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Opportunities in Agriculture and Agro-based industries in Bihar

Opportunities in Agriculture and Agro-based industries in Bihar. Dr.K.M.Singh Director, State Agricultural Management and Extension Training Institute, Bihar. Global Meet for a Resurgent Bihar, 19-21 February 2007, Hotel Maurya, Patna. Background.

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Opportunities in Agriculture and Agro-based industries in Bihar

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  1. Opportunities in Agriculture and Agro-based industries in Bihar Dr.K.M.Singh Director, State Agricultural Management and Extension Training Institute, Bihar Global Meet for a Resurgent Bihar, 19-21 February 2007, Hotel Maurya, Patna

  2. Background • Bihar is India’s third most populated state with a total population of 83 million. • It accounts for one-seventh of India’s population below the poverty line. • The state’s performance lags seriously behind national trends. • It has a strong political clout in the national affairs with 40 members in the lower house and a large presence in the council of ministers.

  3. N West Champaran Present day Bihar Nepal East Champaran Sitamarhi Gopalganj Madhubani Kishanganj Supaul Araria Siwan Muzaffarpur Darbhanga Uttar Pradesh Saharsa Saran Purnia Samastipur Vaishali Madhepura Katihar Bhojpur Khagaria Patna Buxar Begusarai Bhagalpur Nalanda Munger Jahanabad Sheikhpura Rohtas Lakhisarai West Bengal Bhabhua Nawada Banka Aurangabad Gaya Jamui Jharkhand

  4. Challenges • Nearly 40% of Bihar’s population lies below the poverty line, the highest in India. • Modest progress was made during the 1990s (1993-94 to 1999-00), reducing poverty by nearly 7 percentage points, but the rate of poverty reduction was well below the national average. • By current trends Bihar is projected to fall well behind on most of the MDG targets for 2015. • Bihar’s rank for HDI among the Indian states has remained unchanged at 15 since 1981 while its score has increased marginally from 0.237 in 1981 to 0.308 in 1991 to 0.267 in 2001.

  5. Characteristics of Poverty • Bihar has a low rate of urbanization and poverty is predominantly rural. • Rural poverty is associated with limited access to land and livestock, poor education and health care, as also low-paid occupations and social status. • The rural poor tend to depend on agricultural wages or casual non-farm jobs for income. • Social or caste characteristics are also strongly associated with a lack of opportunities.

  6. Key Ingredients

  7. Bihar’s Development • Challenges • Poverty • Improving growth performance • Social service delivery • Public administration and governance • Development Strategy • Improving economic growth through strengthening agriculture and investment climate • Strengthening social service delivery and public administration • Supporting Development Strategy • Fiscal reform strategy • The administrative reform agenda

  8. Structure of the Economy • Bihar is a predominantly agrarian economy with a small manufacturing base. • While the share of agriculture has declined, it is still very large. • The share of industry is very small and has remained nearly the same. • The share of services has increased from 41% to nearly 50% of GSDP, and remains roughly on track with the all India average. • Overall Bihar’s economy has experienced little structural change and is not well diversified.

  9. Priority Areas for Development • Agriculture • Education • Health • Physical Infrastructure • Improving Investment Climate • Improving Service Delivery

  10. Role of Agriculture • Agriculture is the bedrock of Bihar’s economy, employing 80% of the workforce and hence is key to reducing poverty. • Agriculture output is volatile. • Crop productivity has been below the Indian average for most cereals. • The causes for the large yield gap include: • low investment rates, • lack of water management with annual flooding of the Gangetic plain, • weak transport and marketing infrastructure. • Severe fragmentation of land holdings.

  11. Role of Agriculture Bihar is well endowed with: • Fertile land • Plenty of water • Varied agro-climatic conditions • Abundance of raw material for agro based industries Some success stories and opportunities to build in Bihar’s agriculture include: • Diversification from cereals to Aromatic crops (Mentha, Lemongrass etc.) • Makhana value addition by private entrepreneur • Export of organic Basmati rice • Export of Litchi & Snow peas • Honey production and marketing • Kishanganj tea

  12. Trends and New Initiatives in Agriculture • Recent trends in Bihar include: • Specialized & localized production • Market - led Production • Use of hybrid seeds • Uniform quality • Contract farming • Diversification based on market demand • Repeal of APMC Act opens new opportunities for: • Establishment of Market Yards by private sector. • Establishment of specialty and Terminal markets under P-P-P mode. • Value addition, and Contract farming and • Export of fresh and processed fruits and vegetables from the state.

  13. Agriculture: The Core Competence of Bihar We can take three crops (Kharif, Rabi & Summer ) a year !!!

  14. AGRICULTURAL PROFILE & LAND USE

  15. Agricultural Production Scenario in Bihar

  16. Potential Areas for Diversification in Bihar

  17. TRENDS Diversification towards: Horticultural Crops • Fruits • Vegetables • Medicinal & Aromatic Plants

  18. Maize • Present Production:1.5 million MT (10% of country production) • Targeted Production(2015):4.5 million MT • Maize is grown round the year • Productivity is above the national average • Producers’ price is comparable to export parity price making maize internationally competitive. Opportunities for investment: • Contract Farming • Ethanol, Corn oil, Feed, Starch industry • Export of Baby corn

  19. Present Production: 13.00 million MT Targeted Production(2015): 46.72 million MT Opportunities for investment: New green field Sugar mills Capacity expansion of existing mills Ethanol manufacturing Molasses based alcohol Cogeneration of power Bagasse based paper Sugarcane

  20. Litchi • Present Production:0.28 million MT( 71% of national production) • Targeted Production(2015):0.5 million MT • Litchi’s whole sale price in Bihar is less than that of competing states, giving comparative advantage for domestic and export market Opportunities for investment: • Contract Farming • Export of fresh fruits • Processing & export • Litchi Honey

  21. Makhana • An Aquatic organic crop rich in Protein-10% and • low in fat- 0.02% !!! • Present Production- 0.003 million MT • (85 % of national production) • Targeted Production (2015): 0.050 million MT. • Opportunities for investment: • Contract farming • Processing & Export

  22. Mango • Present Production: 1.4 million MT (13% of country production) • Targeted roduction(2015): 3.0 million MT • Varieties • Jardalu, Langra, Krishna bhog, Jarda, Dudhiya Maldah Opportunities for investment: • Contract Farming • Export of fresh fruits • Cool chain • Processing & export

  23. Banana • Present Production: 0.05 million MT • Targeted roduction(2015): 2.40 million MT • Opportunities for investment: • Contract Farming • Cool chain • Plant propagation &Tissue culture • Processing

  24. Vegetables • Present Production:8.60 million MT (9% of country production) • Pointed Guard, Lady Finger, Brinjal, Cauliflower cucurbits of Diara (1.1 million ha.) with annual production of 48000 MT. Production can be substantially increased with market support • Targeted Production(2015): 12.4 million MT Opportunities for investment: • Organic Farming • Contract Farming • Processing & export • Cool chain

  25. Honey • Present Production: 1300 MT • (13% of national production) • Targeted Production (2015):3900 MT • Opportunities for investment: • Processing • Contract Farming • Marketing • Export markets

  26. Fisheries • Present Production : 0.27 million lakh MT • Targeted Production (2015): 0.43 million MT • Opportunities for investment: • Feed manufacturing units • Cold chain • Marketing • Aqua tech and amusement parks

  27. Aromatic Rice • Present Production: 0.015 million MT • Targeted roduction(2015): 0.05 million MT • Opportunities for investment • Contract Farming • Modern rice mill • Export

  28. Dairy • Milk Production (Present) : 4.06 million MT • Targeted Production (2015): 8.46 million MT • COMPFED:A Success Story • COMPFED has established 5023 DCS with 2.54 lakh members (highest in Eastern India) • Opportunities for investment • Dairy equipment • Fodder block making units • Processing infrastructure (Milk powder, Packaging material) • Marketing infrastructure

  29. Medicinal Plants Suitable for Bihar • Gurmar (Gymnema sylvestris) • Sarpgandha (Rauvolfia serpentine) • Kalmegh (Andrographis paniculata) • Kalihari ( Gloriosa superba) • Brahmi (Centella asiatica) • Buch (Acorus calamus) • Pippli (Piper longum) • Shatawari (Asparagus racemosum) Aromatic Plants Suitable for Bihar • Lemon grass • Palma rosa • Java citronella • Jama Rosa, CN 5 • Mentha • Tulsi • Vetiver • Patchouli

  30. Some Aromatic crops being grown in Bihar* (Year 2006-07) * Author’s estimates based on field survey

  31. Areas for Private Investment in Agribusiness Sector

  32. (Contd.) Areas for Private Investment in Agribusiness Sector

  33. THANKS

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