India accounts for only 2.5 percent of global agricultural exports, but there is an opportunity to double this figure in the medium term and improve the sector’s economics, says Mr. Sanjiv Puri the Chair of ITC, the Indian conglomerate Corporation on Thursday.
The ITC Chairman Sanjiv Puri stated that there is an urgent need to address the agriculture value chain, which would aid in improving the quality of income in rural areas and ushering in a socio-economic transformation in the country.
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He said this while virtually addressing an event organized by industry body PHD Chamber of Commerce and Industry that there is an urgent need to deal with the agriculture value chain, which would help in improving the quality of income in rural areas and ushering in a socio-economic transformation in the country that there is an urgent need to deal with agriculture value chain (PHDCCI.)
He also stated that the sector requires ‘immediate and substantive transformation’ because it is the most threatened by global climate change.
‘I believe that the most important sector that we must address is agriculture value chains. And I would add wood-based value chains as an opportunity to that,’ Mr. Puri said.
‘At the moment, India accounts for only two and a half percent of global exports due to our productivity and limitations on quality, sustainability, and value addition,’ the ITC chairman explained.
‘The opportunity is very clearly to be able to double it in the medium term, and doubling this offers the opportunity to actually improve, and improve the economics of this sector,’ he said, adding that many policy reforms are needed.
Mr. Puri noted that some work has already been done at the national and state levels on Agri infrastructure, funds, regulations, marketing links, and so on.
‘What we need to envision is a transition from a production-centric agriculture system to a demand-responsive agriculture system,’ he said.
In India, the workforce is also heavily reliant on agri-value chains. The sector provides nearly two-thirds of rural livelihoods and employs roughly half of India’s workforce.
‘Despite having such a large workforce engaged in agriculture, its share of GDP is less than 20%, reflecting the endemic problems of productivity and low incomes.’ So, in terms of the quality of incomes here, this is a serious concern,’ he added.
Mr. Puri observed that the food processing industry, which is located at the crossroads of agriculture and active manufacturing, is an ‘enormous economic multiplier’ and has the best employment-to-capital ratios.
‘It is an industry that generates a significant amount of post-harvest management employment. It also causes inefficiencies and has a positive impact on farm income,’ Mr. Puri explained. Agriculture, he claims, is a sector threatened by climate change, despite being a minor contributor to it.
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‘We have witnessed year after year the devastation caused by extreme weather events on many facets of economic activity, but particularly agriculture, and experts actually predict that by 2050, if climate change continues unabated on its current trajectory, extreme weather events will multiply 75 times,’ he added.
Wheat yields, for example, could fall by half as a result of climate change, he added. Furthermore, India is already a water-stressed country, with 54 percent of the country falling under this category. Agriculture, according to Mr. Puri, is a sector with ‘immense opportunity.’ The world will have 9 billion people by 2050, and India will be the most populous country with 1.5 billion people by 2027.