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Country lags behind in value addition to farm produce

Staff Reporter

Exim Bank calls for compliance with food safety standards

KOCHI: Compliance with international food safety measures will ensure growth of agricultural exports, says Sanjay Sarkar, Director of Eximius Centre, Exim Bank, Chennai. He was speaking at a seminar on ``Quality standards and certification requirements for agricultural/food products,'' organised by the bank, in association with the Indian Chamber of Commerce and Industry, here on Friday.

Value addition in agricultural and allied sectors in India was lower than the average of it in developing countries, he said.

From 2002-03 to 2004-05, the average annual growth of India's agricultural and allied product exports at 10.4 per cent was lower than the 21.8 per cent average annual growth for the country's total exports. The share of agricultural and allied products in total exports declined from 20.5 per cent in 1996-97 to 12.7 per cent in 2002-03, 11.5 per cent in 2003-04 and 10 per cent in 2004-05.

India's share in the international food trade was only 1.5 per cent. Value addition in India was low at 7 per cent as against 23 per cent in China, 45 per cent in the Philippines and 188 per cent in the U.K.

Outlining the global trends in the agribusiness sector, he said there was a steady increase in global production of fresh produce, outpacing population growth. Consumption was convenience-driven, with focus on value-added products. The technological changes had its impact on the sector. Food safety standards were being initiated by top retailers. The requirements had become more complex.

The Government was aiming at increasing India's share in the global food trade from 1 per cent to 3 per cent. The market size for processed foods would be about Rs. 13,500 billion by 2015. The share of value-added products in processed food consumption would grow from 38 per cent, valued at Rs. 1,800 billion, to 58 per cent, valued at Rs. 7,800 billion. He said a large number of intermediaries, inadequate infrastructure, low level of mechanisation and fragmentation of land holdings were hurdles in India's progress in the field.

K.M. Appaiah, Emeritus Scientist, Central Food Technological Research Institute, Mysore, dwelt at length on the international food regulation and quality management system in food industry.

Exporters of food products would have to follow Codex standards on food safety, approved internationally, to ensure wider market access. He reminded the exporters that no food was nutritious if unsafe.

G. Mohan Kumar, MPEDA Chairman, said the safety standards acceptable to different countries might vary. Balagopala B. Pai, president of Indian Chamber of Commerce and Industry, spoke.

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