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agricultural export policy

Agricultural Export Policy

Agricultural Export Policy

The Agricultural Export Policy was introduced to increase and provide support to productivity, pre and post-harvest management, value-addition and upgrade technology. The policy was introduced after the stagnant agricultural trade in the international market from 2013-2017. The decline of agricultural commodities reduced GDP and other economic affairs. To make major reforms to the export policy for agriculture, India restructured from the Green Revolution Era and promoted Agricultural Export Policy to diversify the food and non-food agriculture base to emerge as a leading player in the world in agricultural trade. The policy would increase the agricultural exports leading to stable growth in GDP, benefits for farmers, employment in rural areas, quality and scope for value addition and future market potential.

The Agricultural Export Policy shall address the following areas to increase the exports in agriculture:

  • Changes in the food patterns
  • Increasing unstable incomes
  • Shrinking farming area
  • Changing socio-economic, agro-climatic and dietary patterns
  • Transportation and Infrastructure
  • Post-harvest losses
  • Generating employment
  • Minimising the loss in the value chain

Vision of the Policy

To utilise the potential of Indian Agriculture and emerge as a global power in agriculture through a suitable framework and policies.

Objectives of the Policy

The policy has a twin objective to increase the Agriculture export

  • To create a stable trade policy regime
  • To double the agricultural exports to 100 Billion USD by 2022
  • Diversify the export base and increase the high value and value-added agricultural exports
  • Promote ethnic, traditional, organic and non-traditional agri products
  • Create a platform to provide a mechanism for better market access to deal with sanitary and phytosanitary issues
  • To increase India’s share in the world agri exports by integrating with international value chain
  • Create a framework to support farmers to increase benefits and opportunities in the overseas market

Policy Framework

The Agricultural Export Policy recommendations are in two categories, they are:

S. No.

Category

Features

 

 

1

 

 

Strategic

Policy Measures
Support for Infrastructure and Logistics
Holistic Approach to Increase Exports
Involvement of State Governments in Agriculture Exports

 

 

 

 

 

2

 

 

 

 

 

Operational

Focus on Clusters
Promoting Value-Added Exports
Promoting and Marketing ‘Brand India’
Establishing Strong Quality System
Attract Private Investments into Production and Processing
Research and Development
Miscellaneous

Strategic Recommendations

Policy Measures

The Department of Commerce (DoC) shall hold regular discussions with the public and private stakeholders to increase agricultural exports through the agricultural value chain. The DoC shall highlight on the measures to be initiated to gain better access to the international market and the need for increasing the quality of commodities to create a stable and trusted market chain. The DoC will focus on creating policies to attain short term goals to reduce inflation, domestic price and production volatility of certain agricultural products. The measures for the reduction can be implemented by maintaining price stability or imposing Minimum Support Price (MEP) and redirecting resources towards products that provide higher returns.

The Policy aims at:

  • Providing assurance that the processed agricultural products shall not be brought under the export restrictions (MEP, export duty, export bans, export quota,
  •  capping and export permit)
  • Any situation related to extreme pricing or restrictions shall be discussed with the World Trade Organisation (WTO)
  • Liberalisation in the import of agricultural products for value addition and re-export
  • Reform the policy by using the Directorate General of Foreign Trade (DGFT), Export Promotion Councils, Commodity Boards and Industry Associations

Infrastructure and Logistics

To boost the agricultural exports, the Agricultural Export Policy promotes to create a robust infrastructure for developing a strong agricultural value chain. The infrastructure involves the following facilities to increase exports:

  • Pre and post-harvest handling facilities
  • Storage and distribution facilities
  • Processing facilities
  • Roads exit point infrastructure at ports to promote smoother trade
  • Mega Food Parks
  • State-of-the-art testing laboratories and
  • Integrated Cold Chains

Involvement of State Governments in Agri Exports

To increase the export and quality of the production, all the states can make reformation as per the priorities required by the socio-economic, political realities and agricultural nuances. The involvement by the states will extend the support to identify the issue faced by the exporters, organise buyer-seller meet, encourage state-level exporters to participate in international fairs and identify the schemes provided by the State and Central governments to maximise the exports. The Agricultural Export Policy shall also collaborate with State Export policies to include inland and marine fisheries, promoting good agricultural practices, quality assurance system, planning for pre and postharvest infrastructure and food processing industries.

Operational Recommendations

Focus on Clusters

The importance of establishing clusters was emphasised to boost the agricultural and horticultural production in India. The Agricultural Export Policy will focus on the cluster development approach to improve pre and post-harvest management and to upgrade the supply chain to increase production, reach higher levels of export and double the income of the farmers. Through the policy, the central government shall support the State government by providing incentives to increase infrastructure to:

To provide successful implementation of clusters, the policy shall promote Agri Export Zones (AEZ) to enhance value addition and higher exports. Since India has developed Special Economic Zones (SEZ) to create goods at lower prices in Public and Private sectors in specific sectors like IT, Textiles, Pharmaceutical sectors, developing  AEZ can provide opportunities to producing value-added products to certain countries. This can be regulated by the WTO and thus increasing Foreign Direct Investment (FDI) into Agriculture Exports.

Promoting Value-Added Exports

The policy is focused on promoting value-added, indigenous and tribal products as the export has little or no processing or value-added products. To increase the value-added products, research on exportable products with branding shall be implemented. The following  commodities shall be given financial support by the stakeholders to increase the level of exports:

  • Non-forest produce
  • Wild herbs
  • Medicinal plants
  • Extracts
  • Lac and
  • Essential oils
  • Cashew, cashew apple jams and pastes, flavoured cashew

Promoting and Marketing Value-Added Organic Exports

Under the National Programme on Organic Production (NPOP), livestock, aquaculture and organic textile that has the potential for exports are added to boost the value-added organic exports. Agricultural and Processed Food Products Export Development Authority (APEDA) shall implement the need to increase the export production, product registration and support for buying shelf in the organic sector. APEDA shall act as a nodal organisation for NPOP to implement and enhance organic export products.

Private Investments in Export-Oriented Activities and Infrastructure

Export volumes and the quality of the product can be increased by post-harvest infrastructure. The post-harvest infrastructure will enable a better price realisation and creates a smooth logistical movement of agricultural products. The benefits of post-harvest infrastructure are:

  • Better quality compliance
  • Facilitates smooth logistic handling
  • Expansion to distant markets
  • Cold storage
  • Exit Point Infrastructure

Ease of Doing Business

The policy shall provide support for smooth business operations by digitalising farmer records, geo-mapping of lands, registration of farmers and farm producer organisations, registering land records and linking the land details with Aadhaar. This will help to eradicate misuse of public funds, establishing traceability and promote farmers’ presence in the global market. A dedicated portal such as ‘agri exchange portal’ and `fish exchange portal’ shall be operated by the DoC to enhance market leads at the international market through the Indian Embassy. Manual of Importing Country Requirements (MICOR) will be developed enquire or create requirements for all the major agricultural products to avoid rejection.

The DoC has proposed to create a single portal to provide a facility for single accreditation of labs and prevent different organisations from carrying out accreditation activities separately. It shall also address the issues relating to export market access.

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Peter is a Senior Content Writer and Copy Editor in Finance specializing in GST and Import & Export. He has also written articles on Medical, Philosophy, and Literature and published research papers in international journals.

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