The PHD Chambers of Commerce and Industry (PHDCCI) has urged the state government to encourage contract farming as a state policy to boost farm business.
According to the PHDCCI study on Agri Business in Rajasthan: Key to Economic Growth, Rajasthan has 16,370 registered small-scale industries in the farm and food processing sector providing employment to 58,196 people. The fixed capital investment in these industries is Rs 420.69 crore.
The state has also received 325 industrial entrepreneurship memorandums from the government for setting up medium- and large-scale industries. The proposed investment for these projects will be Rs 2,722 crore and they will provide employment to about 50,000 people.
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"Encouraging contract farming is important to develop linkages between the farmer, industry and the farm universities," said PHDCCI.
It has also recommended the commission of feasibility studies for setting up food parks and farm export zones because currently the industry suffers from poor and irregular supply of farm material.
There is also an absence of collaboration between processing industries, universities/ research laboratories and farmers, along with lack of market information and market uncertainties.
These, coupled with lack of latest technological know-how and high project cost, makes the units economically un-viable.
Farm export zones for maize, wheat, barley, soyabean, cotton, mustard and spices will give a boost to industries, like corn flakes, starch, flour, noodles, soya meal, cotton seed oil and spices.
According to the study, the state government should direct the two state agricultural universities to undertake initiatives for development and enhance productivity of farm products, offering optimum returns to farmers.
The focus has to be on strengthening research. The private sector companies focusing on biotechnology and use of hybrid seeds should be associated in applied farm research and implementation.
To ensure quality production, soil testing facilities need to be developed urgently and the benefits of bio-technology and tissue culture need to percolate to the farmers. Specific focus need to be on oilseeds and pulses since the country imports these crops.
Investments by private sector companies in farm business for setting up units to develop seeds and planting materials should be encouraged.
Non-forest land and other land available with the state government and panchayats should be made available on long term lease. There is also need to extend the irrigated area, which is currently 25 per cent.
According to the study, the state government should initiate steps to facilitate training and upgrade technology, improve infrastructure, like construction of link roads, rural primary markets, rural godowns, cooperative societies and post-harvest management, to promote growth and indirectly generate employment.
It has also said the government should ensure optimum utilisation of surplus agricultural produce so that farmers get remunerative prices for their produce and are protected from exploitation by middle-men and consumers get quality produce at reasonable prices.
According to the study, policies to encourage small-scale and independent units to form co-operatives for marketing under the common brand should be encouraged.