A Confederation of Indian Industry (CII) report on “Wealth Creation in the Farm Sector of India” suggests that the second green revolution could be led by the private sector, including Foreign Direct Investment (FDI) in retail, with the government playing the role of the facilitator. The report was submitted to Union Agriculture Minister Sharad Pawar last week.

CII’s chairman of the National Council on Agriculture Rakesh Bharti Mittal said FDI in retail for farm products could work as a catalyst in supply chain management for which the investors should be given tax breaks. “Private investment will drive extension services in the farm sector, share best practices and increase production. The government should take policy initiatives to encourage organised retail for farm products.”

Mr. Mittal, whose company exports two tonnes a day of baby corn grown in Punjab to the United Kingdom, felt that States such as Haryana and Punjab could diversify to non-cereal, exportable crops, while rice plantation could be encouraged in States such as Orissa and Bihar. “In case of any shortage, the country could go in for import of foodgrains for food security,’’ he said.

Highlighting a 10-point agenda for policy intervention, the CII report sought tax breaks for FDI and private investment in agriculture and retail.

The report urged the government to take steps for consolidation of land and advocated the need to implement a Model Land Leasing Act for providing farmland to private investors on long-term lease without alienating the owner from the land. “At the same time, the government should facilitate corporate and contract farming with the stakeholders concerned.”

The report, underscoring the need for “massive infusion of technology, infrastructure and market linkages,” sought the government intervention for strengthening farm inputs linking agriculture to markets, creating a supply chain management and providing fiscal incentives to the private sector.

It called for revamping the Minimum Support Price policy to make it more market oriented. It favoured supply of subsidised foodgrains to the Below Poverty Line population through food vouchers rather than the Public Distribution System.

Seeking a unified goods service tax for the fruit and vegetable processing industry, the report said creation of post-harvest infrastructure was necessary to minimise wastage of perishable food items. For this, the government could create a model that would support primary processing centres. There should be 150 per cent weighted deduction for extension services, training etc., and tax breaks for environment conservation such as water harvesting and wasteland development “where the private sector is normally not expected to invest their own.”

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