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The state of Karnataka in South India is often considered to be a melting pot of
cultures, languages and faiths. Though the world knows the state due to the IT
prowess of its capital Bengaluru, Karnataka, the eighth largest state in terms
of geographical size, boasts of immense diversity in its landscape and language.
This incredible variety is matched in equal measure by the rich biodiversity of
the state. Karnataka is uniquely poised with ten agro climatic zones, which are
ideally suited for majority of agricultural and horticultural crops, ably
supported by a 290 km-long coastline and inland water resources that encourage
fisheries.
The Phenomenal Rise of the Agriculture Sector
Elaborating on the inherent strengths of one of the most agriculturally diverse
states in India, Priya Bhattacharjee, Senior Assistant Director FICCI Karnataka
State Council, says, “It is estimated that about 83 percent of Karnataka’s
geographic area is suitable for agriculture. Consequently, Karnataka is the
largest producer of ragi, sunflower, tomato, coffee and arecanut; second largest
producer of maize, safflower, grapes, pomegranate and onion; and the third
largest producer of spices in the country. Further, the state has a wealth of
livestock population and marine resources that auger well for processing of
dairy, meat, fish and shrimp”.
The phenomenal development in the service sector has led to accelerated economic
growth of India in the past decade. Karnataka has been at the forefront of this
path-breaking technology revolution. The rapid strides made by the state in the
fields of IT and the adoption of modern practises have paved way for the growth
and development of the agricultural sector.
The presence of a strong and expanding infrastructure base definitely augers
well for the establishment of agri-based facilities in the state, believes Priya
Bhattacharjee. “Karnataka has an excellent road network of about 52,000 km,
railway network of about 3180 km, 2 major and 8 minor ports, and five domestic
airports and two international airports. The state also has an extremely strong
agri-infrastructure, including 146 main market yards, 352 sub market yards, 157
cold storages, warehousing capacity of close to 1.95 million tonnes and cold
store capacity of about 0.4 million tonnes. These infrastructure strengths are
further augmented by strong focus of policy makers to promote development of
supporting agri-infrastructure especially through initiatives such as crop
cluster development, food parks, agri-economic zones and agri-SEZs, among
other,” she asserts.
Sterling Contributions of the Government
One of the most important reasons for the sustained infrastructural and
industrial growth of the state has been the proactive role played by the
Government of Karnataka. Over the years, the state has been best known for its
comprehensive economic reforms and competitiveness in expanding the industrial
base and employment across sectors. The state has also had a lot of success in
conducting summits to augment Karnataka’s position as a destination of preferred
choice. Further, the initiation of well structured, transparent policies has
given rise to numerous employment opportunities in the state and has established
an enabling environment.
Reiterating the efforts made by the government, V. Venugopal, Managing Director,
Karnataka Udyog Mitra, the single contact point for all investors in the state,
maintains, “The New Industrial Policy offers more incentives to industries set
up in backward regions. Some of the incentives offered to the MSME sector
include investment promotion subsidy, exemption from stamp duty, concessional
registration charges, waiver of conversion fine, exemption from entry tax, etc.
It is because of these incentives that many mega projects are coming up in
backward regions. These industries are triggering the establishment of a large
number of downstream industries, thus accelerating the growth of industries in
backward regions”.
Bounteous Karnataka – A Sustainable Agribusiness Initiative
It has been hailed as a milestone in developing agribusiness in a holistic way.
But ‘Bounteous Karnataka’ is really about harnessing the immense agricultural
potential of the state in an attempt to catalyze growth and yield positive
results. It is among the many initiatives pursued by the state government to
promote inclusive development of one the most resource-rich states in India. The
will of the government can be gauged from the fact that, for the first time in
the history of India, the current government has presented a separate agri-budget
in developing sustainable agri and allied sectors.
The singular purpose of creating an Integrated Agribusiness Development Policy
2011 is to provide an enabling framework for the robust, sustainable and
inclusive growth and development of agriculture and allied sectors, leading to
strong partnerships between farmers, traders and the corporate sector. What
makes the policy unique is its sectoral coverage. The policy envisages the
development of every aspect of the state’s agriculture sector – horticulture,
fisheries, animal husbandry, sericulture and food processing. It is essentially
an end to end concept that emphasises both infrastructure and industrial
segments. Karnataka State Agricultural Produce Processing & Export Corporation
Ltd. (KAPPEC), under the able stewardship of Shri. Umesh Katti, Minister of
Agriculture, has been mandated to provide leadership to this agribusiness
initiative.
Since the concept aims at inclusive growth, it will ensure sustainable growth of
farmers, growers, fishermen, traders, exporters and industrial units. The
government aims to achieve this development through extensive backward and
forward linkages with enabling environment and through the creation of state of
the art infrastructure. In order to fulfil the objectives of the Integrated
Agribusiness Development Policy 2011, the state government has embarked on the
development of a 25-km long agri-horti-animal husbandry-fisheries-food
processing corridor. This corridor will be the most important link to agro
production centres, farming clusters, rural agro hubs as well as existing and
proposed industrial areas. The corridor will comprise several important nodes
like the Agribusiness Investment Region (ABIRs), Agribusiness Investment Areas (ABIAs),
knowledge hubs and special agri-horti-rural tourism zones. All these nodes are
expected to have worldclass forward and backward linkages. These specialised,
development strategies are certain to provide competitive advantage for
agribusiness development in Karnataka.
Without doubt, it is a policy that will provide multiple benefits to marginal
land owners, farmers, SHGs, fishermen, rural workforce and other producers,
besides improving the competitiveness of SMEs. All this will lead to better unit
value realization. The policy also acts as a facilitator of large scale
investments in a controlled manner and will open up new, highly profitable
avenues of export markets for the state’s produce.
The successful development of agribusiness and food processing sectors requires
seamless integration of modern-cutting edge technologies, marketing
opportunities and investments from both India and abroad. The government has
taken initiatives to partner with countries with the necessary technical
know-how, advanced methods of processing technologies and potential export
markets, so as to promote sustainable growth and development. However, for the
successful realization of agri projects, strong linkages between farmers,
logistics, processing and the end market are absolutely essential. This requires
the creation of a common platform for all the major stakeholders in the business
– farmers, technology providers, input suppliers, processors, infrastructure
providers, exporters and market linkage providers.
Global Agri-Business and Food Processing Summit
In an effort to provide a single platform for the congregation of important
players and to create long-lasting, sustainable partnerships in the
agri-business and food processing industry, the state government organised the
first-ever Global Agri-Business and Food Processing Summit on 01 & 02 December
2011 at the Bangalore International Exhibition Centre (BIEC). The summit was
aimed at promoting the entire gamut of agricultural activities under the state’s
Bounteous Karnataka Sustainable Agriculture initiative. Conceived by Mahindra
Consulting Engineers, in partnership with knowledge partners and transaction
advisors, PricewaterhouseCoopers, the summit was powered by KAPPEC.
The tremendous interest generated by the summit can be ascertained by the fact
that there were over 1,000 participants, including potential investors from The
Netherlands, Israel and France, that jostled for space at the venue. On the
first day of the summit itself, the state bagged as many as 31 projects worth Rs
93,724 crores.
The primary objectives of the summit were finding ways to develop worldclass
agri-business infrastructural facilities, including pre- and post-harvest
infrastructure, efficient strategic market linkages and increased productivity,
all of which will generate better returns for the state’s farming community.
With the presence of modern technologies and specialised strategies, Karnataka
will be able to fulfil the growing demand in both domestic and international
markets, and, in the process, achieve the core objective of rural prosperity.
The Government of Karnataka believes that the development of agriculture and
allied sectors will act as a catalyst and boost the state’s GDP growth. Apart
from food security, farmers of the state will be able to earn higher incomes.
Karnataka is a state that is celebrated the world over for its distinct culture
and patriotic fervour. Very soon, it will be revered for being the undisputed
leader in agribusiness growth and development.
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