Four organizations, viz Nafed, National Horticulture Mission, the Small farmers Agribusiness consortium and FICCI have invited the stakeholders engaged in the entire value chain of production of fruits and vegetables – from the farm gate to the kitchen –to sit across the table (which is not really round) , and discuss the modalities of ensuring that good quality fruits and vegetables can be reached to the consumer .The immediate context is of course the recent announcement of the Rs 300 crore special packages for vegetable initiative for urban clusters under the window of the Rashtriya Krishi Vikas Yojana, about which a reference had been made in last week’s column as well. However the issues that the Roundtable will take up have been germane for quite some time in the past , but perhaps the ‘tipping point ‘ had not been reached. The unprecedented food inflation in the first few weeks of January was probably the trigger !
Great Expectations !
NHM (National Horticulture Mission )
First things first. AgriMatters will examine the perspective of the four organisations that have come together to put this Roundtable together. The NHM wants that the production clusters which are currently supplying vegetables to the urban areas can be identified and organized. Identification and organization is important for several reasons- the first and foremost being that as of now, there is no authentic data on where and how the vegetables are being produced, the terms on which they are accessing informal/institutional credit, their links with the intermediaries, the supply of planting material, the logistics of transport, price discovery, the extent of fertilizer and pesticide/insecticide use. NHM has funds to make necessary interventions in the entire production chain – from pre-planting to post harvest management – but is finding it difficult to reach out to the farmers because the majority of them are marginal and small, and in the absence of an institutional support mechanism, reaching out to them is difficult. NHM wants organisations like SFAC and NAFED to support the establishment of farmers co-operatives or Self Help groups or Joint Liability groups to reach out to the farmers , and work with them on enhancing production and profitability, GAP certification , organic practices and primary level value addition through sorting, grading and farm level storage. India’s horticulture production is globally competitive – but its primary producers are not getting equitable or fair returns – both on account of information asymmetry and inability to access technology and services in the value chain.
NAFED (National Agricultural Co-operative Marketing Federation )
As the apex agri marketing co-operative in the country, NAFED wants to break the stranglehold of the intermediaries who are holding both the producers and consumers to ransom. A typical agricultural market yard allows only those who have a physical shop to receive agriculture produce and auction it, again among the closed group. A person who is not a member of the market yard is allowed to compete. Even at the peak of the onion crisis, when Nafed was making price interventions in NCT of Delhi, the Okhla sub market of Azadpur Mandi refused to give a shop/auction platform for organising the sale of onions, which could have brought down the costs for the consumers of South Delhi. The logic extended was that all the 198 shops in the Okhla Mandi had been allotted by DDA to the traders who had been relocated from Daryaganj in 1987, much like the 1500 odd traders who are in Azadpur after their relocation from the Bara Hindu Rao area during the Emergency. However, in the last decade, mobile phones, internet, multi commodity exchanges, cold chain logistics, legislation for warehouse receipts, consumer awareness, entry of retail chains in the F&V space, newer and more stringent regulations with regard to health and safety call for a change in the way this trade is organized. Nafed wants to play a lead role in the organization of the new markets in which the farmers organizations ,primary and secondary level aggregators , organized retail, consumers’ organizations and vendors ‘consortia – all have an access – and where trading rights are not given away in perpetuity to a select group of traders who enjoy political patronage and the ability to manipulate prices. Nafed’s experience with existing markets has not been positive – the terms of trade are non-transparent and opaque and it is not possible for any large scale operation which wants to maintain legitimate accounts to transact in these markets.
SFAC (Small Farmers Agribusiness Organisation )
The Small Farmers Agribusiness Consortium – which now calls itself the Small farmers Agribusiness Champion – is a unique organization which provides venture capital, and supports new technologies and ideas besides giving thrust to the organisation of farmers groups to help them access the entitlements due to them. SFAC is now supporting the National Food Security Mission and the National Horticulture Mission in organising farmer’s clusters for ensuring the reach of the programme features and benefits to the farmers. Unlike Nafed, it is not bound in its mandate to focus primarily on co-operatives. Thus SFAC is not only supporting the formation of farmers’ clusters, but also ensuring business partnerships with aggregators and retailers to ensure that marketing and value addition services.
FICCI(Federation of Indian Chambers of Commerce and Industry)
Where and how does FICC I come into the picture? FICCI is the organisation of Indian industry – what is it doing in the agriculture space? The answer is that most agribusiness organisations and organised retail chains are now realising that unless they can work directly with farmer’s organisations, they will not be able to deliver the best value to their consumers. Many new technology firms and service providers in the domain of traceability, GAP and organic certification are also looking for a platform to connect with the farmers’ organisations. FICCI also understands that to break the stranglehold of the existing intermediaries in the extant system calls for collaboration and co-operation with other stakeholders. Most of the large aggregators, food processors, cold chain equipment manufacturers and service providers are members of this organization, and have been pressing for reform in the agri- marketing space because of the growing purchasing power of urban households and their insistence on quality, consistency and traceability.