Prof K S Chandrasekar
India thrived primarily on agriculture for centuries. Western world usually call India as Agrarian economy. Share of GDP of Agriculture declined from about 50% during Independence to about 18% in 2024 which provides a livelihood for about 42.3% of India’s population. Hence it is still the most important sector. Agriculture in the twenty-first century is reinventing itself as a new global business reshaped by globalization, standardization, high-value production, massive growth in demand (both for the food and the biofuel industries), retail and packaging innovations, and a ramp up in efficiency. Faced with constant productivity and market pressures, the “new agriculture” needs new tools to enhance its competitiveness and innovation capacity. One of these tools is the promotion of clusters.
The shift in agriculture within developing countries from traditional cereal grain production to high-value agricultural products (HVPs) is a remarkable evolution that promises both challenges and opportunities. This transformation is driven by the need to meet the stringent quality and safety standards demanded by export markets and supermarkets. India has been known to bring out agricultural produces than the products owing to the large population. The concept of Agro-Based Clusters (ABCs) plays a pivotal role in this evolution, forming the foundation for geographic concentration of agricultural production and processing activities.
The 2024-25 Union Budget of India allocated 1.52 trillion rupees to the agriculture and allied sectors. This is a significant increase from the previous year’s budget. 10,000 need-based bio-input resource centres to be established during the period to ensure better productivity. Large scale clusters for vegetable production will be developed closer to major consumption centres. There are Agro-based clusters, integrated farming clusters, Vegetable clusters and Organic village clusters. The farming clusters include Grapes in Maharashtra, Mango in Andhra Pradesh, Pomegranate in Sholapur, Onion in Maharashtra, Turmeric in Kerala and Dairy in certain regions in Punjab and Gujarat. However, the success of these clusters is contingent upon their ability to transition from simple Farming Clusters (FCs) to Industrial Clusters (ICs) capable of significant value addition.
Clusters can help in collaboration among different manufacturers within the cluster to share knowledge and resources, establishing common facilities like testing centers to ensure product quality standards and facilitating access to market information and technology updates through industry associations. This concept leads us to Increased productivity, Enhanced product quality, Market competitiveness: Ability to produce innovative and efficient implements to cater to evolving farmer needs. In turn it leads to Economic growth with Creation of new jobs and increased revenue generation within the agricultural machinery sector. Implementation strategies are based on Government initiatives through providing financial assistance, training programs, and technology transfer support to agricultural implement clusters. There is also more awareness to be given in terms of partnerships between manufacturers, research institutions, and skill development organizations and Capacity building programs.
As per the Food and Agriculture Organisation (FAO), India is the 2nd largest producer of fruits and vegetables globally, behind China. It has an 11.4% share in global fruit production and 12% share in global vegetable production, India has had little success in the export of these products. One of the major factors limiting the growth of its agro-export industries, particularly given the reduction of many trade barriers, is the inability of its small holder dominated production systems to meet the food safety requirements of export markets. By the 1970s the association was seeking technical advice from scientists. A good example of the improvements this research produced is the introduction of gibberellic acid to the cultivation process. Because the acid was not available locally, the association facilitated its importation by getting the import duty reduced and supplying the chemical to members at cost. The central government acted to encourage the development of infrastructure and established the National Horticulture Board (NHB) and the Agricultural and Processed Food Products Export Development Authority (APEDA). In order to facilitate these tasks, in 1991, Mahagrapes was formed. It represents a public-private partnership (PPP), being owned and governed by its members (grape cooperatives) but with considerable public support in its set-up. To support the initiative, the state marketing board paid the salaries of the governing body for the first three years and provided for consultancy services, while the National Cooperative Development Corporation (NCDC) and the state government provided loans. Thus the cluster concept came into picture. The integration of research, consultancy and associational activities with the support of the agencies, government and grape growers led to the success of this cluster. Mahindra Shubhlabh Services Ltd, the agribusiness arm of the large Mahindra Group conglomerate, has recently become involved in the cluster.
Agricultural implements are tools and machines used to perform farming tasks. They include tractors, plows, harrows, seed drills, and silos. An “agricultural implements cluster” refers to a geographical area where a concentration of businesses related to the production, distribution, and servicing of agricultural tools and machinery are located close together, allowing for collaboration, shared resources, and economies of scale within the sector; essentially, a community of companies focused on agricultural equipment development and supply within a specific region. The Karnal-based units created a cluster to meet the major requirement of the country for various types of power driven and bullock driven agri-implements, including harrow disc, tiller tyne, seed drilling machine, zero tillage leveler, agri-springs and laser guided scraper buckets. State of art training facilities like Common Facility Centre with Mini Tool Room, Metallurgy, Chemical Testing & CAD CAM Facilities were put up. The cluster identified more than 40 countries for exports. One of the difficulties the entrepreneurs felt was that the repercussions of this year’s monsoon would be felt in the next kharif crop as the demand in the drought-affected areas would be affected. Major units which are into exports are already battling the slowdown in the world economy as their business have been hit by almost 50 per cent in value. In the past few years, some of the larger players forayed into exports and created a room for the new units, mainly small and micro outfits, to cater to the domestic market. The cluster has over 100 micro, small and medium units and provides employment to about 5,000 people. While the DPR was submitted, it projected a total of Rs.650 Crores turnover. Despite the slack demand in the global market, the entrepreneurs are engaged in doing ground work to access new markets. Some of the players are exploring export opportunities in African countries as they are aggressively implementing mechanisation.
Jammu and Kashmir is famous for its basmati rice, cherries, trout, walnuts, apples, apricots, cherries, pears, plums, almonds and saffron, however currently it has only farming clusters, craft clusters and other agribased clusters. Even though they are farming clusters, the movement to industrial clusters is yet to take off. It is important that the government need to make sure that there is more rupee per yield which will increase the morale of the farmers and will concentrate on working further. Skill development to migrate to industrial clusters needs to be provided to these farming clusters so that they become productive at large. The possible areas could be training in modern agro farming techniques, enhancing design skills to incorporate new features and functionalities, Quality control, Safety training, adoption of new materials with improved durability and performance, implementing advanced automation systems to streamline production processes and integrating precision farming technologies into implement design. There is a need for training in up skilling and marketing. As the translated Sanskrit sloka says, “Without agriculture, all living beings perish. Therefore, one should engage in agriculture diligently, leading to prosperity”. Hence it is now imperative to ensure more are involved in diligent agriculture for which more revenue is to be generated through the same to ensure sustainability and continuity of the profession.
(The author is Vice-Chancellor, Cluster University of Jammu)
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