In a first for the country, as many as 16 Indian companies, including state-run STC, have joined hands to acquire land abroad for reaping fortune from soyabean, sunflower and maize farming.
The consortium, led by Pune-based Pranav Agro Industries and supported by the Solvent Extractors' Association (SEA), has planned to buy 10,000 acres of land in two Latin American countries -- Paraguay and Uruguay -- in the first phase with an initial investment of Rs 200 crore.
"We have approached the Exim Bank to provide financial help to materialise the acquisition of 10,000 acres in Latin America," said Pranav Agro Chairman and Managing Director Pravin Lunkad, who is also the convenor of the consortium.
However, the bank needs to sort out certain issues before it could finance the project, Lunkad said, adding that he is optimistic of obtaining the funds.
The country, already battling an over 12 per cent inflation, is heavily dependent upon the import of edible oils to meet domestic demand even though it is estimated to witness record production in foodgrains this year.
While the domestic edible oils output stands at about 7.5 million tonne, the consumption far outweighs supply at 12.5 million tonne. So any attempt to bridge that gap is likely to pass muster at the government level, an industry expert said.
The consortium has planned to set up a special purpose vehicle in which the companies involved will invest "on a pro-rata basis to acquire the land", Lunkad said. The share of a particular company will depend upon the size of the land it wishes to acquire and the amount of investment, he added.
Though the companies have decided to undertake the farming of soyabean, sunflower and maize initially, plans are being made to include pulses to the list, Lunkad said.
