Farm Exports in India

Farm Exports in India

News: India’s agricultural exports have fallen 11.6% year-on-year in April-September. It comes on back of government imposing bans/restrictions on the shipments of various commodities – from wheat and rice to sugar – and global prices easing from their peaks scaled immediately after Russia’s invasion of Ukraine.

Important Data:
• According to Department of Commerce data, exports of farm commodities, at $ 23.6 billion in AprilSeptember 2023, were below the $26.7 billion for April-September 2022.
• The country’s farm exports touched all-time highs of $50.2 billion in 2021-22 (April-March) and $53.2 billion in 2022-23, reversing a declining trend from 2013-14 to 2020-21. 2021-22 and 2022-23.

What concerns does it raise for farmers?
• Declining international prices not only lower the cost competitiveness of the country’s agricultural exports, but also make its farmers more vulnerable to imports. It is being witnessed in cotton and edible oils.
• Ahead of National elections taming food inflation will be top priority and the interests of consumers will be favored over those of producers which means cheaper imports shall continue to dominate and restriction on exports will be seen especially in cereals, sugar and onion.

What other challenges does India’s Agricultural exports face?
• Lower per capita productivity due to Land fragmentation, low mechanization and absence of economies of scale.
• Share of processed food in agricultural export basket is 16% as compared to 25% of USA and 49% of China.
• Weak export competitiveness due to post production issues such as – Lack of post harvest storage infrastructure, lack of marketing and branding and lagging on global sanitary and phyto-sanitary standards.
• Inconsistent government policies – For example, continued interference as seen in case of ban on export of wheat (2022), prohibition on export of rice (2022), levying export duties and Minimum export prices etc.
• Global Factors – Russia-Ukraine war, inflation etc.

What are the government of India initiatives to promote Agricultural exports?
• Agriculture Export Policy (AEP): Announced in 2018, the AEP focuses on agriculture export-oriented production, export promotion, better farmer realization, and synchronization with the policies and programmes of the Government of India. The policy emphasizes a farmer-centric approach.
• Agricultural and Processed Food Products Export Development Authority (APEDA): APEDA, which operates under the Ministry of Commerce and Industry, has taken initiatives that have helped India achieve 84 percent of its total export target for the year 2022-23 in just nine months of the current fiscal.
• Agri Export Clusters: The government is encouraging the development of agri-export clusters under public-private partnerships.
• National Program for Organic Production – Encourage organic production, processing and exports.
• SAMPADA Yojana – Scheme for Agro-marine processing and development of Agro-processing clusters.
• One lab one assessment portal – Eliminates multiple assessment by multiple authorities.
• Agri Udaan program