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Horticulture sector in India: Opportunities and challenges

India must make policy changes to encourage investment in a sector which has a huge foreign exchange and employment generation potential and can play a decisive role in combating the existing nutritional crisis.

By Anubhav Srivastava

October 15, 2009

A visit to the International Horti Expo - 2009 held during at Pragati Maidan in New Delhi provided me an excellent opportunity to gain information about a business segment in which India can truly emerge as global giant – Horticulture. The event organized under the aegis of the Ministry of Agriculture, Government of India showcased India’s potential in the sector.

India ranks second in the world after China in the production of fruits and vegetables. Its diverse agro-climatic regions are ideal to grow a large variety of crops. Occupying 7 per cent of the total cropped area, their contribution to gross agricultural output is more than 18 per cent. The major horticulture crops that are exported from India are – mango, grapes, orange, apple, banana, mosambi, onion, potato, tomato and pumpkins. The biggest buyers of Indian horticulture products are Bangladesh, Nepal, UAE, UK and Malaysia.

Apart from bringing in revenue from exports, horticulture plays a significant role in improving the livelihood of the rural populace. Being labour intensive, it generates a lot of direct and indirect employment opportunities. According to estimates, there is more than 200 million hectares of cultivable wasteland in India which can be brought under cultivation. This move, if implemented, will help the country in a big way to tackle the nutritional crisis. Horticultural products are a rich source of vitamins, minerals, proteins and carbohydrates and other minerals. According to estimates, the per per capita consumption of fruits and vegetables in India is only around 46g and 130g which is far below the stipulation of a minimum of about 92g and 300g respectively as recommended by the Indian Council of Medical Research and National Institute of Nutrition, Hyderabad. 

However, a lot of work still needs to be done before India achieves the optimuim results in the horticulture sector. According to experts, merely producing fruits, vegetables and flowers will not suffice. There is a need of huge monetary investment and proper planning. Government must take measures to promote industries involved in the processing of fruits and vegetables into products like pickles, jams, jellies, squash etc. According to V. Srinivas, Horticulture Officer, Andhra Pradesh State Horticulture Mission, there is a need to have secondary and tertiary industries related to processing of horticulture products in the vicinity of the production area. According to him, there is a need to increase awareness among the farmers about the new methods of agriculture production. 

Another area which is yet to get much attention for the government and the corporate sector is floriculture. States like Uttarakhand, which produces many varieties of exotic flowers, provide huge opportunities in this regard. Dr Brijesh, In-charge of the Government Horticulture Farm in Kashipur, points out to the measures taken by the state government in Uttarakhand like 100 per cent outright excise exemption for the first ten years and 100 per cent income tax exemption for the first five years.

The following are some of the issues that governments, both at the centre and the states, need to sort out in order to encourage further investment and generate greater employment opportunities in the horticulture and floriculture sector – 

  • A large part agricultural land in India is still dependent on monsoons. Developing irrigation facility must be a priority area for the government.

  • The back-up infrastructure facilities like cold-storages, roads and distribution and management of horticulture products must also be given due attention.

  • Farmers in India need to be provided the right technical inputs so that the yield is optimum and of a high quality. Organic farming must be encouraged so that Indian horticulture product are able to compete with those arriving from other countries in the international market.  

  • Research and development is critical and must be promoted in the sector in areas like development of high-yielding variety of seeds and soil testing. 

  • Packaging and marketing of horticulture products is another area that leaves a lot to be desired. Those engaged in the sector should be made aware of the importance of the above two factors in their efforts to increase their reach and market-share.  

  • The farmers involved in horticulture sector should have easy access to financial instruments like micro-credits and loans.

  • Practices like cooperative farming needs to be promoted among the farmers. 

  • Tax structures on horticulture products need to be rationalized so that the cost of the end products can be kept within reasonable limits. 

The above measures, if implemented, will lead to a huge influx of investment in the horticulture sector. And once the sector acquires stability, it will allow the companies engaged in the production and processing of horticulture products, to even get listed in the futures market in order to meet their financial needs.

The author is Editor, Policy Proposals For India. 

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