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Agriculture Newsletter - 06 May to 09 May, 2013

India Infoline News Service/ Mumbai 18:13 , May 09, 2013

To augment the number of covered godowns with Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) and also the State Warehousing Corporations (SWCs), the Government is implementing the Private Entrepreneurs Guarantee (PEG) Scheme. Under the scheme the private entrepreneurs can also construct godowns.

Top Stories 

RBI widens scope of priority sector lending, enhances MSME credit limit

The Reserve Bank of India on Friday announced three changes to the priority sector lending norms and more than doubled the limit for MSME advances to the services sector to Rs. 50mn.

The limit of loans to farmers against pledge / hypothecation of agricultural produce (including warehouse receipts) for a period not exceeding 12 months stands increased from Rs. 25 lakh to Rs. 50 lakh both under direct and indirect agriculture, the RBI said in its Monetary Policy Statement for the year 2013-14.

The limit of loans to dealers / sellers of fertilizers, pesticides, seeds, cattle feed, poultry feed, agricultural implements and other inputs has been raised to Rs. 5 crore per borrower from Rs. 1 crore, the statement added.

The limit of bank loans to Micro and Small Service Enterprises (MSEs) engaged in providing or rendering of services has been increased from Rs. 2 crore to Rs. 5 crore per borrower / unit, the RBI said further.

Govt notifies cabinet decision on partial sugar decontrol

The Government has notified the Cabinet Committee on Economic Affairs (CCEA) decision to remove two key controls on the sugar sector, says media reports.

Earlier On April 4, CCEA had decided to decontrol the sugar sector by giving freedom to mills to sell sugar in the open market and removing their obligation to supply the sweetener at subsidised rates for ration shops.

The Cabinet Committee on Economic Affairs has given a much-needed boost to India’s Rs 80,000 crore sugar industry. Sugar prices will now be market-linked but state controls like distance between sugar mills, sugarcane area reservation and setting of cane prices (over and above the government’s fair & remunerative price will continue to remain.

CCEA accepted the recommendations made by the Rangarajan Committee on sugar reforms at its meet held on Thursday. The meeting was presided by Prime Minister Manmohan Singh.

The timing of the sugar decontrol is bold considering the coalition government lacks the requisite numbers in Parliament and is facing general elections next year.  Coalition partner DMK had in March withdrew support to the United Progressive Alliance.

In the past, sugar mills had to sell 10% of their total production -- below market prices -- to the government under the levy quota mechanism. This has been done away with.

The Cabinet has also done away with the release mechanism. Under the regulated release mechanism, the Centre had the power to fix the amount of sugar mill owners could release in the open market.

India turns second largest fruit cultivator

Food Agriculture Organisation (FAO) data shows that India produces 76424.2 thousand tonne of fruits; 156325.5 thousand tonne of vegetables and 388269.2 thousand tonne of foodgrains during 2011.

The other major producer countries during 2011 are:-
This information was given by Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha.

Infocus News

Add Rallis, target price Rs. 155/sh: IIFL Inst Eq

IIFL Institutional Equities, a part of the IIFL Group, has an add rating on Rallis with a 12-month target price of Rs. 155 per share. This is an upside of 13% from its current market price of Rs. 137.
 
It has upgrade its FY14 and FY15 EPS forecast by 7% and 3% to Rs. 8.3 and Rs. 10.5 respectively.

However, the brokerage cautions on rich valuations, competitive risks for key brands, and limited visibility into the growth ramp at Metahelix and Dahej.
 
Brokerage summary follows...
Rallis India reported better than expected 4Q FY13 results, albeit in a seasonally slow quarter benefiting from a low base. We upgrade FY14/15ii EPS by 7%/3% to Rs.8.3/10.5. Read more…

Domestic News

Govt takes steps to boost number of grain godowns

To augment the number of covered godowns with Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) and also the State Warehousing Corporations (SWCs), the Government is implementing the Private Entrepreneurs Guarantee (PEG) Scheme. Under the scheme the private entrepreneurs can also construct godowns.

Prof. K.V.Thomas, Minister of Consumer Affairs, Food and Public Distribution informed the Rajya Sabha  that the FCI guarantees to hire godowns constructed under this scheme for a period of ten years, thereby, ensuring a fair return on the investment made. He was replying to a written question in the House. He said that a capacity of about 197 lakh MTs as on 31.03.2013 has been approved for construction of godowns in 19 States.

Further, for ensuring long-term scientific storage, the Government has also approved construction of 20 lakh MTs of storage capacity in silos within the overall sanctioned capacity of the PEG Scheme through the PPP mode.

The Minister said that besides the PEG Scheme, the Government has finalised a Plan scheme especially for the North East, for creation of an additional storage capacity of 5.40 lakh MTs through the FCI, in the next 3 to 4 years. These capacities once created in the NE region, would take care of the storage requirements of about 3 to 4 months.

Laying emphasis on price support for pulses, oilseeds: Govt

The Government announces support price for over two dozen agricultural commodities and the procurement of wheat and paddy through FCI and State Agencies is more compared to other commodities. However, Government is giving more emphasis on the price support to the farmers of pulses and oilseeds crops compared to the wheat and paddy. This information was given by the Minister of Consumer Affairs, Food and Public Distribution, Prof. K.V. Thomas in a written reply in Rajya Sabha.

The Minister said that the Government’s commitment to encourage production of pulses and oilseeds is evident from the fact that while from 2008-09 to 2012-13, the MSP of paddy (Common) has increased from Rs. 850 per quintal (plus Rs. 50 per quintal additional incentive tax) to Rs. 1250 per quintal, paddy Grade ‘A’ from Rs. 880 per quintal (plus Rs. 50 per quintal additional incentive tax) to Rs. 1280 per quintal, the increase in MSP of coarse grains like Jowar in the same period has increased more i.e. from Rs. 840 per quintal to Rs.1500 per quintal for hybrid variety and from Rs. 860 per quintal to Rs. 1520 per quintal for Maldandi variety and for Ragi from Rs. 915 per quintal to Rs. 1500 per quintal. Read more… 

Agriculture exports rise to $33.54bn

India’s exports of agricultural and allied products have increased from 29.8 bn dollar in 2011-12 to 33.54 bn dollar in 2012-13.

Commodities prices are a function of production and demand and do not follow a linear path. Agricultural commodities too show this attribute and fluctuate over time and commodity. Currently, International prices of wheat, rice and maize are higher compared to last year while prices of commodities such as cotton, edible oils and sugar are lower.

This information was given by Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha.

Micro irrigation outlay hiked to Rs16.93bn in FY14

Government is implementing various crop development schemes like National Food Security Mission (NFSM), Rashtriya Krishi Vikas Yojana (RKVY), Initiative for Nutritional Security through Intensive Millet Promotion (INSIMP), National Horticulture Mission (NHM), Technology Mission on Integrated Scheme of Oilseeds, Pulses, Oil Palm and Maize (ISOPOM) etc. in the states for promoting various crops including pulses, oilseeds, coarse cereals, fruits and vegetables suited to different agro-ecologies to avoid over-exploitation of soil and water.

An amount of Rs. 5bn has been provided in the budget 2013-14 for crop diversification in original Green Revolution States of Punjab, Haryana and Western Uttar Pradesh to promote technological innovation and to encourage farmers to choose alternate crops for sustainability of agriculture. 

Krishi Vigyan Kendras (KVKs) of Indian Council of Agricultural Research (ICAR) conduct Front Line Demonstrations of various crops across the country to disseminate improved production technologies on farmers’ field for enhancing crop productivity and encouraging the farmers for adoption of crops. 

This information was given by Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha.

Centre allots Rs5bn for crop diversification in FY14

Annual budget outlay of National Mission on Micro Irrigation (NMMI) scheme has been enhanced by approximately 13% from Rs. 15bn for the financial year 2012-13 to Rs.16.93bn for the financial year 2013-14. Andhra Pradesh allotted higher sum of Rs 295.00 crore, Maharashtra Rs 250.00 crore and Gujarat gets Rs 200.00 crore under National Mission on Micro Irrigation.

Under NMMI scheme, farmers are educated on the use the micro irrigation system through demonstration, training and awareness programmes. 

This information was given by Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha. 

Govt may raise agricultural production on Dry Lands

Ministry of Agriculture (MoA) is implementing a sub-scheme “Rainfed Area Development Programme (RADP)” under Rashtriya Krishi Vikas Yojana (RKVY) to address specific concerns of rainfed/dryland farmers. Besides, all major development programmes of MoA, viz., National Food Security Mission (NFSM), National Horticulture Mission (NHM), National Mission on Micro Irrigation(NMMI) etc. give special focus to dryland/rainfed areas. Research Projects on dryland agriculture are also being implemented by Central Research Institute for Dryland Agriculture (CRIDA), Indian Council of Agriculture Research (ICAR) for enhancing agriculture production and productivity in these areas.

Ministry of Rural Development (MoRD) is implementing the Integrated Watershed Management Programme (IWMP) for development of rainfed and degraded areas of the country. MoRD had constituted the Parthasarathy Committee and based on the suggestions of the Committee, National Rainfed Area Authority, in coordination with the Planning Commission, formulated Common Guidelines for Watershed Development Projects, 2008 to give and impetus to watershed development programmes.

MoRD has implemented main recommendations of the Technical Committee by integrating the three area development programmes namely Desert Development Programme (DDP), Drought Prone Areas Programme (DPAP) and Integrated Wasteland Development Programme (IWDP – into a single modified programme called Integrated Watershed Management Programme (IWMP) with effect from 26.02.2009. The WMP is implemented under the Common Guidelines for Watershed Development Projects, 2008.

This information was given by Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha.



 



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