Planning for plenty

Horticultural production is set to double in the next five years, and a Rs 1,100 crore budget this year will kickstart the process.

The agriculture ministry proposes to raise the annual growth rate in horticultural output to 5 per cent in the 11th Plan from around 4 per cent achieved by this sector since 1991.

This will require almost doubling of horticultural production by 2012, which is the target fixed for the National Horticulture Mission (NHM). This year's budget has set apart Rs 10.15 billion (Rs 1,150 crore) under the Central plan outlay for the NHM to invest on modernisation of this sector.

The NHM has already prepared detailed action plans for 18 states and two union territories for promoting hi-tech horticulture there. Besides, 10 national level agencies have been identified to assist the state governments in this effort. Last year, over Rs 5.6 billion (Rs 560 crore) were released for the NHM till December to initiate various horticulture promotion activities.

The horticulture sector comprises a vast range of fruits, vegetables, spices, medicinal and aromatic plants, flowers, mushrooms and plantation crops like coconut, areca nut, cashew nut and cocoa. These crops put together account for nearly 28 per cent of the agriculture sector's total gross domestic product (GDP).

Statistics compiled by the National Horticulture Board indicate that the area under these crops, which had dropped to 16.4 million hectares in the drought year of 2002-03, has since recovered to cross 20 million hectares.

The total production of all these crops put together, too, had risen from 152 million tonnes in 2002-03 to 165.5 million tonnes in 2003-04, 177.4 million tonnes in 2004-05 and further up to 184.9 million tonnes in 2005-06.

This included 113.5 million tonnes of vegetables, 54.4 million tonnes of fruits, 9.8 million tonne plantations produce, 5.9 million tonne spices and the rest flowers and other minor, though high-value, products.

In fact, floriculture has emerged as the fastest growing sub-sector in horticulture. The domestic market for flowers is estimated to be expanding annually by a whopping 40 per cent. Floriculture exports are also rising, thanks to the availability of transport subsidy for these highly perishable products.

To achieve the objective of stepping up the total horticultural output to beyond 300 million tonnes in the next five years, the NHM proposes to enlarge acreage under these crops, besides induction of modern technology.

The area expansion is sought to be achieved through crop diversification "" shifting land from traditional crops to plantations, orchards, vineyards, floriculture and vegetable gardens.

Only the improved varieties recommended by agricultural scientists and horticultural experts for a particular area would be grown. The relevant cultivation technology, suited to the agro-ecological conditions of the area, would be made available to the farmers.

Besides, the NHM would help in the setting up of post-harvest facilities like pack houses, ripening chambers, cold storages, processing units and marketing infrastructure through the participation of the private sector.

Significantly, the current horticultural promotion strategy, which takes a district as the unit for preparing and implementing programmes, is now proposed to be changed. The new approach will be crop-centred, keeping in view the agro-ecological conditions of the region.

Agricultural research institutions, including state agricultural universities, would also be involved in all stages of implementation of promotional schemes.

SNIPPETS

Global share
Though India is among the world's largest producers of horticultural products, holding second position, next to China, in most vegetables and fruits, its share in the global horticulture export market is negligible.

Notably, this share has tended to decline, rather than expand, despite the efforts to promote exports in the post-reforms era. This reflects fast growth in the overall global horticultural trade and India's inability to grab the emerging opportunities.

According to a recent World Bank-sponsored study, India produces 11 per cent of all the vegetables and 15 per cent of all fruits in the world.

But its share in the world vegetable market in the period 2001-03 was only 1.7 per cent, down from 2.1 per cent in 1991-93. In the case of fruits, too, India's share in the global fruits bazaar has more or less stagnated during this period, being 0.5 per cent in the early 2000s, compared to 0.4 per cent in the early 1990s.

The study has identified the high transportation and delivery costs of India as one of the major factors responsible for the poor export record of this sector. It has estimated that transport costs account for about 45 per cent of the retail prices in air-lifting and 25 per cent in shipping of export cargos.

This makes the Indian products between 5-15 per cent more expensive than their foreign counterparts in the destination markets. As such, it nullifies the advantage Indian horticultural products could otherwise enjoy because of their lower cost of production.

Significantly, the study has concluded that India's share of exports to any destination market declines by 10 percentage points for every 1,000 kms increase in the distance to the market.

Consequently, any market that is beyond 14,000 kms from the Indian borders is unlikely to be available to the Indian exporters for selling their products. It is largely because of this factor that the largest proportion of India's exports of fruits and vegetables goes to neighbouring countries in South Asia.

Imports rise
Imports of horticultural products have risen sharply, especially after the phase-out of quantitative curbs in the post-reforms period. Interestingly, apples alone constitute over 70 per cent of the total horticultural imports.

The distant next items are peas, fresh and chilled, accounting for 8 per cent share and grapes with a 3 per cent share. The rest of the imports are of processed and value-added horticultural products.