Kochi: Policymakers, industry leaders and academics from across the world will gather in Lucknow next month for an international conference to discuss challenges faced by agribusiness in emerging economies and suggest ways to harness the growing opportunities in the sector.
The three-day meet, beginning 10 August, has been organized by the Indian Institute of Management, Lucknow, (IIM-L) in association with the universities of Tennessee and South Carolina. The meet has been funded by the US department of agriculture and will have the German development co-operation, GTZ, as the lead sponsor, conference coordinator Sushil Kumar said.
The meeting takes place at a time when multinational food and agribusiness companies, and organized retail are looking to developing countries, especially India, where processing accounts for just 2%, despite large production of fruits and vegetables.
Agribusiness in most developing countries, including India, is undergoing radical transformation at policy and structural levels, Kumar said, and added that the transformation offers immense opportunities for both new players as well as existing ones.
Kumar said rules and regulations governing agriculture and food are coming in the way of harnessing the full potential of the sector. He cited the example of the Agriculture Produce Marketing Committee (APMC) Act, which, in many states does not allow the private sector to procure foodgrain directly from farmers. Since the Indian farming system is still largely unorganized, there are issues in developing an efficient supply chain management system too. There is also the need to develop appropriate institutional mechanisms for new and evolving concepts, such as organic farming, contract farming, rural retailing, biofuel, microfinance and agriculture risk management, Kumar said.
It is against this backdrop that it becomes imperative that experts and stakeholders come together on a common platform to discuss these issues and suggest feasible strategies for harnessing the opportunities. The agriculture management centre (AMC) of IIM-L, through the conference, proposes to provide this platform, Kumar said.
Besides experts from educational institutes from across the country involved in the field of management and agribusiness, experts from more than 15 universities from the US, Canada, the Netherlands and developing countries such as Pakistan, Indonesia, Sri Lanka, South Africa and Bangladesh are expected to attend. Representatives of banks, commodity exchanges, insurance companies, firms such as Wal-Mart Stores Inc., Reliance Industries, Corn Products International, Mosaicco Seeds, Godrej Agrovet Ltd and Rallis India Ltd are also expected.
The way the agribusiness and food sector is transforming across the globe requires an enabling social, political and financial environment so that the existing market players as well as budding entrepreneurs feel motivated, Kumar said.
An efficient supply chain management is critical for any industry, but it is more so in the case of agribusiness and food industry as it deals with products that are perishable commodities, Kumar said.
He said there is also an urgent need to balance the financial profits of the companies while assuring remunerative prices to the farmers. Kumar notes that most farmers in the country are small and marginal, with very small land holdings, and welfare states such as India, have put in place a number of institutions to avoid farmers being exploited by the big businesses.
The bargaining power of the farmers is low compared with that of large companies and hence, these firms need to follow certain norms, values and ethical business practices so as to share the value creation in the chain with the farmers, Kumar said, and added that assuring this balance will remain one of the major challenges for the agribusiness and food industry.
Agribusiness management education is not as developed in India as in many other developed countries. With the increasing number of companies entering this industry, demand for trained personnel is bound to go up.
Increasing the efficiency of the sector will create opportunities for many business all along the value chain, including post-harvest management, processing, packaging, food safety and certification, and finally retailing. All these will be up for deliberation at the conference, Kumar said.