Successful debut

BS OPINION

 Since the launch in 2001, as many 48 AEZs for promoting the export of a variety of agricultural products have already been approved in 19 states. Some have already begun operating, leading to the export of non-traditional items like litchi from Uttaranchal and gherkins from Karnataka.

 Going by the interest shown by states, many more AEZs may come up in the next few years. No wonder then that the Agricultural and Processed Food Export Development Authority (Apeda), the nodal agency for this scheme, expects an investment of Rs 1,335 crore in AEZs in the next five years.

 What is even more significant, it hopes that over 55 per cent of this investment would come from the private sector. The optimism is, of course, based on the anticipation that the Central and state governments would come up with adequate fiscal sops, including duty concessions, to woo private investment. Such steps have already been taken by the states where these zones are coming up.

 Moreover, the perceptions of the corporate sector have already changed. It has not only shed its reluctance to enter the rural sector but is actually keen to do so. It will therefore be expected to invest in basic infrastructure like power and telecom, and specialised services like cold chains, processing units and logistics for the AEZs.

 The concept of AEZs involves the convergence of on-going government schemes. The strategy centres on a cluster approach for identifying the potential products grown in a contiguous region and adopts the end-to-end approach of integrating the entire process, right from the stage of production till it reaches the market.

 This results in value-addition to basic agricultural produce on the one hand and production cost reduction through economies of scale on the other. Common facilities for research and development and product quality improvement constitute the vital component of this approach.

 Indeed, if the decline in the share of agri-products in the country