FDI in Agriculture-bless or bane?

FDI in Agriculture-bless or bane?

Dr.T.P.Sethumadhavan

In a historical move Government of India on 31st March 2011 brought in a revised policy for foreign direct investment (FDI) in the country. As per the new policy, the norms are extremely relaxed for Foreign Investment, which is expected to create a huge boost in the country’s economy. Major sectors of FDI include Seeds, Plantation, Horticulture, Cultivation of vegetables, Animal husbandry and Fisheries. 100 percent FDI has been allowed in the above sectors including dog breeding. According to the circular by the Department of Industrial Policy and Promotion "Consolidated FDI Policy -- Circular 1 of 2011" while dealing with genetically modified seeds or planting material the company is supposed to comply with safety requirements in accordance with laws enacted under the Environment (Protection) Act on the genetically modified organisms; any import of genetically modified materials, if required, shall be subject to the conditions laid down vide Notifications issued under Foreign Trade (Development and Regulation) Act, 1992; the company shall comply with any other law, regulation or policy governing genetically modified material in force from time to time; undertaking of business activities involving the use of genetically engineered cells and material shall be subject to the receipt of approvals from Genetic Engineering Approval Committee (GEAC) and Review Committee on Genetic Manipulation (RCGM); the Import of materials shall be in accordance with National Seeds Policy.
Circular emphasizes the term “under controlled conditions’’ which covers Cultivation under controlled conditions’ for the categories of floriculture, horticulture, cultivation of vegetables and mushrooms wherein rainfall, temperature, solar radiation, air humidity and culture medium are controlled artificially. Control in these parameters can be made through protected cultivation under green houses, net houses, poly houses or any other improved infrastructure facilities where microclimatic conditions are regulated.

Within Animal husbandry, the term under controlled conditions envisage rearing of animals under intensive farming systems with stall-feeding. Intensive farming system will require climate systems (ventilation, temperature/humidity management), health care and nutrition, herd registering/pedigree recording, use of machinery, waste management systems. Poultry breeding farms and hatcheries where microclimate is controlled through advanced technologies like incubators, ventilation systems etc will also come under this circular.

Pisciculture and aquaculture include aquariums and hatcheries where eggs are artificially fertilized and fry are hatched and incubated in an enclosed environment with artificial climate control.

As a part of the new policy, Government of India has brought significant hopes to oversee firms by permitting equity against imported capital goods and machinery and relaxing the norms regarding convertible instruments and downstream investments. It is expected that the farm sectors of the country would now see huge investments by foreign firms. Indian consumers might see better branding, packaging and glamour in the markets of agricultural sector with 100% foreign investment, but this may affect common consumers through risk of price rise and acquisition or closing down of small sca

ASEAN Agreement

ASSOCIATION OF SOUTH EAST ASIAN NATIONS
ASEAN
Dr.T.P.Sethumadhavan

India signed in the ASEAN Agreement which came in to effect from 1st january 2010 . Specific areas under the ASEAN cooperation in food, agriculture and forestry include food security, food handling, crops, livestock, fisheries, agricultural training and extension, agricultural cooperatives, forestry and joint cooperation in agriculture and forest products promotion scheme.

Objective

The basic objective of the ASEAN cooperation in food, agriculture and forestry is to formulate and implement regional cooperation activities to enhance the international competitiveness of ASEAN’s food, agriculture and forestry products as well as further strengthen the food security arrangement in the region and the joint positions in international for a.

Mandates

• To strengthen food security in the region
• To facilitate and promote intra and extra ASEAN trade in Agricultural and forestry products
• Generation of transfer of technology to increase productivity
• Private sector participation
• Promote agriculture extension and rural development
• Management and conservation of natural resources for sustainable development
• Address international and regional issues.


Sector B-Agriculture

B3. SUB-SECTOR: LIVESTOCK

STRATEGIC THRUST 2: ENHANCEMENT OF INTERNATIONAL COMPETITIVENESS OF ASEAN FOOD AND AGRICULTURAL PRODUCTS/ COMMODITIES

Action Programme 1:

Enhancement of intra- and extra-ASEAN trade and long-term competitiveness of ASEAN's food and agricultural products/commodities.

1.1 Monitoring of the implementation of the CEPT Scheme for AFTA for livestock and livestock products.

1.1.1 Monitoring of number of tariff lines in CEPT Scheme lists (Inclusion List, Temporary Exclusion List, etc.) and trade values by the ASEAN Secretariat and reporting to WGL meetings. (2005-2010)

1.2 Intensification of cooperation in production and processing technology development and transfer and enhancement of development, harmonization and adoption of quality standards for products through:

1.2.1 Establishment of an accreditation scheme for livestock and livestock products that are widely traded between ASEAN Member Countries. (2005-2010)

(i) Develop and finalise criteria for accreditation of livestock establishments
1. Ducks for slaughter.
2. Dairy Cattle
3. Duck eggs
4. Horses for sporting event
5. Porcine semen and embryo
6. Bovine semen and embryo.
7. Sheep and goat for Breeding and Slaughter

(ii) Develop and finalize criteria for accreditation of livestock product establishment.

1. Poultry processing plants.
2. Meat processing plants.
3. Cattle slaughterhouse
4. Milk processing plant
5. Ice cream processing plant
6. Yoghurt processing plant
7. Canned (thermo-processed meat plant
8. Compounded animal feed plant
9. Egg processing plant

(iii) Workshop on Risk Analysis
(iv) Workshop on Hazard Analysis and Critical Control Point (HACCP).

1.2.2 Strengthening animal diseases control programme among ASEAN Member Countries. (2005-2010)

(i) Control and Eradication of economically important animal diseases: FMD; Avian-flu; Classical Swine Fever.
• Establishment of Foot and Mouth (FMD) Diseases Free Zones in ASEAN Member Countries.
• Establishment of Animal Health Trust Fund

(ii) ASEAN Mekong Basin Livestock Development Cooperation:
• Mekong Basin Animal Quarantine Network

(iii) Develop equivalent animal disease diagnostic technique amongst ASEAN Member Countries. (2005-2008)

1.2.3 Facilitation of the intra-ASEAN trade in animal vaccines. (2005-2010)

(i) Accreditation of animal vaccine testing laboratories in ASEAN Member Countries.
(ii) ASEAN Register of Animal Vaccines.
(iii) ASEAN Standard Requirements for Animal Vaccines.

Fisheries

Action Programme 1:

Enhancement of intra- and extra-ASEAN trade and long-term competitiveness of ASEAN's food and agricultural products /commodities.

1.1 Monitoring of the implementation of the CEPT Scheme for AFTA for fisheries products.
(2005-2010)

1.1.1 Updating of the number of tariff lines of fisheries products that are in the Inclusion List (IL), Temporary Exclusion List (TEL), General Exception (GE) and Sensitive List of the CEPT Scheme.
1.1.2 Monitoring of tariff reduction schedules of the fisheries products in the IL.

1.2 Intensification of cooperation in production and processing technology development and transfer and enhancement of development, harmonization and adoption of quality standards for products.

1.2.1 Standardization of Quality control measures and processing techniques for fish and fisheries products.

i) Implementation of AADCP project on Quality Assurance and Safety of Fish and Fishery Products- HACCP Approach (2004-2007)

1.2.2 Standardization and development of good aquaculture practices, particularly for shrimps. (2005-2010)

i) Establishment of the ASEAN Network on Cultured Shrimp Inspection Authority (2005)
ii) Assuring Quality and Safety in Shrimp Aquaculture Production and Trade


1.3 Harmonization of fisheries SPS measures among ASEAN Member Countries.(2005-2010)

1.3.1 Encourage and educate the fishery stakeholders to enable production of fishery products through a Code of Conduct measures issued by FAO to promote the development of “Made in ASEAN” products and services. (2006)
1.3.2 Comply with Good Aquaculture Practices (GAP) in order to produce a better quality of aquaculture products that can compete in the international markets as an ASEAN Product
1.3.3 adopt the WTO Agreement on Sanitary and Phyto-Sanitary Measures and develop implementation guidelines appropriate for ASEAN (2008)
1.3.4 Comply with Hazards Analysis Critical Control Point standard unanimously among ASEAN countries that have been approved by WHO and FAO
1.3.5 Establish MRA for selected fisheries products. (Ongoing exercise)

1.4 Study to Strengthen the Competitiveness of ASEAN Fisheries Products in International Markets. (2005-2010)

1.4.1 Specification of problems and constraints facing production of fisheries products in view of competitiveness in international markets.
1.4.2 Formulation of appropriate measures to integrate efforts of ASEAN Member Countries in a common programme


Agreement Establishing the World Trade Organization
The agreement establishing the World Trade Organization (WTO) calls for a single institutional framework encompassing the GATT (General Agreement on Tariffs and Trade 1994) as modified by the Uruguay Round.
Uruguay Round Protocol GATT 1994
For agricultural products, as defined in Article 2 of the Agreement on Agriculture, the staging of reductions shall be implemented as specified in the relevant parts of the schedules.
Agreement on Agriculture
The negotiations have resulted in four main portions of the Agreement; the Agreement on Agriculture itself; the concessions and commitments Members are to undertake on market access, domestic support and export subsidies; the Agreement on Sanitary and Phytosanitary Measures; and the Ministerial Decision concerning Least-Developed and Net Food-Importing Developing countries.
Overall, the results of the negotiations provide a framework for the long-term reform of agricultural trade and domestic policies over the years to come. It makes a decisive move towards the objective of increased market orientation in agricultural trade. The rules governing agricultural trade are strengthened which will lead to improved predictability and stability for importing and exporting countries alike.
The agricultural package also addresses provisions that encourage the use of less trade-distorting domestic support policies to maintain the rural economy, that allow actions to be taken to ease any adjustment burden, and also the introduction of tightly prescribed provisions that allow some flexibility in the implementation of commitments. Specific concerns of developing countries have been addressed including the concerns of net-food importing countries and least-developed countries.
The agricultural package provides for commitments in the area of market access, domestic support and export competition.
In the area of market access, non-tariff border measures are replaced by tariffs that provide substantially the same level of protection. Tariffs resulting from this “tariffication” process, as well as other tariffs on agricultural products, are to be reduced. Reductions are to be undertaken over six years in the case of developed countries and over ten years in the case of developing countries. Least-developed countries are not required to reduce their tariffs.
The tariffication package also provides for the maintenance of current access opportunities and the establishment of minimum access tariff quotas Domestic support measures that have, at most, a minimal impact on trade (“green box” policies) are excluded from reduction commitments. Such policies include general government services, for example in the areas of research, disease control, infrastructure and food security. It also includes direct payments to producers, for example certain forms of “decoupled” (from production) income support, structural adjustment assistance, direct payments under environmental programmes and under regional assistance programmes.
The Agreement on Agriculture provides for some limited flexibility between years in terms of export subsidy reduction commitments and contains provisions aimed at preventing the circumvention of the export subsidy commitments and sets out criteria for food aid donations and the use of export credits.
“Peace” provisions within the agreement include: an understanding that certain actions available under the Subsidies Agreement will not be applied with respect to green box policies and domestic support and export subsidies maintained in conformity with commitments; an understanding that “due restraint” will be used in the application of countervailing duty rights under the General Agreement; and setting out limits in terms of the applicability of nullification or impairment actions. The agreement sets up a committee that will monitor the implementation of commitments, and also monitor the follow-up to the Decision on Measures Concerning the Possible Negative Effects of the Reform Programme on Least-Developed and Net Food-Importing Developing Countries.
Agreement on Sanitary and Phytosanitary Measures
This agreement concerns the application of sanitary and phytosanitary measures — in other words food safety and animal and plant health regulations. The agreement recognizes that governments have the right to take sanitary and phytosanitary measures but that they should be applied only to the extent necessary to protect human, animal or plant life or health and should not arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail.
In order to harmonize sanitary and phytosanitary measures on as wide a basis as possible, Members are encouraged to base their measures on international standards, guidelines and recommendations where they exist. The Agreement spells out procedures and criteria for the assessment of risk and the determination of appropriate levels of sanitary or phytosanitary protection.

GM research

New regulations for GM crops and research
Dr.T.P.Sethumadhavan
Recent supreme Court of India's order directing the Government to publicise the results of trials on the safety of genetically modified (GM) food items represents a breakthrough in the campaign for biosafety regulations in India.ccording to Suman Sahai, Convener of Gene Campaign. The Genetic Engineering Approval Committee (GEAC)has been directed to consider the toxicity and allergic nature of GM foods. The order asked the Government to post the relevant material on the web so that independent experts can examine it.The committee has been asked to study the isolation distance of experimental fields from neighbouring fields to prevent contamination.
globally almost all countries including US started revising regulations on GM products. existing protocols for biosafety are extremely inadequate. Recently Mexico had imposed a ban on cultivation and research on GE corn.

Livestock sector and Economic Renaissance

Livestock sector and Economic Renaissance

Dr.T.P.Sethumadhavan

India is blessed with enormous animal wealth comprising 54%Buffaloes, 16%cattle, 21%goats, 5%sheep and 2%poultry population of the world. The country has 187.38 million cattle, which is about 15% of the world cattle population, of which around 12. 07 % are crossbred. Tamilnadu, Maharashtra, Kerala, Uttar Pradesh, Karnataka and Punjab account for 60 percent of the crossbred cattle population. 96.62 million Buffalo population in the country comes around 56 percent of the world Buffalo population. Indian livestock wealth worth Rs80000 Crores contributes Rs183000 Crores to the National GDP, which is over 1\3rd of the contribution from agriculture. Livestock sector provides employment to 70% of the population in rural areas. India is the highest milk producing country in the world with an annual production of over 92 million tones of milk. USA stands second with 71 million tones of milk. Out of 210 million cattle and 75 million buffaloes, more than 54 of milk is from buffaloes; which constitute around 33 Percent of livestock population. In terms of economic accomplishment, milk is number one farm commodity towards contribution to National economy. Per capita milk availability has touched now 238 gm per day. India today is the lowest producer of milk in the world in dollar terms at 27cents per litre compared with USA 63 cents and Japan’s 2.8 dollars. Major share of growth is attributed to dairy and poultry sectors. Country’s livestock population continues to grow steadily, especially among goats and poultry.

Of the total households in rural areas, about 73 percent own livestock. Income from livestock sector accounts for 15-40 per cent of total farm household incomes. Small and marginal farmers account for three fourth of this household raising 56 per cent of Bovine population. As per recent analysis of Associated Chambers of Commerce and Industry of India, farm sector can generate 13.7million jobs in the livestock sector alone. Livestock sector contributes 30 percent of the total income from agriculture in the country, whereas in southern states it is more than 40 percent. Annual growth rate in agriculture during the year 2007-08 is only 2.6 Percent, whereas in livestock sector it is more than 4 times in agriculture. Commodity share is 3.53 as against 3.5 in agriculture. More than 70 percent of the rural households in India depend on livestock sector for supplementary income. Economic review suggests that women carry out more than 90 percent of the activities related to care and management of livestock.


Analysis of the trends over the last two decades indicates that the growth in poultry and dairy sectors has exceeded the growth in cereal production. This may be due to rapid urbanization, population growth, rising levels of income and falling prices of livestock products. There are certain indications, which suggest that the demand led livestock growth is expected to continue and by 2020 more than 60 percent of meat and 50 percent of milk will be produced in the developing countries. China and India are likely to emerge as the primary producers of meat and milk respectively.


Even though India is the largest milk producing country in the world, Productivity per animal is only less than 50 % of the world average. This is mainly due to poor level of nutrition and low genetic potential for milk production and health care. Projected gap between demand and supply of green and dry fodder presents a challenge for fodder production in the coming years. Studies done by NDDB revealed that 45% milk is consumed as liquid milk, 28% as Ghee, 6 percent as Butter, Khoa and 7 percent as Dahi and 2.6 % as milk powder. In general consumption expenditure on milk and milk products is next to cereals and is rising steadily over the years. Demand elasticity estimates of Indian dairy industry for milk and milk products combined are 1.65 in rural and 1.15 in urban India. (Dutta and Ganguly 2000). Moreover expenditure elasticity of demand for milk and milk products for lower income class is considerably greater.

Livestock markets in the world are changing dramatically. In the developed world demand is relatively stable and there are increasing concerns over the systems of livestock production and safety of livestock products. The picture in the developing country appears markedly different. Demand for livestock products is predicted to increase by 5 % or more per annum. This demand for livestock products will be met from different sources, largely domestic but also international.
It is expected based upon the extrapolations from current livestock trade pattern that most of the projected increase in the livestock demand will be met from within the developing world. Meeting this demand will require enormous increases in supply of feeds and other inputs, scaling up of livestock production, processing, distribution and marketing and much improved systems for assuring the quality and safety of livestock products for the consumers. Avian Flu, SARS, Foot and mouth Disease, etc, is influencing the changing patterns of livestock production associated with livestock revolution.

How poor will benefit from the increasing consumption of livestock products will depend on a number of policy, technology and research choices. There is evidence from several countries that small holders are very competitive under the right circumstances (Delgado et al 2001).

Market opportunities for the poor can be greatly improved by paying specific attention to social equity and environmental issues that are at present largely ignored. Selective investments in infrastructure, co-operatives, contract farming arrangements and other pro poor market mechanisms. Public support is required for appropriate health and food safety systems that benefit the poor. These changes will require new ways of doing business and strategic research that targets the priority concerns of the poor. There is great potential for increasing the assets, incomes and food safety of the poor from livestock production, marketing and consumption.

While giving emphasis to production, marketing of the livestock products were not given due attention. Scientific breeding, feeding, management and disease control has been given due importance. When the issue of sustainability arises marketing will come in to picture. Livestock products except around 15 % of the milk produced are mainly traded through unorganized sector. In order to explore the rural market for livestock products our production strategy need to be market oriented in nature. It should be in tune with local, domestic and international market. Production and branding of traditional livestock products, which fetches good price, should be promoted.

There are certain pre requisites for popularizing market oriented production strategy for livestock products in the country. It should be economically viable. Cost of production has to be reduced considerably without affecting the quality of products. Changes in the extension approach, market forecasting system, value addition, awareness on diseases affecting trade of livestock products, consumer behavior, production of livestock products based on the demographic characteristics of the population, good manufacturing and retail practices, best production practices and implementation of food safety norms, etc need more emphasis.

Extension approach should be need based and participatory in nature. It should be an integrated systems approach having problem-solving dimension. This so called strategic extension approach should make all efforts to improve the production while giving due attention to marketing. Farmers need to be given more awareness on value addition, food safety norms, branding and problems and prospects of marketing including the four cardinals of marketing like product, price, promotion and place. As told by the world marketing Guru Philip Kotler in today’s world of IT explosion branding is becoming more important than before. One needs to redefine the role of marketing as creating, communicating and delivering value to the consumer. Value addition of livestock products should be based on consumer needs and taste, like fat free milk for cardiac patients, chocolates for children, quality cheese for international market, etc.

Rapidly increasing demand for livestock products, along with the changes in international trade, is placing pressure on Asia's livestock sector both to expand and adapt. This adaptation takes the form of two major shifts - a shift in livestock functions and species, and a shift in agro-ecological and geographical zones, involving structural and technological changes. Today, non-food functions of livestock are generally in decline and are being replaced by cheaper and more convenient substitutes. At the same time, financial institutions are replacing the asset, petty cash and insurance functions of livestock as even remote rural areas enter the monetary economy. Except for some parts of South Asia, the animal as draught power is declining as more farmers mechanize, partly attracted by government subsidies. Manure continues to be important in mixed farming but its role in overall nutrient supply is diminishing because of the competitive price and ease of management of inorganic fertilizer. The same applies to animal fibres: although the demand for natural fibres is still high, and in many places even increasing, there are a growing number of synthetic substitutes for wool and leather.
Connected with this is an increasing selectivity as to the parts of the animal used for food. Now the trend is towards lean meat, and other products - such as offal, blood and bone - are being increasingly used industrially, or recycled as feed. Thus, there is a trend from multi-purpose to single purpose animals, with animal protein the overriding objective. This is also reflected in the choice and manipulation of genotypes, which favor specialization over product diversity. Another trend is the growing importance of monogastric as economic converters of concentrate feed.
Two other basic trends can be observed: livestock production is growing faster in the moist parts of the region, and it is moving closer to urban settlements. In Asia, as in the rest of the world, it is the humid and sub-humid zones that still offer a large potential for agricultural production. Human populations are increasing over-proportionally in these areas while other zones, such as arid and highland areas have reached a level of population density above which significant increases can no longer be sustained. Livestock populations are increasing faster in the moister areas than in other zones.
Structural changes. Two important structural changes apply across production systems: a general growth in scale and a trend away from horizontal to vertical integration. Levels of livestock production and processing are increasing in response to technological development, market requirements and insufficient returns to labor in traditional systems. Where alternative employment opportunities exist, such as in the rapidly industrialized countries of the region, traditional subsistence-orientated livestock farming is often abandoned, opening up market and expansion opportunities for other farmers or commercial entrepreneurs.
In particular, poultry production has often developed from a simple farm operation to a complex vertical operation of related industries and enterprises, including grain production for animal feeds, feed mills, slaughterhouses and processing plants, food chain stores and wholesale enterprises.
Further structural changes relate to the new trends in the importance of different production systems. The growth potential for extensive grazing and roughage production is limited. In response to increased population pressure, good pastureland is being converted into cropland, leaving increasingly poorer land for grazing and mixed farming. Industrial production of pigs and poultry is therefore increasing relative to production from grazing and mixed farming systems. Pork and broiler production will also increase relative to ruminant meat production. This is a direct result of the better conversion efficiencies of concentrate feed in pigs and poultry.
Faced with increasing resource constraints that stem from a small land base, countries resort to importing meat and other livestock products to satisfy the growing demand. This is evidenced by a growing trade deficit in these products. The developing countries of Asia had a net trade deficit of 313,000 tons of ruminant meat and a net trade surplus of 409,000 tons of monogastric meat. While the region as a whole is self-sufficient in all livestock products, there are important differences between the sub-regions. Australia and New Zealand make up for the deficit of the other sub-regions, particularly for beef and milk.
Technological changes. In line with the structural changes outlined above, the development, transfer and adaptation of technologies will focus on improving efficiency of feed utilization and increasing animal productivity. Feed requires land for production and this continues to be the limiting factor to the sector's expansion even if countries resort to feed imports. Continuing industrial development in the region will also make traditional livestock raising practices less competitive because of diminishing returns to labor, even though this process will be very gradual.
We are therefore witnessing a dualistic mode of development, with two conflicting components. First, a modern, demand-driven and capital-intensive sector, producing poultry meat, eggs, pork, and sometimes milk, increasingly uses state-of-the-art technologies. It is rapidly expanding to meet urban demand but it is also susceptible to market upheavals; it generates little employment, poses great environmental risks because it tends to concentrate in areas with good market access, and it creates a number of new challenges for human and veterinary public health. Technology uptake has been fast, driven by commercial interests.
At the same time, a traditional, resource-driven and labor-intensive sector continues to provide a multitude of services to subsistence-oriented farms. While not efficient in terms of introduced inputs, this sector uses resources of little or no alternative uses, and for the same reason, its potential to expand beyond moderate growth rates is constrained by low technology uptake, insufficient market facilities and infrastructure, and small economies of scale. Often, these systems are closed cycles of nutrients, farm labor, energy, etc. Unless these cycles are broken, technology uptake will remain constrained.
Production system pathways. Livestock systems develop in response to resource endowment and market opportunities. Grazing systems have limited scope for expansion. Mixed farming systems will see continued intensification and important growth, with livestock based on crop by-products and surplus. Some productivity gains can be achieved by further enhancing nutrient and energy flows between the crop and livestock component. Mixed farming system may be threatened by the disappearance of livestock, triggered by population pressure, fragmentation of arable land, poverty and lack of market access.
Under more favorable agro-ecological and market conditions, industrial systems have emerged, in parallel with, and sometimes supplanting, mixed farming systems. Because of generally poor infrastructure and institutions, these are usually established close to demand centers, resulting in excessive animal densities, nutrient surpluses and other environmental and human health problems that highlight an "urban trap": while profitable in the short run, these systems cannot be sustained in urban or peri-urban environments. Such considerations caused, for example, Singapore, to abandon livestock production altogether. The answer is to allow specialized commercial production to operate in an area-wide concept where nutrient balances are maintained and the land's capacity to absorb animal waste is respected.
The evolutionary and significant trends described above must, if they are to be sustainable and progressive, take into account their impact on the public domain or public goods. These face four main challenges which include: the contribution of livestock to food security and food production; the protection of the environment in the face of increasingly intensive farming methods; the maintenance and generation of social equity which may be jeopardized by industrialization and job loss; and the protection of human health and welfare.
It is therefore essential that policy makers and planners responsible for livestock development define future strategies in the broader context of human development and the sustainable utilization of our limited natural resources.

Quantum jump in per capita consumption of milk, meat and eggs

Quantum jump in per capita consumption of milk, meat and eggs
Dr.T.P.Sethumadhavan
Increasing per capita consumption of milk increases the domestic demand of milk. As domestic consumption of milk increases, as a result of wide demand supply gap scarcity arises. Even though consumption of food grains has decreased during the year 2007-2008, animal protein sources like milk, meat and eggs shows a positive trend. This emphasizes the need for increasing domestic production to meet the ever-increasing need for animal protein sources. As India is growing richer, Indians are growing hungrier. Annual per capita cereal and pulses availability has declined from 457 gm and 40.16 gm respectively in 1995 and to 391 gm and 31.5 gm respectively in 2005.

The per capita daily cereal availability is lower than 393.1 gm of cereal and almost 47 percent of the 67.2 gm of pulses available in 1960 to the Indian population. But Indians are eating more meat and eggs. Per capita egg consumption is expected to close at 43 eggs in 2007-08 while broiler meat at 2 kg. It is expected to reach 50 eggs per year and 2.3 kg per year of broiler meat by 2010. Per capita milk consumption in 2007-08 is about 238 gm/day. It is expected to reach 262 gm/day by 2010. Inorder to increase more quantity of animal protein sources to meet the increasing needs of the population; sufficient quantity of grains like maize will be required at a reasonable price. Moreover rate of agricultural growth fell from 5 percent in the mid 1980s to less than 2 percent in the last 5 years. India is facing a demand- supply mismatch in the case of food grains despite having produced a good quantity of wheat and rice last year.

Bitech markets in Asia

GM crops in India

Dr.T.P.Sethumadhavan

Genetically modified technology has always attracted skepticism, resistance and controversy, yet its use continues to grow in many parts of the world. Says US Grains council. Despite pest and pricing worries, many Asian countries have welcomed biotech crops. Be it farmers in India, China, Vietnam or Philippines, it is all over Asia and the Indian subcontinent that farmers are happy with the use of new products on offer in the agriculture marketplace. Public sector institutions presently carry out majority of developments in crop biotechnology. According to the International Service for the Acqisition of agri-biotech applications, the total area of approved GM crops reached 102 million hectares in 2006. Of the 9 million hectares in India about 38 percent was on Bt Cotton in 2006 and the area coverage is expected to increase to 75 percent by 2010. While Governments and environmental groups argue over the safety and morality of GM crops, many farmers in Asia are quietly working with scientists to overcome minor problems they are experiencing with this technology. In India agriculture biotechnology space has grown in the past one decade and has witnessed projects in large number of private and public sector. The investment has also shifted to some extent purely application oriented research to a mix of basic and applied research. Several biotech companies catering specialized research services to seed companies lack in house research facilities, which creates opportunities in agri biotechnology.
India had realized several years back that to increase food, feed and fiber production from the current level, use of biotechnology is imperative. Several institutions under Indian council of Agricultural Research and Council for Scientific and Industrial Research under department of Biotechnology, Government of India are actively applying biotechnological tools to enhance productivity and quality of agricultural crops. Agricultural universities, traditional universities and other R&D institutions are funded by DBT through external grants to support research on transgenic crops. Bio-safety of Biotech crops is one of the growing areas of research in the Biotech sector.

WTO cell to study Global market issues.

WTO cell to study Global market issues.
Dr.T.P.Sethumadhavasn
The World trade Organization envisages free trade of products in a transparent and competitive environment leading to smooth trading activities. Several agreements on Agriculture tariffs, subsidies, sanitary measures and intellectual property rights came under a single roof World Trade Organization (WTO) as GATT agreement. 100 countries including India knowingly or unknowingly entered in to this global trade regime to promote economic development across the globe. WTO forces member countries to open up their economy to a free flow of imports and exports. Market access, domestic market and TRIPS are the key elements pertaining to WTO in the Agriculture sector. Consequent to WTO norms Government of India lifted trade barriers of over 1500 items including livestock products like milk, meat, milk products, meat products, leather, etc. Import duties and restrictions may hasten in flow of cheap goods, which attracts urban consumers. In order to exploit the international market export potential has to be exploited.
During the last four decades Kerala witnessed a spectacular growth in the livestock sector. Total volume of output of Livestock is 56115.67 million rupees as against 139186.26 million rupees from agriculture. Kerala’s agrarian economy has even higher intensification of livestock sector. Commodity share is 3.53% in Livestock sector as against 3.5% in Agriculture. Compared to annual growth rate of 0.9% in agriculture, livestock sector is growing at the rate of 3.8%. Per capita consumption of milk has reached 226 gms per day. More than 95% eggs produced in the state are from backyard sector. Meat sector is still in the unorganized sector. We are unable to meet the increased demand. In order to increase the production and consumption of meat, production strategies has to be reoriented in such a way that measures to implement TQM, HACCP and to reduce cost of production has to be followed. Marketing potential in this sector has to be integrated with the production sectors. In this juncture an organization to study trade related issues of livestock products play a key role.

Some of the major points of concern are-
1. Kerala cannot exploit the market potential of meat and meat products since it is mainly unorganized in nature.
2. Per capita meat consumption in the state is far below the NIN/ICMR recommended level.
3. Emerging competition from developed/developing countries.
4. Increased land pressure and reducing livestock holdings.
5. Reducing profitability from livestock sector in the state.
6. Relatively low production of value added products.
7. Non-availability of subsidies.
8. Untapped potential of livestock products trades in the international market.
9. Lack of awareness on impact of globalization in the livestock sector.
10. Import of livestock products from abroad.
Trade issues in Animal Husbandry need to focus the following areas –

1.Measures to enhance market access for Kerala’s livestock products
2.Extent and scope of value addition of animal products
3.Extent of impact of imports (duty free/duty paid) on our market access (domestic/external).
4.Measures for domestic support/export subsidies
5. Unorganized export promotion programmes.
6.Non-tariff barriers like information on rejection of consignments and time bound data.
7.Sanitary and phyto sanitary measures and quality restrictions.
8.Issues related to tracebility, residue monitoring
9.Documentation of indigenous knowledge practices
10.Conservation issues related to indigenous breeds of livestock and poultry.


Objectives: -

1.To analyze the measures needed to enhance market access for Kerala’s livestock products
2.To study the extent and scope of value addition of animal products consequent to globalization
3.To analyze the extent of impact of imports (duty free/duty paid) on our market access (domestic/external).
4.To identify the guidelines needed for domestic support/export subsidies
5.To strategically evaluate and suggest needed recommendations for Export promotion programmes.
6.To analyze Non-tariff barriers like information on rejection of consignments and time bound data.
7. To identify the guidelines needed for Sanitary and phyto sanitary measures and quality restrictions.
8. To study the issues related to tracebility, residue monitoring
9.Documentation of indigenous knowledge practices
10.To analyze the conservation issues related to indigenous breeds of livestock and poultry.
11.To study participatory trade related issues with industries in the livestock sector.

Mode of functioning-

The WTO cell is a broad based one, which will explore the possibilities of marketing of livestock products in the State/National/International level with the envisaged objectives. It will undertake projects in association with UNCTAD, FAO, Agricultural Universities, public sector undertakings, SHG’s, NGOs, etc. It will analyze the trends in livestock rearing in the state with experts working in livestock development departments, MPI, KLDB, KCMMF, NGOs, exporters, industries etc.

WTO cell will work as an autonomous body under Animal husbandry department. Secretary (Animal Husbandry and Dairying) and Director, Department of Animal husbandry will be the patrons. The cell will incorporate Selected officers from the Animal Husbandry department, CDS, selected scientists, economists, law professionals from across the country. Representatives from ASSOCHAM, CLFMA, EPZ, Poultry and processing sectors will be included in the participatory study programmes. Special officer in charge of the WTO cell will co-ordinate the activities in a time bound manner.
Outcome of the study: -
The WTO cell will assess the demand and supply of Animal products, external and internal environment pertaining to livestock product trade in the state, country and abroad in the areas of market access, non trade barriers and intellectual property rights.