Bengal panchayats to supervise contract farming

The West Bengal government is keen on introducing contract farming but with a difference, and is bent on not labelling it contract farming.

Speaking at a buyer-seller meet organised by the Bengal National Chamber of Commerce & Industry (BNCCI), minister for food processing and horticulture, Sailen Sarkar said that government was trying to create a model where multinational companies would provide inputs to farmers in the form of quality seeds, advanced fertilisers, and other facilities like improved technology and better irrigation techniques through the village panchayat.

The farmers in turn would enter into an agreement that all the produce from the land would have to be sold to the company at a pre determined mutually agreed price "" a sort of forward contract.

When asked if the government was trying to introduce contract farming in the state, he said, "The land would remain with the government and inputs in form of raw materials would be provided by the MNCs to farmers through panchayat so that the local bodies have a say in the whole process. Price would also have to agreed upon jointly by the farmer, the panchayat and the MNC. Hence this model was not contract farming in the true sense of the word. This will help attract multinational companies into the state and provide a boost to the agri-business in the state".

The minister also confessed that lack of direct linkage between the farmers and the end end users have led to emergence of a system where a group of middlemen cornered much of the profit in the agri-commodities chain without adding any value to the products.

The government was trying to remove these middlemen from the system so that farmers could get fair price.

This model involving MNCs and farmers was one such attempt to provide better returns to the farmers. This could also be a process whereby the process of procurement from farmers could be easy and un-interrupted.

Talking on the state of agri-business in the state, Sarkar informed that there were 9,000 small and large food-processing units in the state, of which 80 per cent were smaller ones. The smaller ones were finding it difficult to compete with the larger brands resulting in idle capacity.

Sarkar also said that MNCs have expressed their interest in setting up food processing units for catering to the market and were not interested in installing semi-processed food units.

Hence the potential for the smaller units were in terms of providing semi-processed raw materials to these larger units, in stead of directly competing with them.