are women. Of the rural workforce, an overwhelmingly large proportion, i.e., 80% are employed in the agriculture sector. About 36.5% (40.6 million) work as cultivators on their own/family landholding, while about 43.4 percent (48.4 million) are engaged as hired agricultural labour (Palmer-Jones and Sen, 2003). It is, therefore, obvious that women play no small role in food production. In other words the mode of female participation in agricultural production varies with the land owning status to farm household. Women’s roles range from managers to landless labour. Also, as globalization shifts agriculture to capital and chemical intensive system, women bear disproportionate costs of both displacement and health hazards.

2.2.4 Technological
The last few decades have witnessed a visible transition in the industrial landscape of India. Technology has helped society to cut across the traditional boundaries for getting converted into an emerging information society. The Government’s long-term vision on “Information and Communication Technology (ICT) in the Agriculture Sector” aims to bring farmers, researchers, scientists and administrators together by establishing a system known as “Agriculture Online” for the exchange of ideas and information. A land information system has already started using geographic information systems (GIS) and remote sensing to help the farmers to plan their activities and facilitate decision-making and planning at the local level (India, 2004). Farmers can find out the chemical composition of their land through lab testing to know how fertile their land is and what should they grow to make maximum profits.

Achievements of Indian agriculture supported by technology like development of High Yielding Varieties (HYV) of seeds, new hybrids of different crops, research in the area of vaccine production, varietal development through somoclonal variations, developing better quality products and transgenic in crops such as brinjal, tomato, cauliflower and cabbage have strengthened the field. In 21st century agriculture, application of modern biotechnologies like DNA finger printing, tissue culture, terminator gene technology and genetic cloning will hold the key in raising the productivity (Ghosh, 2003). Also considering the irrigation needs in Indian agriculture, emphasis has to be given to promote the proven cost-reducing micro-irrigation technology of drips irrigation which helps conserve water reduces fertilizer inputs and ensures higher productivity.

With all the benefits that technology can provide, there is an important issue of providing sufficient and appropriate education for the labour to increase their skill sin technology application that could be beneficially used for agro sector.

3.0 Ecological Factors Analysis
Agriculture, forestry and fisheries are traditional activities in the rural environment of India. Forest conversion has been accelerated by activities associated with rapid industrialization, such as mining and energy generation through large hydroelectric projects. Nevertheless, much conversion is still due to the extraction of timber for industrial uses and to meet the needs of the rural poor in terms of food, fodder and firewood. In India, lakes and rivers are an integral part of human settlement and the water is being used for drinking, aquaculture, fishing and agriculture purposes. These freshwaters are under considerable threat owing to the fast pace of modern technology, industrialized and increased population densities. Industrial, agricultural, aquacultural, transportation and other human activities like burning of fossil fuels and disposal of solid and domestic waste deteriorates the air and water quality of the lakes.

The concept of economic development has been changing over a period of time. In the early 1980s a new concept of development had emerged as a reaction to the negative experiences of development, which is known as “sustainable development”. The concept “sustainable development” may be interpreted to mean a certain pace of development which can be sustained even in the long run. Since development is a process, sustainable development is also a process in which the economic and social welfare of the people can be maximised with minimum damage to ecology and the environment (Brookfield and Padoch, 1994). As in the case with India, the concern for the environment and its protection was totally absent in the official policies from the very beginning of the planning programmes (Ramakrishnan, 1992; Swift and et al., 1994). The environmental policies of the Government were initiated with the setting up of the National Committee on Environmental Planning and Co-ordination in 1972 and the creation of the Environment Department in 1980. Gliessman (1989) states that since the 1980s, a number of legislative measures were adopted for the preservation of the environment but they largely remain ineffective. However, in recent years, much concern has been expressed about the alarming rate of deforestation which has occurred. Although 22.86 percent of the total geographical area in India has been declared as forest area, Brookfield and Padoch (1994) claim that the actual forest covers to be as low as 19.46 percent, of which, the good forest cover is only around 10 percent of the total land area (Agbola, 2004). In fact, much of the good forest area is located in the north-eastern region of India, where 65.19 percent of the total geographical area is covered under forests, representing around 25.97 percent of India’s forest area based on satellite imagery (Agbola, 2004).

Soon after the Stockholm Conference on Human Environment in 1972, India developed its own environmental control system, laws and policies. The first of India’s modern environmental laws were the Water (Prevention and Control of Pollution) Act of 1974, which established the Central and State Water Pollution Control Boards, The Air (Prevention and Control of Pollution) Act of 1981 and the Environment Protection Act of 1986 (Agbola, 2004; Country Report, 2005). The latter is an umbrella legislation designed to provide a framework for the central government. However, in such an undeveloped country such as India, the contribution of pollution and ecological regulations is weak, partly due to ineffective measures adopted or the lower relative value placed on the ambient quality of life. The mandate of the Central Pollution Control Board (CPCB) is to set environmental standards for all plants India-wide, lay down ambient standards and co-ordinate the activities of the State Pollution Control Boards (SPCBs). Unfortunately, the implementation of environmental laws and their enforcement is decentralised and is the responsibility of the SPCBs (Agbola, 2004), and hence not subject to scrutiny by the CPCB. This is an ad hoc method of addressing key environmental issues. In addition, the pollution control laws have achieved little success. Slow responses by the courts to enforcement actions sought by SPCBs, poor funding of the boards themselves, and charges of corruption have been regular and widespread.

As it was mentioned earlier in the report, agriculture in India is an important economic activity for a large population. Indian “green revolution” is largely confined to a small section of the rural society and has had positive repercussions in terms of general self-sufficiency in food production (Palmer-Jones and Sen, 2003). But this has had its negative impacts too. First, this energy intensive activity is still confined to a small sector of the predominantly agricultural society. Vast sections of the rural communities are left out, leading to wide disparities in access to resources and income generation arising out of effective use of natural resources using affordable appropriate technology. More and more farmers have been marginalized in spite of overall self-sufficiency in food production. This is apart from the difficulties faced at India’ national level to have access to non-renewable resources like petro-based chemical fertilizers and pesticides to sustain the “green revolution” itself in the face of increasing population pressure and to cope with the larger problems of environmental degradation caused by excessive and uncontrolled use of water and chemical subsidies.

Nevertheless, on the local level there are few examples of effective responses from the individual farmers with a regard to biodiversity and ecosystem functions. According to Brookfield and Padoch (1994), through the mixed cropping involving a large number of species and traditional weed management strategies, the shifting agricultural farmer of North-East India ensures effective checks on nutrient loss during the cropping phase. The emphasis is on cereals, which are largely placed towards the base of the slope as they are less nutrient-use efficient, while the more nutrient use-efficient tuber crops are placed towards the top of the slope where soil fertility levels are low. Under shorter ten or five year cycles, the cropping pattern shifts with emphasis on tuber crops (Ramakrishnan, 1995). This indeed is an elegant example of adaptation towards optimization of resource use and risk coverage, through manipulation of biodiversity, by the humans within the ecosystem.

Within a given landscape, the tribal farmer of India also has a variety of land use systems contributing towards biodiversity at all levels ranging from the sub-specific, through the species, population and the ecosystem (Ramakrishnan, 1992; Palmer-Jones and Sen, 2003). Thus, as Swift and et al. (1994) state, apart from the diversity in cropping patterns within the shifting agriculture systems that he maintains, he may have fallow systems, sedentary systems on hill slopes, wet rice cultivation on valley lands involving a variety of rice cultivars and a whole variety of tightly packed home gardens resembling a forest, where the farmer grows perennial trees and shrubs of economic value along with herbs and vines. These mosaics of ecosystem types of the landscape perform a variety of functions towards the integrity of the system as a whole, while having a variety of service functions for the humans (Venkateswaran 1992). Indeed, these indigenous farming practices indicate the effort of individual farmers for conserving resources.

For improving the system of land use and resource management in India’s agricultural sector, the following strategies can be suggested:

  • With wide variations in cropping and yield patterns practised by over 100 tribes under diverse ecological situations, where transfer of technology from one tribe/area to another alone could improve the valley land and home garden ecosystems (Palmer-Jones and Sen, 2003). Thus, for example, emphasis on potatos at higher elevations compared to rice at lower elevations has led to a manifold increase in economic yield despite low fertility of the more acid soils at higher elevations.
  • Redesign and strengthen the agroforestry system incorporating ecological insights on tree architecture (e.g. the canopy form of tree should be compatible with crop species at ground level so as to permit sufficient light penetration and provide fast recycling of nutrients through fast leaf turnover rates).
  • Condense the time-strong of forest succession and accelerate restoration of degraded lands based on an understanding of tree growth strategies and architecture, by adjusting the species mix in time and space (Brookfield and Padoch, 1994).
  • Improve animal husbandry through improved breeds of swine and poultry.
  • Redevelop village ecosystems through the introduction of appropriate technology to relieve drudgery and improve energy efficiency (cooking stoves, agricultural implements, biogas generation, small hydroelectric projects, etc.). Promote crafts such as smithying and products based on leather, bamboo and other woods (The Economist Intelligence Unit Report, 2005b).
  • Strengthen conservation measures based on the traditional knowledge and value system with which the tribal communities could identify, e.g. the revival of the sacred grove concept based on cultural tradition which enabled each village to have a protected forest once on a time, although few are now left.
  • Economic (monetary output/input analysis, capital savings or asset accumulation and dependency ratio), social (quality of life with more easily measurable indicators such as health and hygiene, nutrition, food security, morbidity symptoms; the difficult to quantify measures such as societal empowerment and the less tangible ones in the area of social and cultural values).

4.0 Conclusion
From the above research it is evident that agricultural sector represents one of the most significant sectors of the economy of India. Therefore, its prospective growth has to be one of the primary objectives of the government development plans. The current state of the agricultural sector is a cause for concern and calls for a change in the government’s agricultural policy, indicating not only a greater restructuring of the public spending and more government funds, but also an integrated tolerant approach to farming, ecological concerns and future growth prospects. However, it still represents a big challenge for the industry; (though the industry has seen some policies and regulations) there is still a gap between the intent of these environmental policies and the actual development.

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