Volume I | Issue 5 | May-2015 | `70
AGRICULTURE
W RLD AGRI ECONOMY FINANCE AND INSURANCE
Echoing Sustainable Environment and Agriculture www.krishijagran.com
AGRICULTURE WORLD AGRICULTURE WORLD Editor Director Sr. Executive‐Editor
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M.C. Dominic Shiny Emanuel M.G. Vasan Dr. K.T. Chandy R.K. Teotia Chander Mohan G.S. Saini Sanjay Kumar Kumud Shukla Neha Sachdeva Ruby Jain Aniket Shina Kanika Chauhan Kiran Kumari Chetram P.S. Saini Farha Khan K.J. Saranya Hrituparna Banerjee Sara Khan Sarla Singh Sarita Singh Jyoti Sharma Megha Sharma Afsana Malik Sujata Gautam Chunki Bhutia Poonam Bishwakarma Nishant Kr. Taak Chander Dev Bhatt Rahul Singh Abdus Samad Sukumar Dalai Ritika Goel Pooja Bisht Aruna Jana Dharmendra Kumar Yogesh Kumar Devendra Singh Prem Kumar Ranjan
D.D. NAIR VP International Business (Russia & CIS Countries) 6 Mikluho‐Maklaya STR, Moscow, Russia 117198 Mob: +7903729 98 30, Off.: +7499501 99 10 Email: ddnair@krishijagran.com
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IN THIS ISSUE Enhancing Agricultural Growth and Rural Income ..........................4 Crop Insurance—The Protec on & Availability: A farmer's Choice............................................................................6 Transforma on@ locusts into fodder..............................................9 RBL Bank aims to be big in Rural & Agriculture Banking Sector............................................................10 House Hold Economy of a Farmer in India....................................13 Breaking the myths surrounding the an GMO Propaganda........19 Halal Exports May Help Russia's Agrarian Sector To Grow............22 Agriculture News...........................................................................25
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Editorial
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ecent NSSO survey shows that 52% of the 90.2 million agricultural households are in indebtedness which is as high as 93% in Andhra Pradesh and 89% in Telangana. The survey also revealed, that majority of the farm households were ignorant of crop insurance schemes. During the Kharif 2012 and Rabi 2013 a li le more than 95% of the paddy and wheat growers and 99% of the sugarcane growers did not go for crop insurance. Under this situa on the ar cle by Dr. Suresh Pal, Head, Agri‐ Economics, IARI, New Delhi highlights the need for infrastructure development like transport and rural electrifica on to improve agricultural produc vity and income. S.S. Saxena, Deputy General Manager of Agriculture Insurance Company of India Limited, New Delhi, in his ar cle on Crop Insurance‐ The Protec on and Availability: A Farmer's Choice provides an overall view of the various insurance schemes like NCIP, MNAIS, WBCIS, CPIS from rabi 2013‐14. Further he highlights AIC's contribu on in ini a ng various insurances like rainfall and weather insurances, crop insurances for Mango, grape, coffee, coconut, rubber, potato, pulpwood etc., besides double trigger crop insurance and Farmer's Loyalty Bonus Program. Locusts are swarming insects moving like and army devouring every vegeta on on its way and has been for centuries from ancient mes onwards a serious pest to the all the crops in many countries in the world. In many countries they have been consumed by people in the Asian‐African countries as good source of protein as it contains 75% in dry weight. The repor ng ar cle “Transforma on of Locust into Fodder” by Darya Kezina highligh ng the possibility of conver ng large quan es of pes lent locusts into high protein animal fodder is a rare innova ve idea animal feed industry which will have global market. Such innova ve ideas and prac ces are most welcome. Manoj Rawat, Head, Agribusiness Group, RBL Bank, highlights the involvement of RBL with 14 lakh customers through 183 branches addressing two key areas of concern such as Financial Inclusion and Food Security. Further he highlights the emerging opportuni es for banks in Rural India to involve in Rural Agri‐Business, Rural Housing, Renewable Energy and Services. The Bank's five pronged approach to increase its relevance in rural India is worth no ng. RBL's models like Retail Agribusiness, wholesale Agribusiness & Value Chain Finance, Commodity Finance and Pledge Finance are praise worthy. Poverty is a prowling beast going around devouring silently majority of the popula on in our glorious Hindustan. Poli cians and armchair academicians with their bellies bulging to suffoca on make a mockery of themselves in defining poverty in various terms from calories to purchasing power parity every me in consonants with interna onal commercial interest and finally to rupees per head per day 26 for rural people and 32 for urban people brushing aside the ICMR recommenda ons and even erasing them from all domains of knowledge including the internet. Basing on the balanced diet recommended by the then (1970's) nonpar san ICMR, Dr. Chandy proposes a simple method of es ma ng the minimum level of net income for an individual or a family to have a decent human life. His ar cle on “Household Economy of a Farmer in India” will make anyone who reads it to realize that the Rs 26 & 32 recommenda on is not enough even for a cow or bullock to feed a day. The biggest enemy to progress of humanity is false rumours spread against scien fic facts as it has been happening at the me of Galileo and Louis Pasteur. It takes hell of a lot me to remove such rumours. Mr. K. Vijayaraghavan, chairman, Sathguru and Regional Coordinator, in his ar cle “Breaking the myths surrounding the An ‐ GMO Propaganda” is an a empt to iron out problems arising from the unfounded rumours being spread against the GMO's as India can be a fer le land for spreading baseless and unscien fic rumours since vast majority of the people are prone to believe more in myths and folklore like stories. His indeed is a 'myth exploding' ar cle. The ar cle on “Halal Exports may help Russia's Agrarian Sector to Grow” by Viktoria Semioshina reminds all the people in agrarian the importance of cer fica on in agri‐business ci ng the example of Russia in halal market. The details of the procedural aspects of obtaining a cer fica on and expansion of the market to the interna onal arena presented by the author is an incen ve to people who want to enter into agri‐business. M C Dominic Editor‐in‐Chief editor@krishijagran.com
AEFI Enhancing Agricultural Growth and Rural Income
Enhancing Agricultural Growth and Rural Income
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ndian agriculture has shown impressive growth during the recent past and all the signs are poin ng to a con nua on of this trend in future also. But deficit rainfall during the last kharif season and widespread crop damage due to adverse weather condi ons in this rabi season have slowed down the growth process, which may further deteriorate in the likelihood of deficit rainfall in this kharif season. Cumula ve effect of produc on shor alls in three consecu ve crop seasons has put pressure on the farm economy. This is a cause of worry as there is a posi ve outlook of the economy as a whole, and yet agriculture may lag far behind. The immediate effect of shor all in farm income will be on both consump on and produc on decisions of farmers. Therefore, it is important to expedite the release of compensa on to farmers, and encourage financial ins tu ons to
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advance loans to farmers. Recent debt and investment survey of NSSO has shown that rural poor s ll have limited access to ins tu onal finance and they borrow from informal sources at a very high rate of interest. The income shor all years can however be used for popularizing risk sharing mechanism like crop insurance as farmers can be er understand the benefits of crop insurance. There are now insurance products directly linked with weather and crop loss events. The agriculture department should also build capacity of farmers to use their tradi onal risk
management methods, which will require informa on flow to them about weather forecasts. In the long run, policy thrust should be on accelera ng economic growth and promo ng inclusiveness by raising agricultural produc vity. Several noteworthy ini a ves have been ini ated taken in the Union Budget in this direc on. A rac ng investment, development of infrastructure and encouraging entrepreneurship are special areas of focus. Since agriculture
The agriculture department should also build capacity of farmers to use their traditional risk management methods, which will require information flow to them about weather forecasts.
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Enhancing Agricultural Growth and Rural Income AEFI is an important sector to promote inclusive growth and reduce poverty, it is essen al to address the binding constrains to higher agricultural produc vity, besides ensuring food and nutri onal security. This budget has touched three key constraints, namely water, credit and markets for higher agricultural produc vity. There are alloca ons for irriga on development, but this is more of an implementa on issue as there is moderate expansion of irrigated area despite successive alloca ons in the past. The measures to increase credit flow, especially long‐ term credit, and strengthening capacity of rural financial ins tu ons (cooperat‐ ves and regional rural banks) will go a long way in improving financial inclusion of farmers and rural poor. This is important when the cost of produc‐ on is rising. At the same me the livestock and hor culture, which are the fast growing sectors, need more capital. Capital requirement is going to increase further as farmers shi to farm mechaniza on for higher resource use efficiency and produc vity. Establish‐ ment of the Na onal Agricultural Market is another historical effort to improve access of small farmers to product markets and to ensure be er prices for their products. This will be realized through greater informa on flow facilita ng price discovery, reduc on of market fees and other costs, and interstate movement of agricultural produce. Besides these direct proposals, there are other ini a ves which shall benefit agriculture and rural develop‐ ment. Establishment of MUDRA shall help in promo ng small business, which are located in rural areas and small towns. These micro and small busine‐
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sses are also providing non‐farm services and inputs. Credit needs of these businesses are higher than what can be usually met through self‐help group ini a ves but much lower than what commercial banks are willing to entertain. Thus, MUDRA bank is a welcome step to meet capital require‐ ment of rural non‐farm enterprises, and development of rural non‐farm sector will help provide more employment and reduce poverty.
Third important ini a ve of the government in the context of rural development is the “Gramin Kaushal Yo j a n a ” w h i c h s h a l l i m p r o v e employabi‐lity of rural youth in non‐ agricultural sectors of the economy. This in a way shall accelerate shi of popula on dependent on agriculture to other sectors, and thus enhance per capita income and generate some surplus in agriculture. The benefits of this scheme shall be much stronger when rural literacy rate is rising and new employment opportuni es are created in non‐farm sectors. 2015 MAY
Establishment of MUDRA shall help in promoting small business, which are located in rural areas and small towns. The substan al alloca ons are made for electrifica on, digital connec vity, rural infrastructure and MNREGA, which are also expected to i m p rove p ro d u c ve ca p a c i t y o f agriculture through be er rural infrastr‐ ucture and informa on. Thus, steps taken outside agriculture may prove to be quite effec ve in increasing agricultural produc vity and income. But these may fall short to address the income inequality, as other sectors are likely to grow much faster than the agricultural sector. Therefore, social safety nets like the recently launched income insurance and pension scheme, and other income enhancing opportu‐ ni es in rural areas shall assume greater significance in reducing rural‐urban disparity and coping with the adversi‐ es.
Dr. Suresh Pal Division of Agricultural Economics Indian Agricultural Research Ins tute New Delhi‐110012
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AEFI Crop Insurance— The Protection & Availability: A Farmer's Choice
CROP INSURANCE The Protection & Availability: A farmer's Choice
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Currently, AIC covers 24 million farmers under its various crop insurance schemes. Of these, more than 86% belong to the “small & marginal” category. The major challenge of Crop Insurance business is to reach the remotest farmer in the country and service him at an affordable cost.
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griculture Insurance Company of India (AIC) an en ty created at the behest of the Government of India and the market leader in all forms of crop insurance work intensively in developing awareness as to how the insurance concept works. The primary objec ve of Crop Insurance is to provide financial security to farmers against agricultural risk. Insurance, by nature, involves spa al and temporal spread of risk, wherein losses paid to farmers in an area are made good by farmers of
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other area, and also losses paid during bad years are made good by good or normal years. AIC, designated by the Government of India as its sole “ I m p l e m e n n g A ge n c y ” fo r t h e Government formulated Na onal A g r i c u l t u ra l I n s u ra n c e S c h e m e popularly known as N A I S, being implemented from Rabi 1999‐2000, started its opera ons from April 2003. AIC insures more than 35 crops during Kharif and an equal number of crops during Rabi season. Weather based
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crop insurance arrived in India during Kharif 2003 season through BASIX a micro finance ins tu on. AIC, created e xc l u s i v e l y t o i m p l e m e n t c r o p insurance schemes, implemented weather insurance scheme on pilot basis from Kharif 2004 since it appeared a more promising risk mi ga on scheme. Government of India formulated Weather Based Crop Insurance Schemes which was implemented on a pilot basis in Karnataka State in consulta on with the State Government as an alterna ve to NAIS during Kharif 2007. The Scheme was operated on an actuarial basis with an element of subsidy. For this purpose government allocated Rs. 100 crore in 2007‐08. Pursuant to the announcement in the Union Budget, AIC launched the pilot on weather based crop insurance during Kharif 2007 season in www.krishijagran.com
Crop Insurance— The Protection & Availability: A Farmer's Choice AEFI Government of India formulated Weather Based Crop Insurance Schemes which was implemented on a pilot basis in Karnataka State in consultation with the State Government as an alternative to NAIS during Kharif 2007. The Scheme was operated on an actuarial basis with an element of subsidy. Karnataka in about 70 Hoblis for eight crops, as an alterna ve to NAIS. AIC designed a customized weather insurance product for the pilot, providing for crop‐stage specific payout against con ngencies of deficit and excess rainfall. About 50,000 hectares of crops were insured for a risk value of Rs. 500 million under the pilot. The number of states was increased gradually season a er season. Government of India has announced Na onal Crop Insurance Pro gramme ( N C I P ) co mp risin g Modified Na onal Agricultural Insurance Scheme (MNAIS), Weather B a s e d C ro p I n s u ra n c e S c h e m e (WBCIS) and Coconut Palm Insurance Scheme (CPIS) from Rabi 2013‐14. Whilst claims under NAIS, MNAIS & W B C I S are based on 'area approach', CPIS is on 'individual assessment' basis; the salient features of the schemes are: Modified Na onal Agricultural Insurance Scheme (MNAIS): ·
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Village Panchayat to be the unit of insurance for major crops where yield data for at least 5 years is available Coverage for prevented sowing/ plan ng risks; comprehensive
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cover for standing crops; post‐ harvest losses due to cyclonic rains in cut & spread condi on for a maximum of two weeks' On account' payment not exceeding 25% of likely claims due to Mid‐season adversity Preceding seven years yield to be considered, excluding maximum 2 years in which a calamity such as drought was declared by the concerned authority of Govt., for arriving at the average yield. Indemnity levels are 90% & 80% Uniform seasonality discipline for loanee and non‐loanee farmers Actuarial premium rates capped at 11% for Kharif and 9% for Rabi for food crops & Oilseeds; in case of and for annual commercial/ hor cultural crops rates are capped at 13% Up‐front premium subsidy to all farmers irrespec ve of their landholdings and crops insured to the extent of normal Sum Insured or capped Sum Insured; and equally shared by GOI and the respec ve State Government Individual assessment of claims in ca s e o f s p e c i fi e d l o ca l i ze d calami es e.g. landslide and hailstorm Payment of post – harvest losses in coastal areas. En re claims are borne by the insurance company.
Parametric insurance product designed to provide insurance protec on against likely losses in c ro p y i e l d r e s u l n g f ro m 'adverse weather incidence' – deficit & excess rainfall, un‐ seasonal rainfall, rainy days, dry‐ spell, dry days, rela ve humidity, heat, frost, wind speed & a combina on of the above Add‐on/Index‐Plus cover for Hailstorms & Cloud‐burst for farmers All cul vators including sharecroppers, tenant farmers growing the no fied crops in any 2015 MAY
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Reference Unit Area are eligible for coverage. Compulsory for loanee farmers and voluntary for non‐loanee farmers. Sum Insured is pre‐defined (broadly the cost of produc on) per unit area Actuarial premium rates are applicable and capped at 10% for Kharif and 8% for Rabi for food crops & oilseeds and 12% for annual commercial/hor cultural crops Up‐front premium subsidy to all farmers irrespec ve of their landholdings and crops insured not exceeding normal Sum Insured of the no fied crop; and equally shared by GOI and the respec ve State Government The insured cul vators become eligible for payout if the 'Actual Weather' recorded at a RWS during the specified me period shows devia on as compared to the specified 'Trigger Weather'. Payouts normally within 45 days from the end of the insurance/ risk period. En re claims are borne by the insurance company.
Coconut Palm Insurance Scheme (CPIS): ·
Cover offered for healthy 'nut' bearing Coconut Palms of all varie es; Dwarf & Hybrid palms in
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AEFI Crop Insurance— The Protection & Availability: A Farmer's Choice techniques; Pilots may be taken up to explore the possibili es to use modern technology like Remote Sensing Technology (RST)/Satellite imageries in consulta on with Ministry of Earth Sciences / Ministry of S & T in this regard. Presently, apart from AIC, there are ten private insurers par cipa ng in the implementa on of WBCIS and MNAIS for different crops across different territories in the country.
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the age range of 4‐60 years and Tall variety palms in age range of 7‐60 years Annual Insurance policy. Can also be taken for upto 3 years Premium subsidy at 50% by CDB and 25% by par cipa ng State Scheme covers perils leading to death/loss or palm becoming un‐ produc ve due to Storm, Hailstorm, Cyclone, Typhoon, tornado, heavy rains, flood & inunda on, Pests & Diseases of w i d e s p re a d n at u re ca u s i n g , irreparable damages to palm, accidental fire, forest fire& bush fire, lightening , Earthquake, landslide & tsunami, severe drought and consequen al total loss The insurance coverage and claim assessment shall be on 'individual tree' basis. Claims are payable within one month from date when all relevant cer fied details of claim are received in the office subject to receipt of premium subsidy from stakeholders.
The Government proposes to use modern technology like General Packet Radio Service (GPRS) and mobile phones etc. for effec ve implementa on of the crop insurance schemes in the country. There is a provision under Na onal Crop Insurance Programme to explore and a d o pt s ate l l i te i m a ge r y, a g ro ‐ meteorological and econometric and a combina on of such techniques, etc. as alterna ve yield assessment
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Both these products are available through financial ins tu ons as well through intermediaries and to the farmers i.e. sharecroppers, tenant farmers. Both weather based crop insurance and area yield based crop insurance seem to have rela ve strengths and weaknesses. Weather insurance seems to score be er when it comes to data accuracy, transparency and quick se lement of payouts. On the contrary, Area Yield insurance seems to do be er in term s o f s co p e o f in s u ra n c e (comprehensive coverage of risks), product design and to some extent, lower basis risk compared to weather insurance. Apart from Govt. Schemes, viz. NAIS, MNAIS & WBCIS, AIC's constant research & developmental efforts have yielded a range of in‐house farmer‐ friendly, tailor‐made products for specific crops and risks comprising – · · · · · ·
Rainfall Insurance Varsha Bima Mango Insurance Generic Weather Insurance (Rabi) Rainfall Insurance Scheme for Coffee Grape Insurance
monitoring and loss assessment is envisaged with the appointment of an 'Anchor' from the community itself. The loss assessment would be periodically supported by videography in the geo‐ tagged and geo‐fenced fields. This approach intends to minimize the basis risk and provide actual indemnity to each suffering farmer. A Double‐trigger Crop Insurance (Weather & Yield) product has been developed. In Karnataka, a “Farmers' Loyalty Bonus Program” has been introduced on experimental basis wherein a Premium discount is offered to long‐ term repeat farmers in an effort to retain them over mul ple insurance periods. Currently, AIC covers 24 million fa r m e rs u n d e r i t s va r i o u s c ro p insurance schemes. Of these, more than 86% belong to the “small & m a r g i n a l ” c a t e g o r y. T h e m a j o r challenge of Crop Insurance business is to reach the remotest farmer in the country and service him at an affordable cost. There are s ll crops in India which do not have adequate historical yield data in some areas. Many of these crops do not lend themselves to 'individual based insurance' due to either low value or high complexity. Ul mately, the success of Crop Insurance program in India would depend on crop insurance product design, steps taken to minimize the basis risk, crea ng realis c & a p p ro p r i ate co m m u n i ca o n fo r different stakeholders, adop ng reliable & sustainable pricing including governmental subsidies and product servicing & mely payout.
Tradi onal Crop Insurance · · · · ·
Potato Insurance Bio‐fuel tree/plant insurance Coconut Palm Insurance Rubber planta on Insurance Pulpwood Insurance
In Andhra Pradesh and Bihar, AIC has piloted a “Community Based Individual Farm Insurance Scheme” (CBIFIS), where a role for the farming c o m m u n i t y i n e n ro l m e n t , c ro p
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S. S. Saxena Deputy General Manager Agriculture Insurance Company of India Limited (AIC), New Delhi www.krishijagran.com
Transformation@ locusts into fodder AEFI
Transformation@ locusts into fodder
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Russian scientists have devised a way to transform locusts into animal feed. According to the inventors, the insects should be processed while still at nymph stage and wingless, their nutritional value being much higher at this point.
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ollowing a practice in China and other Asian countries, researchers at the Chelyabinsk State Agriculture Engineering Academy have invented mobile machines capable of collecting locusts and grinding them into nutritious fodder for livestock. The scientists claim other solutions already present on the market are not as efficient since they involve collecting adult insects which have already sprouted wings, as they lose most of their nutritional value by then. The inventors believe that locusts should be processed into fodder while still wingless. The tests of the new technology, conducted in Southern Russia, have shown some very positive results. Transforming foe into food With about 75 percent of their dry weight composed of protein, locusts are much more nutritious than meat or fish (the percentage of protein is 17 for pork and lamb, and 21 for fish). The Russian developers affirm that while similar solutions for transforming locusts into fodder are already implemented in some countries, including China, they rely exclusively on catching winged adult insects, and at this point of their life-cycle they lose most of their nutritional value. “Winged locusts contain less nutrients, so when they are processed, the results are underwhelming. We catch them as they are moving through the fields, at the stage when they quickly consume vegetation and grow. The machine we invented collects about 70 percent of a swarm, crushing the rest. After a single pass, no insects are left,” says provost of Chelyabinsk Academy Peter Svechnikov. www.krishijagran.com
With about 75 percent of their dry weight composed of protein, locusts are much more nutritious than meat or fish. Source: Shutterstock / Legion‐Media
Global market opportunities The technology was born in the Southern Urals about 10 years ago, after one of the inventors stumbled on an article lamenting the great damage caused by the insects and the enormous expenses of containing the threat. “Our partners in Tajikistan, Uzbekistan, Kalmykia and Saratov have been requesting us to develop a solution to process locusts for a long time,” Svechnikov says. “We tackled the issue, making several trips to the south of the country to test some solutions. The technology has already become popular, with orders pouring in ever since, some of them from abroad.” The developers estimate the implementation of the new technology to cost a $30,000 to $40,000. The buyer would be able to recover the costs in a week. The cost of their equipment is put at $10,000. According to the scientists, the production cost of a kilogram of locust meal will be about 10 rubles (20 cents), the market price of the fodder being five times higher, to the tune of a dollar. Expert perplexed The admittedly unusual idea of processing locusts into animal feed left most Russian agriculture experts somewhat confused. None of the officials at the Russian Animal Farmers Union, Ministry of Agriculture or the Union of Agricultural Cooperatives could comment on the prospects of the new technology. Chairman of the Urals Livestock Breeders' Union Ilya Bondarev believes there are not enough locusts in Russia for the technology to be financially feasible. “Think of how high the consumption of animal feed is, and compare that to the number of locusts that is needed,” 2015 MAY
Why locusts? Locusts attack crops in swarms 1.5 to 2 kilometers wide, the “carpet” of insects covering the ground being 20 to 25 centimeters thick. Locust invasions occur yearly in all the regions of Southern Russia and Kazakhstan. According to the scientists at Chelyabinsk Academy, locusts caused billions of dollars worth of damage to the farmers of Bashkiria and the Southern Urals in 2014. Bondarev told RIR. “Besides, locusts are sprayed with pesticides. How exactly are we supposed to use contaminated insects in fodder.” Nevertheless, the inventors are convinced there will be enough insects to go by as the mass of an average locust swarm can touch 35,000 tons, and invasions occur each year. Georgy Gaidadin, CEO of the Russian fodder production company Bioenergiya believes the technology holds great promise. “At the moment, fishmeal is considered to be the most nutritious fodder supplement. But the world is running out of fish, so locust meal may well become a excellent alternative source of easily digestible protein for different species of domestic animals and birds,” says Gaidadin. Darya Kezina
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AEFI RBL Bank aims to be big in Rural & Agriculture Banking Sector
RBL Bank aims to be big in Rural & Agriculture Banking Sector
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Riding on strong growth trajectory, Ratnakar Bank Limited (RBL) aims to provide holistic services to farmers and rural customers with Value Chain approach.
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BL Bank is one of India's fastest growing banks serving over 14 lakh customers through its 183 branches; and has delivered a stong growth performance in FY 14‐15. One of the notable factors responsible for the Bank's growth has been significant growth in “Priority Sector Lending Business”. The Bank has achieved all its Priority Sector Lending as well as all sub‐ sector targets for three years in a row including FY15. During FY 14‐15 the Bank's priority sector lending was seen at 47.86% as against mandated 40%. The bank has been honored as Best Bank Priority Sector Lending (Private Sector) at Dun & Bradstreet Banking Awards and as a Global Growth Company by the World Economic Forum in 2014. RBL Bank has also been recognised as India's Fastest Growing
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Mid‐Sized Bank for three years in a row by Business Today – KPMG India's Best Bank Study. Speaking to Agriculture World, Manoj Rawat, Head of Agribusiness at RBL Bank says, “Agriculture, Rural Banking and Financial Inclusion” will be next driver of growth for Indian banking Industry. An inclusive banking system has become a top priority to drive growth in the country and also to address the two key areas of concern namely, Financial Inclusion and Food S e c u r i t y. T h e s e t w o a r e a s a r e 'intertwined' and are set to drive the next phase of economic growth of the country which will be alot more par cipa ve, broad based & inclusive.” 1. What are the emerging opportuni‐ es for banks in Rural India? A quiet yet sound revolu on is
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taking place in rural India where economic growth is not just about crea ng wealth but also offering huge opportuni es for banks to service the financially excluded. Today Rural Banking is being seen as a huge opportunity,with rural financial services being one of the fastest growing segments. It is being increasingly recognized that Rural Business, Agriculture Business, Food Security, Financial Inclusion and M S M E are serious business opportuni es which can help develop a robust Rural Business model. The basket of products that Rural India requires will be far more wholesome than of Urban India. The various segments which are going to see the next big growth opportunity include Agribusiness, MSME, Rural Housing, Renewable Energy and Services. 2. What is the significance of Agriculture in the Indian economy? Agriculture sector remains the mainstay of the Indian economy (although it contributes about 14% of www.krishijagran.com
RBL Bank aims to be big in Rural & Agriculture Banking Sector AEFI the na onal Gross Domes c Product (GDP) as 60% of Indian families are s ll dependent on agricultural income for livelihood. India today is the largest producer of milk, pulses and spices. The country alsomaintains the largest ca le herd and covers the largest area under wheat, rice and co on. While agriculture share in India's economy has con nued to decline due to the high growth rates of the industrial and services sectors, the agriculture sector's importance in India's economic and social well‐being goes well beyond this indicator. 3. What is the approach of RBL Bank to wa rd s A g r i c u l t u re a n d R u ra l Banking? Agribusiness credit is the most cri cal non‐land input in agriculture and has played a pivotal role in increasing agricultural produc on in India. Although Agri‐credit has its own statutory significance and generates a strong goodwill with the Regulator and Government, at RBL Bank we approach
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this as a huge business “opportunity” rather than an “obliga on”. We believe Rural & Agriculture business offers huge business poten al and can generate sustainable economic value to the Bank, farmers, customers and our other stakeholders. At RBL Bank we have iden fied Agribusiness and Rural banking as one of the key areas for growth, and a driver for expansion of branch networks in Semi‐Urban and Rural India. The Bank adopts a five‐pronged approach to increase its relevance in Rural India · Focus on direct farmer banking requirements, · Develop innova ve products and market specific schemes for farmers and rural customers, · Tap the en re value chainincluding farmers, ar sans and other players in the different catchments, · Increase outreach through expansion of ins tu onal network and use of technology and
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Work with farmers and corporates to forge both forward and backward linkages.
4. How have you modelled your Agriculture business? The Agribusiness for our bank has been modelled to address the different target markets in a focussed manner across the value chain.
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AEFI RBL Bank aims to be big in Rural & Agriculture Banking Sector
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Retail Agribusiness:The Bank is leveraging on the strength of its exis ng branch network and also some new branchesthat are being rolled out, to expand and grow its Agribusiness por olio. Besides historical branches, which have rich Agribusiness poten al, many new branches have been iden fied which offer large Agribusiness poten al in Retail and Commodity business. Banks offer Smart ATM‐ cum‐Debit Card on Rupay Pla orm to its farmers under “Kisan Credit Card” Scheme. Retail Agribusiness has become one of the major thrust areas for banks. Wholesale Agribusiness & Value Chain Finance: The wholesale Agribusiness and Value Chain Finance forms an important segment of Agribusiness which addresses the key corporate and ins tu onal rela onships in agricultural sector to enable bulk farmer funding deals. It works with Sugar factories, Dairies, Planta on co mp an ies , Agro ‐ p ro ces s in g industries, Agri‐input companies etc. Commodity Finance and Pledge Finance: Commodity Finance and Pledge Finance to farmers against hypotheca on of agricultural produce (including warehouse receipts) has been iden fied as another segment for growth of Agribusiness. R B L Bank has already launched Warehouse Re c e i pt F i n a n c i n g p ro g ra m , wherein credit facili es are being extended to farmers, processors and grader sorters, primarily based on the underlying asset i.e. Agri‐ commodi es. Our Bank offers commodity finance for both perishable and non‐perishable commodi es. ISSUE-5
R B L Bank has been offering products to its farmers and rural customers for Renewable Energy, Micro‐Irriga on, Hi‐tech cul va on, Agri‐warehousing and Agri‐marke ng Infrastructure. Ourbank is working with various innova ve projects namely, Model villages, Be er Water Management ini a ves, Improved Ca le Management program, Livelihood enhancement projects and Farm mechaniza on. 5. What is key to deliver agriculture credit to farmers? The flow of credit to agriculture has increased significantly in the recen mes. This year the ins tu onal agriculture target is more than Rs. 8 Lakh Crores.Although the amount of agricultural credit has increased substan ally, during the last few years, the access to formal sources of credit has been inadequate for small and marginal farmers (who cons tute for m o re t h a n 8 0 % o f t h e fa r m i n g community). Banks have to come up with innova ve products to address the credit and banking needs of smaller farmers. Our bank has a special focus on small and marginal farmers and has developed innova ve products which cater to the needs of these smaller segments. We are using our Bank's outreach program and technology frameworks to address the banking needs of smaller customers. It has been our endeavor to offer a comprehensive suite of short term & long term financial products to famers inorder to give them a wholesome, affordable and efficient banking experience. 6. What kind of framework is needed to increase banking outreach to the last mile in the country? The Financial Inclusion ini a ves of the Government and Regulator to provide access to banking services at all villages through Branches, Ultra Small Branches, Mobile Banking, ATM or Kiosks or Business Correspondents at an affordable cost is going to change the banking landscape in India. Banks are gearing up by upgrading the technology infrastructure to include core banking solu ons, mobile and internet banking, Mobile ATMs, Smart Cards with the objec ve to reduce the cost of transac ons, improve customer
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experience and build a compe edge for themselves.
ve
However, the sustainable success o f th e “Fin an cial In clu sio n an d Deepening” ini a ves will be achieved by adop ng an approach wherein all stakeholders work on this “Commercially viable proposi on & Value Crea on opportunity” rather than only a Government or Regulator driven mandate. For banks the challenges do remain but the willingness to move from an “o b l i g a t o r y ” t o “o p p o r t u n i t y ” approach, from “Class” to “Mass” banking and from “Exclusive” to “Inclusive” strategy will remain key. Bankswill need to work “High Volume” business with technology and innova onasthe key drivers. The various ini a ves of the policy makers, regulator and banks in this direc on isgoing to transform Rural India and pave the way to achieve “true & las ng financial inclusion” and would also contribute to crea ngsustainable food and nutri onal security for the country. At RBL Bank we see “Rural” as the next big opportunityas wework towards becoming one of theadmired leaders in this segment.
Manoj Rawat is Head of Agribusiness at RBL Bank Limited (Formerly: The Ratnakar Bank Limited) and has more than 20 years experience in Rural, Agriculture and Financial Inclusion.
Manoj Rawat Head, Agribusiness Group, RBL Bank Manoj.rawat@rblbank.com h p://www.rblbank.com www.krishijagran.com
House Hold Economy of a Farmer in India AEFI
T
House Hold Economy of a Farmer in India
he word farmer in the tle of this ar cle refers to the one who actually cul vates the land and not the one who merely owns the land. They may be small or marginal farmers, or those who are tenant cul vators or share croppers or agricultural labourers. In short the term refers to all those who are depending solely on farming for the lively hood of their families. This paper on the “House Hold Economy of a farmer in India”, tries to highlight some of the hidden areas of economic situa on of the farmers in India. THE WORD FARMER REFERS TO THE ONE WHO ACTUALLY CULTIVATES THE LAND AND NOT TO THE ONES WHO MERELY OWNS THE LAND. There are two aspects in human life: existence and development: existence refers to physical existence; www.krishijagran.com
whereas development means both physical and mental. In the case of animals existence and development refers to physical and not mental but in the case of human beings existence and development means both physical and mental. For a human being existence without development is meaningless and development without existence is impossible. Every human has a right to adequate and sufficient means and materials for his physical and mental development. Hence the first thing we need to keep in mind is that both existence and development cost (cost of living) the individual or family and second thing is that the cost goes on increasing year a er year if not month a er month. FOR A HUMAN BEING, EXISTENCE WITHOUT DEVELOPMENT IS MEANINGLESS AND DEVELOPMENT WITHOUT 2015 MAY
EXISTENCE IS IMPOSSIBLE. EVERY HUMAN HAS A RIGHT TO ADEQUATE AND SUFFICIENT MEANS AND MATERIALS FOR HIS PHYSICAL AND MENTAL DEVELOPMENT. Broadly the costs of living in any family are two types: food expenditures and non‐ food expendi‐ tures. For the food consump on the most accepted standard for India is what is recommended by the Indian Council of Medical Research (ICMR,1981) in order to ensure supply of enough energy, proteins, 15 vitamins and 24 minerals. Es ma on of food expenditure Given below is a list of food items (Table 1) that make up the balanced diet and the minimum average amount per person per day in a family of six (we shall term it as “per family‐head”) which is
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AEFI House Hold Economy of a Farmer in India
Table 1 List of food items for a balanced diet and their amount per day per family‐head 1.
Cereals and millets (grains) consumed in any form.........................500 gm/per day
2.
All types of pulses/meat/fish.......................................................... 50 gm/per day
3.
Oil and fat .......................................................................................50 gm/per day
4.
All types of leafy vegetables.............................................................50 gm/per day
5.
All types of root vegetables..............................................................50 gm/per day
6.
All types immature pod and fruit vegetables....................................50 gm/per day
7.
All types of fruits..............................................................................50 gm/per day
8.
Mixed salad with tomato, onion, carrot, cucumber etc....................50 gm/per day
9.
Mixed herbal chatney with ginger, garlic, mint, coriander etc..........50 gm/per day
10. Milk and milk products.......................................................................200 ml/a cup 11. Egg.................................................................................................half to one/day 12. Tea/coffee ......................................................................................2 to 3 cups/day 13. Salt, Spices and condiments..........................................................as per need/taste
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House Hold Economy of a Farmer in India AEFI Table 2 Estimation of the cost of food per day per family-head and for a family of six members Sl No
Food items
gm/per day
Price* Rs Per Kg
Cost per day
1
Cereals and millets (grains) consumed in any form
500
40
20.00
2
All types of pulses/meat/fish
50
150
7.50
3
Oil and fat
50
90
4.50
4
Sugar
50
35
1.75
5
Types of leafy vegetables
50
15
0.75
6
Types of root vegetables
50
30
1.50
7
Types of immature pod & fruit vegetables
50
60
3.00
8
Types of fruits
50
80
4.00
9
Salad of mixed items
50
40
2.00
10
Herbal chatney of mixed items
50
15
0.75
11
Milk and milk products
50
35
1.75
12
Egg
Half egg
6/No
3.00
13
Coffee/Tea
2‐3 cups
5/cup
10.00
Spices/salt
As per need
100
14
5.00
Total cost per day per family‐head
65.50
Total cost of food per family per day
393.00
Total cost per month per family‐head
1965.00
Total cost per year per family‐head
23,907.50
Total cost per year per family of six members
1,43,445.00
Addi onal cost for food for guests, fes val days etc.
6555.00
Total es mated food expenditure per year/family
1,50,000.00
recommended amount of food items he will spend double the amount in the medicine and treatment. There are many studies showing that 80‐90 per cent of the sickness in India are due to lack of
proper nutri on especially vitamins and minerals. India ranks first the world in the incidence of Tuberculosis and mal‐nutri onal diseases. THERE ARE MANY STUDIES SHOWING THAT 80‐90 PER CENT OF THE SICKNESS IN INDIA ARE DUE TO LACK OF PROPER NUTRITION ESPECIALLY VITAMINS AND MINERALS. INDIA RANKS FIRST THE WORLD IN THE INCIDENCE OF TUBERCULOSIS. Es ma on of non‐food expenditure To have a life with dignity a person should have sufficient monthly/yearly income to meet about 34 non‐food items like housing, clothes, educa on, electricity, water, travel, furniture and household items etc. Table 3 is the list of non‐food items required for a family to have a decent human living. The list is not exhaus ve. Table 3 has listed all the necessary items and nothing of luxury items like vehicles, washing machine, air coolers, etc. are included in the list. Hence the
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life envisaged is with minimum things. Surveys show that an average ra o of 1: 4.725 between the expenditures on food and non‐food items remain more or less constant ll the income matches with expenditures as is clear from table 4 which is prepared on the basis of the income‐expenditure curves shown in Fig 1 (Samuelson Paul A. & Nordhuas William, D., 1989). Both Table 4 and Fig 1 shows clearly four cri cal stages of cumula ve expenditure as the income increases ll it becomes equal to the expenditure details. Above this stage the income‐expenditure curve refers to people who have saving or surplus. Both in the Fig 1 and Table 4 we can clearly iden fy four stages ll the cumula ve expenditure becomes equal to the income (threshold stage) in the fourth column. Till that point the ra o between food and non‐food expenditure works out to be between 1 : 4.3 to 1: 4.9: with an average of 1 : 4.725. This ra o changes significantly (1: 6 and above) once the income
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AEFI House Hold Economy of a Farmer in India Table 3. List of non‐food items Items Educa on, fees, books etc. Clothes, winter and summer clothes House repair/rent Toilet ar cles Recrea on Bedding material, beddings, sheets, pillow, Transport, travel, local and outsta on Fes vals, celebra ons Light, electricity charges, repair Water, drinking & other use Taxes, house, property, animals etc. Footwear for everyone in the family Shaving/ hair cu ng, cosmetcs Implements, instruments Washing, cleaning Utensils for kitchen Cigre e/ bidi Dona on, contribu ons Watch/ radio/ tv repair Ornaments, decora ons Guests, rela ves, visitors Marriage, a ending, gi s, Medicine, for all family members Furniture, shelves, storages facili es, boxes Newspapers/ magazines, Postage, currier services etc. Insurance Interest on loan Saving, inbvestments Deprecia on Drinks including so drinks Mobile phones, recharges Other expenses Repair and maintenance other than house
increases beyond the expenditure and the family will be in the saving mode showing that the expenditure on non‐food items increases significantly.Both Table 3 and Fig 1 show that as the income increases the pa ern of consump on expenditures of various items, grouped under food and beverages, clothing,
housing, medical‐educa on‐recrea on, increase in such a way that the average ra o is maintained around 1: 4.725 between food and non‐food expenditures. When his income is more than the expenditure then the ra o will go up above 1:6 to any amount and also he begins the saving and investment. Under normal condi ons the food requirement of family of constant number, occupa on and life style will be constant. (Table 2 & Table 3). Hence at any given me it is easy to es mate the actual cost of the minimum food requirement for a family on the basis of the prevalent price of food items in the market. Then using the ra o 1:4.725 we can es mate the required cost of non‐food items a family requires for life with dignity. The sum of these two will be the bare Income-Consumption-Saving Relationships 60,000
EXPENDITURES FOR CONSUMPTION AT DIFFERENT INCOME LEVELS, 1989
55,000
Saying
50,000 45,000
Dollers Expended
Sl.No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34
Medical Care, Education Recreation, etc.
40,000 35,000 30,000 25,000
Automobiles and Transportation Clothing
20,000 15,000
All Housing
10,000 5,000
Food and Beverages
0
Stages*
20,000 40,000 Income Level (after taxes)
60,000
1---to---2-----to----3--to---4-----above-------------------------------
Critical Stages in Expenditure Curves 1. 2. 3. 4.
Stages Stages Stages Stages
1 to 2 2 to 3 3 to 4 above 4
= = = =
Bare Necessity Convenient Necessity Comfort Luxury
Cur ves from Bottom are : 1. 2. 3. 4. 5.
Food and beverages Clothing related Housing related Transport & automobiles Medical, Education & recreation
Saving & Investment Begins with 4th Stage Fig - 1
Table 4 Cri cal stage wise cumula ve values of consump on(Rs) Items of consump on expenditures
Cri cal stages of family consump on (Rs) 1
2
3
4
5
Food & drink +Clothes +Housing+Transport+ Medicine.+Edun+Recrea on
14642
17143
22322
25358
48215
Food & drink + Clothes +Housing +Transport
11428
12857
17322
18572
32858
Food & drink + Clothes +Housing
8571
9285
12322
13215
22858
Food & drink + Clothes
3571
4285
5179
5715
9643
Food & drink
2500
3214
3750
4286
6786
Income
5000
7500
15179
25358
60000
Food : Non‐food Exp. Ra o
1: 4.8
1: 4.3
1: 4.9
1: 4.9
1: 6.1
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House Hold Economy of a Farmer in India AEFI minimum amount required for a family to have a decent and dignified living though without any security against any extra‐ordinary expenditures or any saving or investment. Both in the Fig 1 and Table 4 we can clearly iden fy four stages ll the cumula ve expenditure becomes equal to the income (threshold stage). Till that point the ra o between food and non‐food expenditure works out to be between 1 : 4.3 to 1: 4.9: with an average of 1 : 4.725. This ra o changes significantly (1: 6 and above) once the income increases beyond the normal household expenditures and the family is in the saving mode showing that the expenditure on non‐food items increases significantly. We have already es mated the total expenditure requirement for various essen al food items as 1,50,000 per year for a family of six as given table 2. In table 5 es ma ons of the total expenditure on non‐food items based on the ra o of 1: 4.725 and also the total of es mated household expenditure for one year. The minimum required amount of net income for a family of five to six as per the rates of food items given in table 2 will be around 8,60,000 per year per family. If the rates go up the total income requirement will also go up. The prices fluctuate during the year but from year to year there is a steady increase in the price rate of consumer
Table 5 Es ma on of total annual expenditure Sl. No
Items of expenditures
Amount
1
Es mated food expenditure per year
2
The ra o between food and non‐food expenditures
3
The es mated non‐food items' expenditure
7,08,750.00
4
Total es mated annual expenditure (1+3)
8,58,750.00
5
Including the con ngency the total annual expenditure can be es mated to be
8,60,000.00
things. Which farmer as defined above has 8,60,000 rupees net income per year. In general no small or marginal farmer or share cropper or tenant farmer or an agriculture labourer can earn 8,60,000 rupees at the current price level of food and other household things. Hence he borrows money from wherever it is available but will never be able to pay back. He is born is debt, live in debt and die in debt. No amount of government incen ve or subsidy or loan will help him to get out of his debt trap. Kink in the thinking In a farmer's labour the me and human energy are not adequately remunerated as compared to an industrial or nonfarm employee. A farmer works in the sun, rain, day and night, in cold and heat spending 3000 to 4000 Kilo calories per day with least amount of nourishment while his counterpart in an office spend much less human energy with much be er nutri onal status. Secondly the me factor to produce all the agricultural products is not remunerated. Thirdly
1,50,000.00 1 : 4.725
the farmer's products are perishable. In this respect a comparison between a worker in the organized sector and a farmer in unorganized sector as given in table 6 will be useful to understand the farmer's economic situa on. Concluding remark The conclusion is obvious. From the above analysis how pathe c the life of a real farmer in our country is very clear in spite of the much lauded government loan and subsidy programmes c o r p o ra t e s o c i a l r e s p o n s i b i l i t y schemes. They are just like bandaging a sep c wound or oiling a cancerous organ in a body. No doubt there are many inherent economic and social bo lenecks. Economically the Indian farmer is s ll in a slavery condi on though socially they are not considered as a slave. In almost all the cases he does not even get the wages of his own and his family labour. But as per our es ma on everyday a six member family requires food items for about 393 (400) rupees per day. How many farmers have a net income of Rs 400 daily from his farm only to meet the food expenses. But if we add the expenditures of both food and non‐ food items the same family requires on an average 2356 rupees per day; for any farmer it is an impossible dream. Well the point is how far behind are the Indian farmers economically; and yet no one gave a thought to the problem from the human and existen al point of view, nor from the developmental point of view. EVERY FARMER INDIA IS BORN IN DEBT, LIVE IN DEBT AND DIE IN DEBT; ALREADY MORE THAN TWO AND HALF LAKHS HAVE COMMITTED SUICIDE IN DEBT.
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AEFI House Hold Economy of a Farmer in India Table 6: Comparison of remunera ons for a worker in the organized sector and farmer Sl.No 1 2 3 4
7 8 9 10 11 12 13
Worker in organized sector The number of working hours is fixed The working me is fixed. Work during day or night He is paid for the over me He is provided with coffee and snacks and subsided canteen facili es He is provided with medical allowances He is given leaves with pay. One month leave and casual leave He gets medical and maternity leave He is given child allowances Other allowances for fes vals Loan facili es linked with employment is given easily Housing allowances given TA and DA are provided O en consumer store's facili es are provided
14
Gets pension or P.F
15 16 17 18
Re res at the age of 58 He gets organiza onal support Compensa on is given in case of accident or death He gets various facili es such as road, transport, electricity, water, schooling etc. High social status Higher security in life Be er working condi ons Be er remunera ons Be er educa onal facili es for children Be er organized among themselves Higher economic and social status in life The price of the products is decided by the manufacturer They are not exploited easily They have greater control of their situa ons The increase in return is propor onate to the increase in investment Investors are ready to invest in organized sector The workers in organized sectors are “babus” in the system They are the masters in the system
5 6
19 20 21 22 23 24 25 26 27 28 29 30 31 32
Farmer Working hours is not fixed. He may have to work any no. of hours No fixed me. He has to work any me of the day and night No remunera on for his over me. No food is given during tea/coffee me. He has to arrange himself No medical allowances No leave or pay He has no medical or maternity leave No child allowances No fes val allowances No loan facility is provided easily No housing allowances No TA, DA provided Not available. Ra on shops provide only grain, sugar, oil and kerosene No pension or P.F is assured though promises are made by the government Re res only by death No organisa onal support No compensa on of any sort Facili es are rare or meagre Very low social status Low security, high risk Very poor and hard working condi ons Poor or no remunera on Poor or no educa onal facili es for children Poor or no organiza on Poor economic and social status in life The price of agricultural items are fixed by the middle men. The farmer is cheated and exploited easily The farmer has least control of his situa ons As the investment increases the marginal return decreases ll it reaches zero The investors are reluctant to invest in the farm sector The farmers are the “chaprasis” in the system They are the slaves in the system
Dr. K. T. Chandy He has authored 676 booklets on various topics coming under environment management and agri‐related subjects. He is on the Editorial Board of Krishi Jagran Media Group.)
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Breaking the myths surrounding the anti GMO Propaganda AEFI
Breaking the myths surrounding the anti GMO Propaganda The GMO Issue Over the two decades it is proven that GM technologies have contributed to increased food produc vity and environment improvement due to lower deployment of toxic pes cides. However, tradi onally an ‐GM ac vists have protested against the G M technology on the following grounds.
“
1) I t i s a n e l i t e m u l n a o n a l domina on with protected product ownership meant to exploit small farmers and deny technology at affordable price to small farmers.
5) While the world can be fed fully with organic food (no ma er what it takes to grow them all) why go for any technology applica on at all, proven or unproven?
In India the deep engagement of the public sector and national level private enterprises and the wide recognition of the technology at the farmer end has triggered the global ire of anti-GM lobby groups, triggering deployment of unprecedented global resources in India to the tune of several million Dollars and Euros to oppose this effort.
“
2) It is US dominated and is thrust on other countries.
India is the first country in the world to de‐mys fy all of these myths and prove to the world that:‐
3) Its safety and long term implicat‐ ions are unknown over the next 50 years and beyond.
a) GM crop development is not the sole domain of 4 or 5 mul na onal companies,
4) It is detrimental to biodiversity and finally.
b) GM crops bring immense economic
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contribu on at the bo om‐of‐the pyramid – the marginal farmer, who grows a variety of neglected crops, c)
The technology is not the limita on for any one to pursue the research and product delivery goals – The technology is accessible and
d) The intellectual property is not an impediment for breaking the dominance of top 4 mul na onals, but a facilitator for small ventures and public research organiza ons
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AEFI Breaking the myths surrounding the anti GMO Propaganda to legi mately secure technologies and deliver trait specific varietal seeds to small farmers who can grow and save their own seeds in their own right. In India the deep engagement of the public sector and na onal level private enterprises and the wide recogni on of the technology at the farmer end has triggered the global ire of an ‐GM lobby groups, triggering deployment of unprecedented global resources in India to the tune of several million Dollars and Euros to oppose this effort. If Indian success is allowed it is detrimental to the ac vism across the world and hence the epicenter of this ac vism rests in India currently. There are number of elements that have contributed to Indian public and private organiza ons breaking these myths. Myth No. 1 Elite mul na onal dominance: World over, four or five interna onal seed companies have focused on corn and oil seeds for the trait improvement due to large acreage of farming and the resultant economy of scale in adop on of GM technologies by large farmers focused on these crops. The economy of scale provides the large corpora on the ability to recover high investment cost in research, valida on, and post release monitoring of the product. However, these large corpora ons have not focused on crops of regional re l e va n c e fo r m o s t d e v e l o p i n g countries. In India the crops under development are predominantly focused on grain crops, vegetables, len ls, millets, groundnut, mustard and other edible crops and these are the domain of interest to mul na onal companies. Indian developers have licensed genes from interna onal sources or in some cases cloned their own genes with patent filing and have pursued integra on of these genes in crops of regional interest. This has provided opportunity during 2004 to 2009 more than 20 crops to be developed and tested by public and private enterprises in wide variety of crops. The focus of crop improvement related to a wide basket of crops such as
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Brinjal, okra, tomato, rice, potato, co on, chillies ( pepper), banana, papaya, Chickpea, Pigeon pea and Groundnut. Indian produc vity in most of these crops has stagnated over the years due to inability of the gene c resources to overcome chronic pests and pathogens. Indian produc vity for most of these crops is at about half or one third of the best produc vity when benchmarked to countries having highest produc vity. Most chemical solu ons have been less effec ve in mi ga ng pests and pathogens in these cro ps. Ap p lica o n o f b io lo gical solu ons externally to the plant has only very limited success (confined to few thousand acres forming a frac on of one percent of the total acreage in the country) but the success has not been uniform due to impact of the varying environment on the performance of the organism. The alternate N P M technologies and organic farming prac ces have not yielded currently even frac on of 1% of total Urinal produced in the country or anywhere in the world. The molecular solu ons have been explored with the help of plant and soil borne bacterial genes that have proven effec veness in mi ga ng these pests and pathogens. In other developing countries such as Brazil, Indonesia and Philippines too, independent researchers in the public research and na onal companies have developed products in their focus crops such as sugarcane, beans and potato. In Indonesia, the sugarcane crop has been developed by in‐country researchers and has been recently approved for
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Foremost GMO Myths Elite multinational dominance GM crops contribution to t h e r e s o u r c e p o o r, marginal farmers Technology and human competency is the limitation to develop crops by national companies
plant mul plica on. The Late Blight Resistant Potato is in advanced stage of evalua on and will be approved for release to farmers in Indonesia within the next few months. Similarly, in Brazil Brazilian regulators have approved the transgenic bean. None of these had any interest of mul na onal companies. In Philippines several varie es and publicly developed Bt Brinjal hybrids are under review by the regulatory authori es for release to the farmers. Similar efforts are undertaken in Vietnam as well for crops of local interest. India was in the forefront of this effort un l 2009 and has taught the model for Asian and South American countries to follow. The dismantling of the regulatory mechanism in India subsequent to the imposi on of moratorium by the then Environment Minister has put India behind by a decade in pursuing these
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Breaking the myths surrounding the anti GMO Propaganda AEFI interacted with one of the Bangladeshi farmer, he indicated that Indian farmers from West Bengal keep calling them to secure seeds from them. His answer to the West Bengal farmer was to buy fruits from them and not the seeds. It reflects how the Indian farmer is denied the right to secure the varie es developed by Public research ins tu ons in India which they could have sown and saved in their own right.
developments. While Central Potato Research Ins tute (CPRI ) was the first in the world to advance the Late Blight Resistant Potato with gene transfer from another public university, University of Wisconsin, they were denied field valida on of their crop during the last 5 years. Now the Indonesian research organiza on, that started the effort several years a er C P R I , has taken the lead to commercialize this product far ahead of India. Even if field evalua ons are permi ed now, it will take another three to four years for this crop to be introduced in India in Indian potato varie es. Indian farmers will now look for the Indonesian seed producers to supply them Late Blight disease resistant seeds, as at mes the late blight can be having devasta ng effect on the potato crop. The gene here is the potato gene itself, isolated from a na ve potato. Myth No.2 GM crops contribu on to the resource poor, marginal farmers: When the technology is adopted in public varie es, the technology has no barrier for it to spread among the marginal farmers. In case of Bt Brinjal, in Bangladesh the Bangladesh Agriculture Research Ins tute developed 9 varie es of Brinjal and out of the 9 varie es 4 are already approved for cul va on by farmers. The farmers cul va ng them have the right to save the seeds and replant them for successive seasons. Addi onally, the public research organiza on provides seeds to the farmers growing brinjal and there by ensuring complete affordability for the technology by all small farmers. When I www.krishijagran.com
The Bt Brinjal development effort, authorized by Government of India in 2004 as a collabora ve project, has provided for the first me three n a o n a l p u b l i c s e c to r re s e a rc h ins tu ons – Indian Ins tute of Vegetable Research, University of Agriculture Sciences, Dharwad and Tamilnadu Agriculture University the legi mate right to deploy the Bt gene licensed without royalty charge by Mahyco as a member of this government formed consor um, in 16 varie es that are publicly bred by these research ins tu ons. These were varie es adopted by farmers in different regions and were most suscep ble to fruit and shoot borer. Since these varie es were not resistant to pests, farmers were shelving them and moving over to other crops. It was but natural that these varie es needed access to the gene that could provide them the resistance property to fruit and shoot borer pest so that the resource poor farmers who cannot afford the costly hybrids could con nue
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to grow them. Three public research ins tu ons in three regions of the country developed these products and got them ready for delivery to resource poor farmers who can secure these seeds and save them for replan ng. Releasing transgenic seed varie es Public ins tu ons is unheard of in western world. The varie es of Bt Brinjal developed by public ins tu ons are developed by Indian ins tu ons for Indian farmers to grow them and save their seeds in their own right. In the Western world, the only other public good development was the virus resistant papaya the Cornell University developed for Hawaiian papaya growers and today this technology is widely adopted by papaya growers in USA. The Bt Brinjal collabora ve project was predominantly funded by Government of India extensively and this funding was approved by a Joint working group in which the Ministry of Environment was also a member. When Mahyco's product was evaluated and proposed for approval to GEAC. The varie es of Tamilnadu Agriculture University and the Dharwad University were also proposed for approval and release. However, the moratorium withheld the access to these seeds by resource poor farmers in the region. Over the last 5 years, the three public sector ins tu ons have totally disassociated themselves in pursuing these brinjal varie es due to the moratorium. Even if these varie es
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AEFI Breaking the myths surrounding the anti GMO Propaganda
Mr. K.Vijayaraghavan Chairman, Sathguru & Regional Coordinator, IP CALS, Cornell University
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Halal Exports May Help Russia's Agrarian Sector To Grow AEFI
HALAL EXPORTS MAY HELP RUSSIA'S AGRARIAN SECTOR TO GROW
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The halal market is currently experiencing a worldwide boom, and Russia is no exception. RIR spoke with Aidar Gazizov, general director of the International Center for Halal Standardization and Certification of the Russian Mufti Council, about the developments of this relatively young industry in Russia
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What does one have to do in order to receive a halal cer ficate in Russia? Receiving a halal cer ficate is not a complicated process. First of all the establishment has to follow all the exis ng Russian and interna onal sanitary norms. Then, during the process of cer fica on we train them in the halal rules and requirements, carrying out a full analysis of produc on. In the beginning our center's www.krishijagran.com
collaborators thoroughly study the technological process, as well as the raw materials and the ingredients. Special a en on must be given to establishments that produce meat products: The en re process of slaughtering the animal or bird has to be carried out in a humane manner and in accordance with Islamic law. Experts from the Halal Center make sure the collaborators follow all these regula ons. 2015 MAY
How is the process of obtaining a cer ficate in Russia different from other countries? T h e p ro c e s s o f o b t a i n i n g a cer ficate in Russia is not that different from in other countries. We have established es with leading world bodies and organiza ons, studied the experience of countries such as Malaysia, Turkey, the UAE, Saudi Arabia, Indonesia and others. Currently, there are plans to create a single, unified halal standard. Many of the enterprises we have cer fied have successfully entered foreign markets in the Islamic world. As of today more than 150 producers and companies offering halal services have received a cer ficate from our center. It should be noted that the idea of halal
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AEFI Halal Exports May Help Russia's Agrarian Sector To Grow tourism. One of our goals is to increase the co m p e ve n e s s o f t h e R u s s i a n producer, to assist domes c halal produc on in entering the interna onal market, and here government support is essen al. With which countries have you already established coopera on in the halal industry?
The export of quality Russian halal produc on is opening new opportuni es for developing Russia's agrarian and industrial sector. Source: TASS
does not only refer to food, but also to sectors such as tourism, hotel business, medicine and financial services. Which halal services are in demand in the Russian market? In par cular, how successful is Islamic banking? The interna onal standards of financial products that are in accordance with Sharia regula ons have already been translated into R u s s i a n . H o w e v e r, o u r e x p e r t community and the Economy Department of the Russian Mu i Council must do more to resolve issues related to the implementa on of these products.
AidarGazizov, general director of the International Center for Halal Standardization and Certification of the Russian Mufti Council. Source: Press photo
We have good rela ons with the Islamic na ons, including countries from the Arab world, with whose embassies and ministries we hold regular mee ngs. In July 2014 our center was accredited to the UAE Ministry of Environment and Water Resources, something that will allow Russian producers to find poten al Middle East halal markets. The export of quality Russian halal produc on is opening new opportuni es for developing Russia's agrarian and industrial sector. We have already cer fied the Kazan restaurant chain in the UAE, which is proof of the interna onal status of the Russian cer fica on body. Furthermore, one of the most important achievements of our center was the cer fica on of halal cafeterias for the athletes of the 2014 Sochi Winter Olympic Games.
Recently we have also seen ac ve growth in halal cer fica on in the hotel business. The annual turnover of the halal tourism market is es mated at more than $125 billion and its volume is 12.3 percent of world outbound
ViktoriaSemioshina Web Editor Rusia and India Report (RIR)
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AEFI Agriculture News
World's heaviest strawberry
H.M. Clause new subsidiary in Kenya
The 100- Year Wait is Over
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strawberry grown by a farmer in Japan has won the Guinness World Records title for the heaviest strawberry. It weighs a whopping 250gms with an approximate height of 8cm, length 12cm and circumference 25 to 30 cm. Farmer Koji Nakao from Fukuoka, Japan contacted Guinness World Records when he found an unusually large strawberry during harvest. Mutations can occur for a
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Blue Tomato: Innovation in Australia
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ew Blue tomato has entered the market in Australia. The 40 blue berries tomatoes produced an average three kilos per plant and most were sold at farmers markets. It also attracts the customers because of its unique taste and look. The blue skin of the tomatoes is because of the antioxidant known as anthocyanin found in dark pigmented fruits and vegetables. According to the expert of Melbourne University, blue tomatoes also contain anthocyanin and lycopene which are also present in red tomatoes but people also still need to eat a variety of fruits and vegetables to get all the necessary benefits from antioxidants www.krishijagran.com
variety of reasons, such as when frost damage affects the flowers of the strawberry plant. In this case, multiple berries have fused together to form one single large strawberry. The fruit has broken a long-standing record held for over 30 years. The previous record holding strawberry weighed 231 grams and was grown by G Andersen of Folkstone, Kent, and UK in 1983
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he senate has passed the Bio-security Bill 2014 in over 100 years which marks an incredibly significant milestone in the biggest overhaul to Australia's bio-security system. It is the largest and most comprehensive piece of legislation on bio-security this country has seen in over 100 years. The bill was strongly supported by the National Farmers' Federation (NFF). The legislation, Bio-security Bill 2014 will strengthen control measures to manage bio-security risks and control threats posed by 21st century pests and diseases in a modern and flexible way. It will be an important part of deciding the future of Australia's bio-security system. It is still a significant step forward compared to the previous bill and Quarantine Act. The Bio-security Bill will now return to the House of Representatives for final approval.
IFOAM Appeal On International Mother Earth Day
On International Mother Earth Day, IFOAM has warned that if we do not start protecting Mother Earth's soil, it will become impossible to feed a growing world population; keeps global warming below 20C or halt the loss of biodiversity. If we support the Organic Agriculture then it will support to save our soil.
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M. Clause, a global vegetable seed company, inaugurated its new farm in Nanyuki, Kenya on April 15 followed by a ribbon-cutting ceremony attended by senior management from HM. Clause including Deputy CEO, Franck Berger and Global Head of Supply Chain, Ghis Reusken. The French ambassador to Kenya, M. Rémi Maréchaux, who emphasized the importance of seed suppliers to integrate Kenya into their long term plans, was also there. The new subsidiary will be dedicated to indeterminate tomato seed production. HM. CLAUSE has invested €1.3 million developing the site, which includes the construction of three hectares of greenhouses equipped with a rain catchment and storage system for on-farm irrigation. Nanyuki is located on the equator with extremely favorable conditions for horticultural activities in this region represent a new area of growth for the future of HM. Clause.
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oil is one of our natural resources. Without it, life seems to be very difficult. Hence, to save soil from destroying it IFOAM appealed the whole world to save it on International Mother Earth Day. Studies have shown that at present we are losing about 30 football fields space of soil on every minute. According to FAO the reasons behind this are erosion, compaction, soil organic matter and nutrient depletion, pollution and other processes caused by unsustainable land management practices. Another
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major reason for soil depletion is the use of harmful fertilizers, which was supposed to meet expectations of the farmers to increase the yield. Organic Agriculture does not use soildestroying inputs but stimulates soil organics and improves soil fertility. It helps farmers to adapt to climate change by preventing nutrient and water loss with the help of the presence of high soil organic matter content and soil mulching, making soils more resilient to floods, droughts and land degradation processes.
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