Agriculture Export Policy, 2018

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The Union Cabinet recently approved the agriculture export policy.
The Cabinet also approved the proposal for establishment of Monitoring Framework to oversee the implementation of Agriculture Export Policy.
India’s agricultural export is a paltry 15% of its total produce; which stands 25 % for US and 49 % for China.

Policy looks to provide impetus to agricultural exports, it is aimed at doubling the agricultural exports and integrating Indian farmers and agricultural products with the global value chains
It envisions making India global power in agriculture and raising farmers’ income through various policy instruments.

To double agricultural exports from 30 billion dollars to 60 Billion by 2022.
To diversify export basket, destinations and boost high value and value added agricultural exports including focus on perishables.
It looks to promote novel, indigenous, organic, ethnic, traditional and non-traditional Agri products exports.
To provide an institutional mechanism for pursuing market access, tackling barriers and deal with sanitary and phytosanitary issues.

Sanitary and Phytosanitary Measures

With the establishment of the World Trade Organization on 1 January 1995, an agreement on the Application of Sanitary and Phytosanitary Measures (the "SPS Agreement") entered into force.
It concerns the application of food safety and animal and plant health regulations.
Countries can set their own standards but they should be based on science and should be safe for the consumers.

To strive to double India’s share in world agri-exports by integrating with global value chain at the earliest.

Agriculture Export Policy has been organised in two categories – Strategic and Operational

Strategic: It Includes,
- Policy measures
- Infrastructure and logistics support
- Holistic approach to boost exports
- Greater involvement of State Governments in agri exports
Operational: It includes,
- Focus on Clusters
- Promoting value added exports
- Marketing and promotion of “Brand India”
- Attract private investments into production and processing
- Establishment of strong quality regimen
- Research & Development
- Miscellaneous

All the measures proposed in the Agriculture Export Policy are compatible with World Trade Organisation norms.
With India moving out of the income bracket of per capital gross national income of less than $1000, it is not allowed by the WTO to give any financial assistance or export SOPs.
Therefore measures such as marketing and promotion and infrastructure building such as development of clusters are only considered in the policy.

India’s agricultural trade policies are inconsistent with respect to guaranteed availability of produce for exports which makes India an unreliable trading partner; the policy would help India become a reliable partner.
It will help India in turning the unfavorable balance of payment as it will become an important source of foreign exchange.
It will act as a catalyst for crop diversification which helps in averting crop failure, better price realization etc.
It will also result in social upliftment by increasing farm income.

Prices in international market for food grain, sugar, cooking oil as well as dairy and meat products are very low leaving Indian products at disadvantage from their global peer.
Current minimum support price (MSP) of wheat and rice make India’s food grain quite dear in the domestic market.
Indian government is always "pro-consumer", backing cheap imports to keep inflation in food prices low, hurting local producer.
Farmers are not aware of the external factors like global price, quality standard etc which makes them a poor choice as reliable suppliers.
India’s farm produce suffers from poor customs and port infrastructure, and high logistics cost that cut into the exporters’ margins.

Effective cold chains can increase the exports of processed agricultural products, but government needs to put in money to push infrastructure.
Limited state interference, reform of the Agricultural Produce Market Committee (APMC) Act, liberalization of land leasing norms etc is required to make India a reliable supplier with continued stability.
Government should ensure easy credit flow to the export sector, especially small exporters to ensure adequate availability of funds to them.
Trade promotion organizations can be setup at strategic overseas location which can boost India’s paltry export to those nations.

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