The Hindu : `States urged to cut taxes on processed fruits'

Online edition of India's National Newspaper
Monday, Dec 02, 2002

Southern States

Southern States - Karnataka

`States urged to cut taxes on processed fruits'

By Our Special Correspondent

Bangalore Dec. 1. The Union Government has requested the States to bring down sales tax and rationalise other taxes and cesses on processed fruits and vegetables, the Union Minister of State for Food Processing, N.T. Shanmugam, said here today.

Explaining the Centre's investor-friendly policies to provide an "enabling environment" for the development of food processing industries, such as abolishing the excise duty on processed fruits and vegetables, he said attempts had also been made to simplify procedures and reduce paper work.

Mr. Shanmugam, who was inaugurating "Bangalore Food Tech 2002", said the agro and food-processing sector was important to the development of the country, as it provided a vital linkage between agriculture and industry. The State Agriculture Minister, V.S. Koujalgi, presided.

While the country had strengths, there were weaknesses such as high wastage levels, high seasonality, and high "perishability", inadequate capital flow, complex tax structure and multiplicity of food laws, and inadequate post-harvest infrastructure. India should position itself appropriately to take advantage of its strengths and address its weaknesses. If these were done, there would be all-round prosperity, Mr. Shanmugam said.

He expressed happiness at the high level of processing and capacity utilisation in the State, and asked the business and trade to take advantage of the environment in the State and the country by coming forward to make large investments in the sector. Investments would benefit themselves and the nation, he said.

Crop diversification

Mr. Shanmugam called for greater focus on a crop diversification programme for each agro-climatic region; preparation for specialised agriculture coordination between the Centre, the States, and financial institutions; complete transparency in data sharing; harmonisation of tariffs and taxes; bank financing; and technology polices for the growth of the food-processing sector.

The minister said Indian entrepreneurs should improve their competitiveness with regard to cost and quality rather than depend on the Government to protect them. That was important in the context of liberalisation of international trade following the WTO agreement, Mr. Shanmugam added.

Mr. Koujalgi stressed the need to ensure proper prices for agriculture produce through measures such as export. He said it was equally important to see that farmers' requirements, including water, were met.

The Minister for Large- and Medium-scale Industries, R.V. Deshpande, said the agriculture sector and the food-processing industry had to grow if the country's economy had to flourish.

He did not think that fixing the prices of agricultural commodities by itself was enough. Farmers would benefit only if there was value addition to their produce, he added.

Waste of produce

Referring to the wastage of large quantities of food and agricultural produce due to the absence of proper post-harvest management practices, the Minister for Agriculture Marketing, B.S. Patil Sasnur, said proper care was necessary at different stages to preserve the quality of a commodity. He stressed the need for the adoption of proper food technology in view of the change in lifestyles and the growth in demand for ready-to-eat food products. Value-added products would help farmers realise better rates, he noted.

In his keynote address, the Director, Central Food and Technological Research Institute (CFTRI), Mysore, V. Prakash wondered why, despite its advantages in the horticultural sector, the State was not the forerunner in the agro business and food-processing sector. Value-addition to raw material was critical, he added.

Dr. Prakash asked the Government and the industries to work in partnership, and noted that the State had not been able to use the facilities offered by institutions such as the CFTRI and the Defence Food Research Institute.

The Managing Director of the National Horticulture Board, J.P. Negi, in his introduction remarks, made out a case to exclude medicinal plants from the provisions of the Forest Act, and include them in the horticulture sector, so that they were propagated commercially.

He favoured the proposed amendment to the Agricultural Produce Marketing Committee Act to allow private investments in the horticulture sector to be considered by departments and ministries engaged in handling perishables such as horticultural, marine, and dairy products.

The Additional Chief Secretary to Government, B.S. Patil, spoke of the measures taken by the State to promote food technology, in view of its growing importance. The "Bangalore Food Tech 2002" is organised by Manasa Communications Pvt. Ltd. and the State Government.

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