Budget 2022: Incentivise horticulture exports; build its competitiveness through infra at ports, railways

Globally, there is a rapid transformation in changing lifestyles of the populace, their food habits, and focus towards not only eating quality food but also adequate nutrients to promote health. India is the second-largest producer of fruits and vegetables, and horticulture is a sector with huge export potential. Horticulture accounts for 33 percent of India’s agricultural GDP from a mere 18 percent of the total cropped area. With rising domestic and global per capita incomes, as well as increasing health consciousness, there has been a growing demand for nutritious, quality and relatively more expensive horticulture produce.  In this setting, India is well placed to become a top horticulture exporter owing to its comparative advantage in terms of production volumes, as well as its diversified agro-climatic zones producing a gamut of fruits and vegetables. Nevertheless, it is yet to develop an adequate competitive advantage in value chains and processed product exports, given its potential. For instance, much of the world’s banana is produced in India, however, we account for approximately 2 per cent of the global market share in banana exports. In the past decade, India’s revolution in the horticulture sector has been the outcome of the intense efforts of the government in this sector. Increased Budget allocation, as well as technology adaptation in the horticulture sector, has led to a situation wherein horticulture production has virtually surpassed agriculture production in the country. The Mission for Integrated Development of Horticulture (MIDH) has contributed immensely towards the adoption of modern technologies for the development of Indian horticulture. To further promote and for holistic growth of the sector in the country, the Ministry of Agriculture and Farmers Welfare has provided an enhanced allocation of Rs 2,250 crore for the year 2021-22 under the MIDH, a centrally sponsored scheme. A recently launched Cluster Development Programme is being implemented by the National Horticulture Board to leverage the geographical specialisation in horticulture clusters and foster the integrated and market-led development of horticulture focusing upon the range of value chain activities including pre-production and production, post-harvest infrastructure and value addition, as well as logistics, marketing and branding. The programme is being implemented as a Pilot Phase initially in 12 identified clusters and will be scaled up to cover all identified 55 clusters based on the learnings from this pilot. The programme will include interventions in three verticals i.e. pre-production and production, post-harvest infrastructure and value addition, logistics, marketing and branding. Upon successful implementation of the programme in all clusters, the overall outcome is envisaged by way of benefiting around 1 million farmers, leveraging a total estimated investment of Rs 10,000 crore, and enabling an increase in exports of the targeted crops by 20 percent. Policy intervention sought to boost horticulture produce The expectation from Budget 2022 is to suggest policy interventions that shall boost the export of horticulture produce from current levels of approximately 1 percent of production to 10 percent.  For this transformation, it is suggested to scale up cluster focus programmes that support the development of global competitive horticulture clusters focusing on innovative interventions including digital transformation. Participation of the private sector shall be encouraged and branding of horticulture produce shall be promoted. The Budget is also expected to work on the productivity enhancement of various crops through the availability of disease-free quality planting material through tie-ups with the International and National Center of Excellence, ICAR institutions, etc. Moreover, there are opportunities to lay emphasis on the development of sea protocols for commodities like banana and mango, as well as on favourably orienting bilateral as well as multilateral trade agreements with major markets in the Middle East and the USA. Incentivise horticulture exports The expectations also include a focus on the Budget allocations which can incentivise horticulture exports and build its competitiveness through infrastructure at ports, railways etc. Investment in logistics infrastructure also needs to be promoted with the programmes like Gati Shakti which will build an infrastructure grid for an effective evacuation of marketable surplus. Horticulture with its potential to transform the agriculture sector needs a significant enhancement in budget allocation which is currently approximately 5 percent. With these interventions, it is likely that horticulture production will soon become the preferred choice of the Indian farmer. This will also contribute to the comprehensive development of the India agribusiness ecosystem, exploiting the opportunity for enhanced exports, enhanced income for farmers from the far more remunerative horticulture produce, reducing the prevailing high level of post-harvest losses, and increasing value-addition to the commodity and value accruals to the nation. Kunal Sood is Food & Agri Leader and Partner-Public Sector Consulting; Chirag Jain is Director, Public Sector, Grant Thornton Bharat. Views are personal. Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.