Dr. P. K. Jena in Bhubaneswar, September 29, 2022: India since Independence, has achieved significant agricultural, industrial and socio-economic developments. But, considering the resources and opportunities available, the developments could have been much more to achieve the status of a developed nation.

The country is rich in various natural resources including minerals, soil, water, ocean, forest with enough skilled man power. As the soil, water and human resources are abundant, there is a great scope to further improve agricultural production and setting up various types of agro industries. These while providing employment opportunities to most of the people in rural sector, should stop the influx of rural poor to urban areas.

Though with some scientific and technological inputs our agricultural, animal husbandry and marine produces have been increased significantly, but the infrastructure, application of proper technology and skilled manpower for developing various agro industries, have not made any significant advancement compared to other developed countries. It is reported that, while about 14% of the total work force in developed countries are engaged in agro industrial sectors, in India, only about 3% of the work force find employment in this vital sector.

Most of the educated youths of India because of their limited knowledge about the scope of agro industries in their locality and the financial and management problems, do not venture to start any agro industries. Further, they are also completely unaware of the market situation, mechanism to sell their products in nearby areas and availing necessary assistance of government and other concerned agencies.

The small agro industries also face stiff competition for marketing their products particularly when big industries come into picture. Sometimes, the entrepreneurs desiring to set up agro industries have to pay more to avail the infrastructural facilities including land, proper equipment, suitable transportation system etc. in time.

They also face lots of problems for procuring raw materials and sending the finished products to the open market. Many times, the agro industries also face management problems due to absence of professional manager in their units and lack of cooperation of the partners due to vested interest. This may cause ultimately litigation among the partners and result in malfunctioning of the units.

In some cases the entrepreneurs divert the funds to some other areas like building houses etc affecting seriously the production due to financial constraint. Sometime the agro based industries do not employ the required number of skilled manpower and this affects the productivity as well as profitability.

Further, in some cases dissatisfaction due to want of proper work culture in the unit, results in idle man power causing high production cost. The use of back dated technology in many cases results in inferior products and high cost. The inferior products thus produced do not receive good market.

In addition to these, many times, particularly the small industries face problems like non availability of raw materials and also dispatch of finished goods to the market in time. Sometimes the production is affected considerably due to proper storing space. Some of the important problems of agro industries of India are summarized in Table – 1.

Table – 1

Areas of Problem Types of problems
Financial i)                 Cost Over Run

ii)             High Interest rate

iii)          Non availability of  finance in time

iv)           High cost of inputs/raw materials

Infrastructure i)                 Location Disadvantage

ii)             Costly Transport

iii)          Distance from warehouse

Marketing i)                 Lack of market for products

ii)             Stiff Competition

iii)          Market recent trends

iv)           Dependence on Govt. supply

Management i)                 Large investment in fixed assets

ii)             Diversion of funds

iii)          Dispute amongst  Partners

Production i)                 Out dated  machinery

ii)             Under utilization of capacity

iii)          Frequent Breakdown

iv)           Shortage in supply of raw materials

Human resource i)                 Lack of skilled Labour

ii)             Labour investment

Research & Development i)                 Non availability of research laboratory for quality control

ii)             Problem of consultancy services

Miscellaneous i)                 More government control

ii)             Natural calamity

iii)          Unfavorable govt. policy

Steps for Promoting Agro Industries

Some important steps to promote agro industries in India are summarized.

(1) It has been reported that, in many cases like rice, wheat, sugarcane, milk, the production in the country in recent years, has been quite satisfactory.

However, on account of poor post harvest management, the losses in agricultural produce in India is very high. It has been estimated that, the post production loses in food commodities is to the tune of 75 to 100 thousands crores of rupees per annum.

These losses are caused during storage, handling and transportation etc. It is suggested that, the extents of losses can be brought down to less than 50% of the existing level by adopting agro processing technology and proper transfer system and the rest 50% can be also saved by developing infrastructural facilities like proper grain storage structures, cold stores and processing systems.

(2) In order to facilitate the development of favourable atmosphere for agro industries, required financial assistance, supply of proper raw materials, infrastructure, appropriate technology, skilled manpower, prompt transportation and marketing of finish goods are essential.

(3) In village or panchayat level, the unemployed persons should be identified and suitably trained to be employed in agro industries which are to be set up in their area. This will also help in getting the cooperation of the concerned villagers.

(4) The government should take active part in developing a transparent mechanism to promote these industries keeping in view the related problems. T

he State Government should take into account the past experience regarding the failure of many agro industries in their area and take necessary measures to rectify those otherwise the entrepreneurs as well as the unemployed youths will not come forward with confidence to participate in this “Green Industrial Revolution”.

(5) For each specific agro based unit “Package Deal” by the government may go a long way in promoting these industries in a successful manner. The ‘Package Deal’ should comprise of necessary permission for land, infrastructural facilities, finance, water, electricity, provision for raw materials, appropriate technology for production of finish goods and their marketing. This would help considerably the small entrepreneurs to start the industries in a minimum period without much delay and get due benefits.

(6) Besides providing market facilities to these industries, both in India and abroad, the government should provide the most recent technology in the respective areas and extend quality control facilities. In order to improve the technology keeping in view the global trend, the government should motivate science and technology organizations in the country to take up research & development work in agro processing areas. This would help the industries to a great extent.

In this way by solving the above mentioned problems with full cooperation of the government and villagers, the agro industries can come up in large numbers in rural India. As a result of this, it will be possible to improve the socio economic conditions of rural people and stopping the inflow of unemployed rural mass to urban areas for getting jobs.

Former Director General, Council of Scientific & Industrial Research, India)

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