Retail FDI needs consensus: Pawar

Agriculture and Food Minister Sharad Pawar today said the decision to allow foreign direct investment in retail in rural areas could only be taken after incorporating views of all those concerned, including the Left.

"The government will have to take bold decisions to increase FDI in rural retail marketing," he said at the Ficci-organised Rural Marketing Summit today.

The minister said rural retail business needed huge investments from both public and private sectors. "We have a two-pronged agenda - pushing through specific enabling reforms in agriculture and to convince the state governments to implement relevant reforms at the earliest," Pawar said.

The minister also expressed concerned over insufficient public and private investment in agriculture.

The plan outlay for the farm sector was only 2 per cent while it was 16 per cent for telecom, he said, while inaugurating the two-day rural marketing summit organised by the Ficci here today.

He also pointed out the incongruity in the Budget which had provided higher allocation for drought relief than for investment in irrigation.

Productivity of most foodgrain crops was way below world averages. There were also signs of plateauing of yields of major crops in most regions.

Degradation of natural resources, particularly land and water, posed a major threat to the future production potential, he said, adding that the efficiency of most inputs, including fertilisers, water and agro chemicals was very low.

Pointing out that the producers' share in prices of perishables was barely 30 to 35 per cent, the minister said there was need to improve post-harvest technologies to retrieve post-harvest losses (reckoned at Rs 50,000 crore annually) and augment supplies.

He said the government was committed to reforms to facilitate large-scale private investment in every step of the value chain. "We have a two-pronged agenda - pushing through specific enabling reforms in agriculture and convincing state governments to implement relevant reforms at the earliest", Pawar said.

Responding to the 15-point agenda for efficient marketing of agriculture inputs put forward by Ficci President Onkar S Kanwar, Pawar said the industry and the private sector had a major role in providing extension services to farmers and developing business models for marketing of their produce.

Pawar said the government had initiated steps to increase agriculture credit. Last year, credit disbursement rose from Rs 80,000 crore to Rs 1,05,000 crore. "We plan to double this in the next two years to tackle the basic problem faced by the farming community", he said.