The way to horticulture cluster development

THE Ashapura Farms & Nursery is an entity in the Kutch region of Gujarat that has successfully pioneered the production and marketing of Kesar mangoes over 200 acres. Other than catering to the domestic market, the entity also exports these mangoes to the UK, Singapore, Oman and the UAE.

At the heart of this success story is its commitment to nurturing quality root stock from mango seedlings in its nursery. In addition, organic farm practices have been followed for a balanced pest and nutrient management. Post-production, the mangoes are graded at the entity’s pack house where they are also pre-cooled to meet export quality requirements.

The state government, along with the National Horticulture Board (NHB) and the Agricultural and Processed Food Products Export Development Authority (APEDA), have been partners in supporting this endeavour.

Promoting and incentivising entities such as the above has been at the heart of the first ever Agricultural Export Policy announced by the Government of India. The aim is to double agricultural exports to $60 billion by 2022. One key strategy to achieving this target is the seeking of greater involvement of state governments by focusing on developing clusters having the potential for export-oriented production. Within these clusters, in addition, a greater thrust is to be given to value addition, promotion and branding of agri-produce.

The Doubling Farmers Income Committee (DFI) Report 2017 highlights that today we face challenges such as stringent global sanitary standards. It further adds that due to small landholdings, the produce from even a single village has significant variations in terms of varieties cultivated, size, other physical parameters and stage of maturity at the time of harvest.

As a result, it is difficult for exporters to source the requisite volume of a particular fruit or vegetable. Besides, lack of seamless initial aggregation at the farm gate, at times, limits the output to be pooled into exportable loads.

The 2020-21 output of horticulture production, at 331 million tonnes, has outpaced the production of foodgrains in the country. More specifically, with a production of 103 and 197.2 million tonnes, fruits and vegetables account for 31.1 per cent and 59.56 per cent of the domestic production. Their share is 11.38 per cent and 11.78 per cent of the world production, respectively.

While we are the second largest producer of fruits and vegetables in the world (largest producer of mango, banana, guava, papaya, lemon, lime and okra), our global share of horticulture exports stands at 1.7 per cent and 0.5 per cent for vegetables and fruits, respectively.

In the above backdrop, a key concern, pointed out by experts, is the small and marginal farmers’inability individually to invest in primary processing infrastructure at the farm gate. This includes post-harvest activities through ‘pack houses’, such as drying, grading, sorting, ripening, waxing, packaging and quality control assessment. They also include crop-specific cold chain storage/warehousing with pre-cooling facilities, reefer vehicles and distribution hubs.

Small and marginal farmers are also sometimes unaware of the crop quality specifications required by different types of buyers and intelligent information about near-farm or export markets. Besides, the weak market orientation of the small and marginal farmers stems from middlemen who bridge the gap between farmers and the market, earning margins at every stage of the distribution chain.

They, therefore, contend that there is a need to create clusters that strengthen the horticulture supply as well as value chain between the Origin (farm source) and Destination (domestic or/and export market) — ‘OD pairs’. Such clusters will factor in seasonality as well as crop specificities for fruits and vegetables such as mango, banana, papaya, lemon, okra, onion, tomato, cabbage, cauliflower and brinjal that are abundantly grown for the domestic market and for mango, banana, grapes and pomegranate etc that are exported. The focus will also be on logistics by road, rail and air connectivity.

For enabling such a cluster approach to achieve uniform crop quality and variety, collectives such as farmer producer organisations (FPOs) have been advocated. Therefore, a dedicated central sector scheme for the formation and promotion of 10,000 FPOs across the country was launched last year. This provides handholding and support to the FPOs through equity grants and credit guarantee up to five years.

More significantly, the National Horticulture Board has launched a pilot of the Horticulture Cluster Development Programme (CDP) to leverage geographic specialisations and promote integrated market-led development. This includes pre-production, post-harvest, logistics, branding and marketing activities pertaining to both primary and processed agri-commodities. It also aims to address the gaps in information-sharing on myriad sanitary issues for export markets.

The key institutional innovation herein is that a public sector cluster development authority (CDA) will join hands with an implementing agency that will raise a part of the eligible project cost as term loan and promoters’ contribution. The FPOs and cooperatives, among others, could be the implementing agencies. As many as 53 horticulture clusters have been identified across the country, of which the 12 selected for the pilot include crops of apple, mango, banana, grapes, pineapple, pomegranate and turmeric. This approach is expected to benefit approximately 10 lakh farmers.

Thus, the effort of the programme is to identify niche markets, such as of the Kesar mango of the Kutch, and develop an ecosystem around the horticultural crop.

A key last-mile building block for this ecosystem is also the need to further push digitisation of land records and geographic indicator registration in districts as units of administration.

The Indian Council of Agricultural Research leads more than 700 Krishi Vigyan Kendras in districts. These need to be aggressively plugged into the CDP and FPO supply as well as value chains to advise on increasing productivity, yield and capacity-building to expand both the domestic and global market reach of horticulture crops.

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