Agriculture January 2016

AGRICULTURE
DECEMBER
JANUARY
2016
2015
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AGRICULTURE
Executive Summary..3
Advantage India.... 4
Market Overview and Trends...6
Growth Drivers.....18
Opportunities....34
Success Stories ......41
Useful Information.......... 44
DECEMBER
JANUARY
2016
2015
AGRICULTURE
EXECUTIVE SUMMARY
2nd largest
At 157.35 million hectares, India holds the second largest agricultural land in the world
agricultural land
Favourable climatic
With 20 agri-climatic regions, all 15 major climates in the world exist in India. The country
also possesses 46 of the 60 soil types in the world
Total food grains production in India reached an all-time high of 252.68 million tonnes
in FY15*. As on August 17, 2015, Rice and wheat production in the country stood at
104.84 and 88.94 million tonnes, respectively
India is the largest producer of spices, pulses, milk, tea, cashew and jute; and the second
largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton and oilseeds
India is one of the largest manufacturers of various farm equipments like tractors,
harvesters and tillers. India manufactures one-third of tractors in the world; the number of
tractors in the country is estimated to reach 16 million by 2030 from 6 million in 2014
conditions
Record production of
food grains
Largest producer of
major agricultural and
horticulture crops
Increasing farm
mechanisation
Source: Ministry of Agriculture , Government of India, TechSci Research

Note: * - 4th Advance Estimates,
DECEMBER
JANUARY
2016
2015
AGRICULTURE
ADVANTAGE INDIA
DECEMBER
JANUARY
2016
2015
AGRICULTURE
ADVANTAGE INDIA
Robust demand
Growing demand
2014-15
Food grain
production:
251.12
million
tonnes
Attractive opportunities
A large population is the key driver

of demand for agricultural
products
Rising urban and rural incomes

have also aided demand growth
External demand has also been

growing especially from key
markets like the Middle East
Competitive advantages
High proportion of agricultural land

(157 million hectares)
Leading producer of spices, jute,

pulses; second-largest producer of
wheat, paddy, fruits and
vegetables
Increasing demand for agricultural

inputs such as hybrid seeds and
fertilisers
Promising opportunities in storage

facilities; potential storage capacity
expansion of 35 million tonnes
under the 12th Five Year Plan
Advantage
India
DECEMBER
JANUARY
2016
2015
2020-21
Food grain
production:
280.6
million
tonnes
Policy support
Schemes like Paramparagat Krishi

Vikas Yojana (PKVY) helps in
developing organic clusters and
make available chemical free inputs
to farmers.
Other steps include Pradhanmantri
Gram Sinchai Yojana that ensures
improved access to irrigation;
creation of an unified national
agricultural market which would help
boost the incomes of farmers
100 per cent FDI under automatic
route for development of seeds
Source: Ministry of Agriculture,
World Bank, FAOSTAT, TechSci Research
AGRICULTURE
MARKET OVERVIEW AND TRENDS

DECEMBER
JANUARY
2016
2015
AGRICULTURE
EVOLUTION OF AGRICULTURE IN INDIA
2000 onwards
1980-2000
1960-80
1950s
Pioneering work of
agricultural scientists
and efforts of farmers
led to Green Revolution
High Yield Variety
Stagnation in
(HYV) of seeds,
agriculture
increased use of
Low growth in crop
fertilizers and irrigation
and grain production
resulted in a significant
(0.4 and 0.1 per cent
spike in production
p.a.)
Attained food security
Food grain production
and reduced import of
of 59.2 MT in 1952
food grains
53, with a yield of
579.8 kg/ha
DECEMBER
JANUARY
2016
2015
Expanding cereal
production
Economic reforms
introduced; greater
encouragement to
exports
Surplus of production of
agricultural commodities
over domestic demand
India emerges as a net
exporter of agricultural
products
Increase in population
and strong income growth
50% increase in seed subsidy

Additional financial assistance for
horticulture crops
Schemes like Pradhan Mantri Krishi
Sinchai Yojana that accords high priority
to water security
Creation of Price Stabilization Fund
(PSF) by the Department of Agriculture
and Cooperation as a price control
measure to dampen the impact on
consumers
Allocation of USD830 million for the
development of micro irrigation,
watershed and Pradhan Mantri Krishi
Sinchai Yojana
The Indian agricultural services and
agricultural machinery have
cumulatively attracted USD2,211.17
million from April 2000 to September
2015
Source: Ministry of External Affairs, RBI, Ministry of Agriculture, TechSci Research

Notes: MT - Metric Tonnes, P. A. - Per Annum
AGRICULTURE
SCHEMES INITIATED BY THE GOVERNMENT
Agricultural Technology Management
Agency(ATMA)
This technique facilitates retrieval of data and data

entry from the internet based web portals without
actually having internet by using a simple mobile
phone.
More than a dozen of services of innovative

technology like USSD are being operationalized
for farmers and other stakeholders.
Small Farmers Agribusiness Consortium

(SFAC)
Focused on creating wider linkages for FPOs to

reduce transaction costs, improve access to
technology and services and ultimately link them
to better market opportunities for higher returns.
An ICT backed platform has been provided that

would electronically network all the FPOs in the
country and leverage their collective bargaining
power.
Pradhan Mantri Krishi Sinchai Yojana
Allocation of USD830 million for the development

of micro irrigation, watershed and Pradhan Mantri
Krishi Sinchai Yojana
State government are compelled to fund the

agriculture sector, take appropriate measures to
achieve the targeted growth rate and address
issues of farmers
Paramparagat Krishi Vikas Yojana

(PKVY)
This scheme ensures the promotion of organic

farming
Adoption of farming will promote the balanced use

of chemical fertilizers and enhance the quality of
farm produce
Source: Deptt. of Agriculture and Cooperation, Ministry of Agriculture, FAOSTAT, TechSci Research
DECEMBER
JANUARY
2016
2015
AGRICULTURE
GROWTH IN AGRICULTURE (1/2)
GDP by value added size of agriculture and allied
activities (USD billion)
GDP of agriculture and allied sectors in India was

recorded at USD259.23 billion in FY15
According to the advanced estimates of Central Statistical
Organisation, agriculture and allied sector recorded a
growth of 8.3 per cent in FY15
Agriculture is the primary source of livelihood for about 58

per cent of Indias population
259.23
162.67
141.77 139.39
137.17
FY07
FY08
FY09
FY10
157.35 160.80
140.77 132.71
FY11
FY12
FY13
FY14
FY15
Source: Ministry of Agriculture, Print Release, RBI, TechSci Research

Notes: GDP Gross Domestic Product,
CSO Central Statistical Organisation
DECEMBER
JANUARY
2016
2015
AGRICULTURE
GROWTH IN AGRICULTURE (2/2)
Gross Capital Formation in agriculture and allied
activities (USD billion)
As per Union Budget 2015 -16, there is a need to create a
National Agriculture Market for the benefit of farmers, which
will also have the incidental benefit of moderating price
rises. Government to work with the States, in NITI, for the
creation of a Unified National Agriculture Market.
CAGR: 8.6%
26.30
Under the Union Budget 2015 16, allocation of USD879

million for Pradhanmantri Gram Sinchai Yojana which
envisages to support micro irrigation, ensures watershed
development. This scheme is to provide enhanced water
efficiency through Per Drop More Crop
A special scheme has been launched in North Eastern

Region with allocation of USD20.73 million for the
promotion of organic farming and export of organic produce
36.41
33.50
27.60
28.10
29.10
FY09
FY10
FY11
29.80
20.40
FY07
FY08
FY12
FY13
FY14
Source: Ministry of Agriculture, TechSci Research

Note: RKVY is a central government scheme providing funds to state
governments to spend on agriculture
DECEMBER
JANUARY
2016
2015
10
AGRICULTURE
MAJOR SEASONS: KHARIF AND RABI (1/2)
Production of food grains (million tonnes)
in Kharif and Rabi seasons
There are two major agricultural seasons in India: Kharif

and Rabi
Kharif season lasts from April to September (summer); rice
300
(paddy) is the seasons main crop
CAGR: 1.30%
126.38
126.31
128
129
124
132
128
131
124
114
116
121
According to the
advance estimates for FY15 by
Ministry of Agriculture, the total food grains production is
estimated to be around 252.68 million tonnes
104
50
4th
118
Total food grains production in India reached an all-time

100
high of 257 million tonnes in FY14
121
150
110
250
Rabi season lasts from October to March (winter); wheat is

200
the seasons main crop
FY08
FY09
FY10
FY11
FY12
FY13
FY14
FY15*
0
Kharif
Rabi
Source: Finance Ministry, Ministry of Agriculture,

TechSci Research
Note: * 4th Advance Estimates
DECEMBER
JANUARY
2016
2015
11
AGRICULTURE
MAJOR SEASONS: KHARIF AND RABI (2/2)
Rabi
Area Sown in FY16* (lakh hectares)

Kharif
0.02
1.2
117.09
Wheat
27.04
20.65
7.8
378.24
48.84
Pulses
Pulses
Coarse Cereals
Oil Seeds
Cereals
Rice
Oilseeds
185.15
Sugarcane
Rice
Cotton
Jute & Mesta
186.07
9.43
115.62
Source: Ministry of Finance, Ministry of Agriculture, TechSci Research

* - Data is till October 2015
DECEMBER
JANUARY
2016
2015
12
AGRICULTURE
PRODUCTION OF RICE AND WHEAT ON THE RISE
Production and yields of wheat and rice
During the last five years, production as well as yields of

both major crops - rice and wheat - increased significantly
The yield of rice reached 2.39 tonnes/hectare in FY15*
3.5
100
3
2.5
80
60
1.5
86.9
96
94.9
105.3
93.51
105.2
95.85
106.29
88.94
104.8
20
80.8
89.1
40
80.7
99.2
In 2014 15, production of wheat according to the fourth

advance estimates is 88.94 million tonnes, and that of rice is
104.84 million tonnes
120
78.6
96.7
Production of wheat and rice reached an all-time high in

2013-14. However, according to the third advance estimates
for 2014 -15, the production of rice and wheat is estimated
to be lower by 4.11 million tonnes and 5.07 million tonnes
respectively than previous years production
FY08
FY09
FY10
FY11
FY12
FY13
FY14
FY15*
1
0.5
0
Production of Wheat (million tonnes)

Production of Rice (million tonnes)
Yield of Wheat (tonnes/hectare)
Yield of Rice (tonnes/hectare)

Note: * 4th Advance Estimates
DECEMBER
JANUARY
2016
2015
13
AGRICULTURE
FRUIT AND VEGETABLE PRODUCTION CONTINUES TO INCREASE
India ranks 2nd in global production of fruits and vegetables, and is the largest producer of mango and banana, and has the
highest productivity of grapes in the world
National Horticulture Mission, National Horticulture Board, Technology Mission for Integrated Development of Horticulture in
North-East are some of the initiatives taken by the Government of India to boost the horticulture sector in the country
The National Horticulture Board has launched a new capital investment subsidy scheme for construction and expansion of
cold storages and storages of horticulture products
Indias horticulture production rose at a CAGR of 6 per cent during FY05-15
280.5
277.3
268.8
50.0
257.3
0.0
5.0
China
India*
0.0
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
Production (million tonnes)
DECEMBER
JANUARY
2016
2015
Area (million hectares)
Fruits (million tonnes)
27818918
14974561
35947720
26548859
163388000
10.0
240.5
100.0
223.1
15.0
214.7
150.0
211.2
20.0
191.8
200.0
182.8
25.0
166.9
250.0
91293000
30.0
CAGR **: 6%
137066750
300.0
573935000
Fruit and vegetable production of top four countries (2013)
Indian horticulture area and production
United States of
Turkey
America
Vegetables(million tonnes)
Source: National Horticulture Board, Assorted Articles, FAO Stat, TechSci Research
Note: ** - CAGR Mentioned is for Production,
* Figure as of 2015
14
AGRICULTURE
SURGE IN DEMAND OF INDIAN AGRICULTURAL PRODUCTS (1/2)
Agricultural exports from India (USD billion)
India is among the 15 leading exporters of agricultural

products in the world
Total agricultural exports from India grew at a CAGR of 27.9
per cent over FY10-15 to reach USD38.70 billion in FY15
38.70
CAGR: 27.9%
The contribution of agriculture to total export has increased

from 13.08 per cent in 2008 09 to 14.17 per cent in 2013
14
Agricultural exports has increased from USD24.7 billion in
201112 to USD38.70 billion in 2014-15 projecting a growth
of 16.14%
In FY16 (April-September 2015), agricultural exports from
India reached USD8.06 billion
29.20
29.60
24.70
15.60
11.30
8.06
FY10
FY11
FY12
FY13
FY14
FY15
FY16*
Source: Ministry of Commerce, World Trade Organisation,

Indian Budget 2016, TechSci Research
Notes: CAGR - Compound Annual Growth Rate
*-Data is for April-September 2015
DECEMBER
JANUARY
2016
2015
15
AGRICULTURE
SURGE IN DEMAND OF INDIAN AGRICULTURAL PRODUCTS (2/2)
India exported rice worth USD3.17 billion in 2015-16*, accounting for nearly 39.33 per cent of total agricultural exports
Livestock Products and Fruits & Vegetables are the next largest export items in terms of value; they accounted for 26.8 per
cent and 6.8 per cent, respectively, of total agricultural exports in 2015-16*
Guargum meal emerged as major export commodity; the value of exports rose at a staggering CAGR of 45.3 per cent over
FY10 -15
Agricultural exports are expected to rise up to USD45 billion in FY15
4000
3.17
3500
2500
1550
1970
3000
2000
500
FY11
FY12
665
Cashew
Sugar
Oil Meals
Fruits and Vegetables
DECEMBER
JANUARY
2016
2015
Livestock Products
Guargum Meal
1000
602
1500
405
0.33
FY14
FY15
39
0.55
707
0.43
615
403
0.28
239
218
0.29
291
163
2.17
Rice
3.5
3
2.5
2
1.5
1
0.5
0
Exports of guargum meal (USD Million)

3489
Key agricultural and allied sector exports

from India in 2015-16* (USD billion)
0
FY10
Value (USD Million)
FY13
FY16*
Quantity (billion tonnes)
Source: Ministry of Agriculture, APEDA, TechSci Research

*-Data is for April-September 2015
16
AGRICULTURE
KEY AGRICULTURAL STATES AND THEIR CONTRIBUTIONS
Punjab and Haryana were the key
states of green revolution. Punjab
is one of the largest producers of
food grains
Uttar Pradesh largest

producer of wheat
(30.00 million tonnes)
Assam - largest producer
of tea
Gujarat largest
producer of cotton
(*12.5 million bales)
Maharashtra largest
producer of Jowar,
Tobacco and Safflower
Karnataka largest
producer of Sunflower
seed, Maize, Ragi, Coffee
and Cardamom
West Bengal largest

producer of rice
(15.80 million tonnes)
Madhya Pradesh largest

producer of soybean,
pulses, Linseed
Source: Department of Agriculture & Cooperation,

Notes: All figures as of 2015,
* Projected for 2014 - 15
DECEMBER
JANUARY
2016
2015
17
AGRICULTURE
GROWTH DRIVERS
DECEMBER
JANUARY
2016
2015
AGRICULTURE
GROWTH DRIVERS OF INDIAN AGRICULTURE
Population and income

growth
Demand-side
drivers
Increasing exports
Favourable
demographics
Growing institutional
credit
Growth
drivers
Hybrid and genetically
Increasing MSP
Introduction of new
schemes like
modified seeds
Paramparagat Krishi
Mechanisation
Irrigational facilities
Green Revolution in
Sinchai Yojana, Sansad
Eastern India
Adarsh Gram Yojana
Supply-side
drivers
Vikas Yojana,
Policy
support
Pradhanmantri Gram
Opening up of exports
of wheat and rice

Note: MSP - Minimum Support Price
DECEMBER
JANUARY
2016
2015
19
AGRICULTURE
A LARGE POPULATION ENSURES HIGH DEMAND FOR AGRICULTURAL PRODUCTS
1227.19
1243.34
1259.7
1282.39
1293.06
1048
FY11
FY12
FY13
FY14
FY15
FY16
696
Population is a key demand driver of agricultural growth in

the country
864.25
Indias population reached 1.28 billion in FY15 compared to

1.26 billion in FY14
1210.98
Population of India (million)
India, the second-most populated country in the world, has

to meet food consumption needs of around 1,276 million
people
Indias consumption expenditure is likely to reach USD3.6

trillion by 2020, up from an estimated USD0.2 trillion in 2015
Indias population is expected to reach 1.3 billion by FY16
FY81
FY91
FY01
Source: Census of India 2011, World Population Statistics,

TechSci Research
DECEMBER
JANUARY
2016
2015
20
AGRICULTURE
INCOME GROWTH ALSO DRIVING AGRICULTURE DEMAND
Per capita income at factor cost (USD)
Domestic demand for agricultural and allied products has

not only been rising due to rising population, but also as a
result of greater consumption by a wealthier population
CAGR: 0.26%
Over FY07-14, Indias per capita income increased at a

CAGR of 0.26 per cent to USD662
849
746
793.6
811.6
715.4
714.9
650
662.0
Consumption expenditure in India is likely to reach USD3.6

trillion by 2020, up from an estimated USD0.2 trillion in 2015
Indian agriculture has also benefitted from rising external
demand and the sectors wider participation in the global
economy
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
Source: Central Statistical Organisation, TechSci Research
DECEMBER
JANUARY
2016
2015
21
AGRICULTURE
GROWING AREA UNDER IRRIGATION (1/2)
Indias irrigation potential has steadily increased over the
years. In FY13 it stood at 139.5 million hectares compared
to 90 million hectares in 1995 and 22.6 million hectares in
1951
59.23
60.84
62.74
63.19
63.64
61.94
63.66
65.69
66.1
84.28
86.75
88.06
88.9
85.08
88.89
91.73
92.58
The two major lift irrigation projects in Kohlapur; Tembhu

and Takari Mhaisal-have received USD19 million and
USD15 million by the Union Government
81.08
The Government of India has launched a new scheme,

Pradhan Mantri Krishi Sinchai Yojana, that provides end
to end solutions in irrigation supply chain and focuses on
creating sources of assured irrigation, per drop more crop,
and harnessing rain water at micro - level through Jal
Sanchay and Jal - Sinchan
Area under irrigation (million hectares)
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
Gross Irrigated Area
Net Irrigated Area

Note: P is Provisional estimate
DECEMBER
JANUARY
2016
2015
22
AGRICULTURE
GROWING AREA UNDER IRRIGATION (2/2)
Gross irrigated area under food grains
(000 hectares)
Gross irrigated area under food grains is estimated to have

grown to 61.632 million hectares in FY13
Of the wide variety of crops in India, rice and wheat are the
most irrigated
61065
60415
61612 61632
59512
With growing investments in irrigation, the dependence on

monsoons has declined considerably over the years
58550
58122
56489
54715
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
Source: Food and Agricultural Organization US,

Ministry of Agriculture, TechSci Research
DECEMBER
JANUARY
2016
2015
23
AGRICULTURE
INCREASING MECHANISATION OF FARMING (1/2)
Number of tractors sold
Mechanisation helps in raising farm income by increasing

productivity and limiting post-harvest losses
FY13
626839
591498
FY12
697675
608577
393836
342836
300000
352835
Allocation of USD223 million has been made for the

establishment of Farm Machinery Banks and distribution of
farm machinery and tools to farmers in various states
544428
CAGR: 7%
The Government of India has released a new subsidy for

the establishment of 988 Farm Machinery Banks during
2014-15 under SubMission on Agricultural Mechanisation.
India is the largest manufacturer of tractors in the world,

accounting for about one-third of global production
The availability of farm power increased from 0.36 kilowatts
per hectare in 1971 to 1.4 kilowatt per hectare in 2006,
while the share of animated labour (that includes animal
and human labour) to farm power dropped from 60 per cent
to less than 14 per cent during this period
FY07
FY08
FY09
FY10
FY11
FY14
FY15
Source: Department of Agriculture and Cooperation,

State of Indian Agriculture 2013-14, ICRA,
A report on Farm Mechanization in India, TechSci Research
The Government of India focuses on increasing its reach of

farm mechanisation to the regions where availability of farm
power is low and to small and marginal farmers
DECEMBER
JANUARY
2016
2015
24
AGRICULTURE
INCREASING MECHANISATION OF FARMING (2/2)
Number of tillers sold
Sale of tillers increased at a CAGR of 8.6 per cent to 48,000

units over FY07-15
About 20 per cent of worlds tractor production is carried out
in India. Domestic tractor market contracted by 2.4 per cent
YoY during the first five months of FY15, while export
volumes grew by 16.9 per cent during the same period
In FY14, domestic sales of tractors recorded 350,000 units
annually while exports reached 60,000 units
CAGR: 8.6%
60000
56000
55000
48000
35294
24791
26135
FY07
FY08
38794
25000
The government has set up a number of Farm Machinery

Training and Testing Institutes to train farmers on the
operation and maintenance of agricultural equipment
DAC proposes to initiate National Mission on Agricultural
Mechanisation (NMAM) to spread the benefits of
mechanisation among all levels of farmers especially small
and marginal ones
DECEMBER
JANUARY
2016
2015
FY09
FY10
FY11
FY12
FY13
FY14
FY15
Source: Department of Agriculture and Cooperation,

A report on Indian Tractor Industry by ICRA, TechSci Research
DAC - Dept. of Agriculture and Cooperation
25
AGRICULTURE
GROWING YIELD AND USE OF QUALITY SEEDS (1/2)
3517
3001
14
12
10
1389.44
8
6
158
174
225
107
1357.58
85.81
51.4
1258.55
1791
97
1550
82
In FY15, production of certified seeds increased to 3.5

million tonnes from 1.27 million tonnes in FY07
1268
Usage of hybrid seeds has been more prevalent in cash

crops than food crops
4000
3500
3000
2500
2000
1500
1000
500
0
80
There has been strong growth in the use of hybrid seeds

due to their high yield and resistance
3473
Production of seeds (000 tonnes)
In FY15, production of foundation seeds reached 157,616

tonnes from 79,654 tonnes in FY07
0
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
Foundation seed production ('000 tonnes)
Certified seed production('000 tonnes)
Breeder seed production('000 tonnes)
DECEMBER
JANUARY
2016
2015
26
AGRICULTURE
GROWING YIELD AND USE OF QUALITY SEEDS (2/2)
Food grain yields (kg/hectare)
Usage of hybrid seeds has boosted the yield of food grains

to 2,070 kg/ hectare in FY15 from 1,756 kg/ hectare in FY07
The government has been playing a proactive role in
promoting greater use of hybrid seeds; it encourages private
seed companies by providing a subsidy of 25 per cent of the
capital cost subject to a maximum of USD50,000 per unit
1756
FY07
1860
1909
FY08
FY09
2078
2125
2101
2070
FY12
FY13
FY14
FY15
1930
1798
FY10
FY11
Source: A report by Fertilizer Association of India,

Ministry of Agriculture, RBI, TechSci Research
DECEMBER
JANUARY
2016
2015
27
AGRICULTURE
INSTITUTIONAL CREDIT TO AGRICULTURE ON A RISE (1/2)
Commercial Banks
FY09
Coorperative Bank
FY13
39.80
27.42
159.27
FY12
40.95
23.45
157.26
FY11
37.53
23.23
145.86
FY10
30.73
19.28
26.78
14.85
99.24
FY08
19.92
11.60
89.94
FY07
23.97
12.57
73.76
18.82
9.05
In FY15, institutional credit to the agricultural sector was

USD18.07 billion from Regional Rural Banks
120.54
Farmers are allowed to avail crop loans at an interest of 7

per cent
168.88
Institutional credit to agriculture (USD billion)
Institutional credit to the agriculture sector increased at a

CAGR of 12.8 per cent during FY0714
FY14
Regional Rural Bank
Source: Ministry of Agriculture, RBI,

National Sample Survey Organisation (NSSO), TechSci Research
DECEMBER
JANUARY
2016
2015
28
AGRICULTURE
RISING MSPs INCENTIVISE FARMING (1/2)
MSP of rice (USD per quintal)
The MSP is announced well ahead of the sowing season so

that the farmers can take informed decisions on cropping.
CAGR: 16.8%
The Indian government increases MSPs regularly to

incentivise farmers to enhance production of crops and
ensure there is adequate supply
44.50
The MSP for rice was raised from USD44 per quintal in
FY14 to USD45.80 per quintal in FY15 at YoY growth of 4.1
per cent
16.40
MSP for rice reached USD21.92 per quintal in FY16 (till

September 2015)
18.70
20.40
FY09
FY10
46.70
46.60
44.00
45.80
21.92
13.20
FY07
FY08
FY11
FY12
FY13
FY14
FY15 FY16*

Note: MSP is Minimum Support Price
*- Data is till September 2015
DECEMBER
JANUARY
2016
2015
29
AGRICULTURE
RISING MSPs INCENTIVISE FARMING (2/2)
MSP of Arhar (USD per quintal)
Government has increased the MSP of pulses significantly

in the past three years to encourage production and thereby
reduce the supply shortage
CAGR: 10.24%
MSP for Arhar increased from USD31.2 per quintal in FY07

to USD75.02 per quintal in FY16
78.90
70.90
71.30
72.20
FY13
FY14
FY15
75.02
65.80
48.50
38.50
43.30
31.20
FY07
FY08
FY09
FY10
FY11
FY12
FY16
DECEMBER
JANUARY
2016
2015
30
AGRICULTURE
FAVOURABLE POLICIES ARE SUPPORTING THE SECTOR GROWTH (1/2)
Paramparagat Krishi
Vikas Yojana
(PKVY)
This scheme ensures the promotion of organic farming. Rs 300 crore has been allocated
for the scheme during the year 2015-16.
Adoption of farming will promote the balanced use of chemical fertilizers and enhance the
quality of farm produce
Foreign Direct
Investment (FDI)
Pradhan Mantri Krishi

Sinchai Yojana
(PMKSY)
100 per cent Foreign Direct Investment (FDI) is allowed under automatic route in storage
and ware housing including cold storages
FDI policy for agriculture was amended to allow 100 per cent FDI under automatic route
for development of seeds
The scheme ensures access to the means of irrigation to all agricultural farms in the
country to produce per drop more crop, thus bringing much desired rural prosperity
To increase agricultural production and productivity by increasing availability of water and
its efficient use.
Source: Ministry of Agriculture, Union Budget, TechSci Research

Note: RKVY - Rashtriya Krishi Vikas Yojana
DECEMBER
JANUARY
2016
2015
31
AGRICULTURE
FAVOURABLE POLICIES ARE SUPPORTING THE SECTOR GROWTH (2/2)
Pulses villages
Government has launched an initiative to spend USD65.1 million to promote 60,000

pulses villages in rain fed areas for increasing crop productivity and strengthening market
linkages
Incentivising agricultural
research
Realising that scientific and technical breakthroughs are critical to increasing agricultural
productivity, the government, in its FY16 budget, allocated USD612.31 million to
incentivise farm research
Budget 2015 16 aims at expanding R&D in the agricultural sector to improve its
productivity by enhancing crop yields
Regional Rural Bank

Credit Refinance Fund
Integrated Scheme of
Oilseeds, Pulses, Oil
palm and Maize
(ISOPOM)
The government plans to set up a Regional Rural Bank Credit Refinance Fund with a
capital of USD2.1 billion to enhance the capacity of RRBs to disburse short term crop
loans to small and marginal farmers
In budget for FY16, the government raised the target for agricultural credit from USD26.04
billion to USD132 billion
ISOPOM scheme was launched in 2004 to provide flexibility and promote crop
diversification; under ISOPOM, states can utilise the allotted funds to develop a crop of
their choice
Source: Ministry of Agriculture, Union Budget, TechSci Research

Notes: RRB Regional Rural Bank,
ISOPOM - Integrated Scheme of Oilseeds, Pulses, Oil palm and Maize
DECEMBER
JANUARY
2016
2015
32
AGRICULTURE
HIGHLIGHTS OF THE BUDGET 2015 -16
Agriculture GDP
Agricultural center for

excellence
Agriculture GDP growth for the current year is estimated at 4.6 per cent compared to 4.0
per cent in the last four years
A sustainable growth of 4 per cent is to be achieved each year
Announcement of plans to establish centers of excellence in agriculture in Assam and

Jharkhand, agriculture universities in Andhra Pradesh and Rajasthan, and horticulture
universities in Telangana and Haryana
Food grain productuion

is 251.12 MMT
Agricultural exports
estimated to increase
Food grain production is 252.68 million tonnes in 2014-15 compared to 257 million tonnes
in 2013-14
MSP for every agriculture produce increased significantly
Food grain production will reach 280.6 million tonnes by 2020-21
Agricultural exports likely to cross USD45 billion by 2019 20 higher than USD38.7 billion
in the year 2014-15
During FY16 (April-September 2015), agricultural exports stood at USD8.06 billion
Funds Allocated
Allocation of USD4.14 billion to the corpus of Rural Infrastructure Development

Fund(RIDF) in 2015 16
USD2.48 billion have been allocated for Long Term Rural Credit Fund
Allocation of USD7.46 billion for Short Term Co operative Rural Credit Refinance Fund
Government have funded an amount of USD830 million to support micro irrigation,
watershed development and Pradhan Mantri Krishi Sinchai Yojana
Source: Union Budget, Ministry of Agriculture * - 4th Advance estimates, TechSci Research
DECEMBER
JANUARY
2016
2015
33
AGRICULTURE
OPPORTUNITIES
DECEMBER
JANUARY
2016
2015
AGRICULTURE
OPPORTUNITIES
Farm management services
New agri business, which

provides inputs such as seeds,
fertilizers along with providing
advice and training farmers on
latest agricultural practices
Limited arable land against

growing population makes
agricultural inputs crucial
Huge opportunity exists for agri

input segments like seeds and
plant growth nutrients
It introduces efficiencies into the

whole gamut of agri practices
Provides assistance to sell

products at appropriate prices
Logistics
Agricultural inputs
In India, commercial seeds only

account for minor percentage (25
per cent) and huge demand is
expected for quality branded
seeds
The 12th Five Year Plan

estimated a potential storage
capacity expansion of 35 million
tonnes
Cold storage capacity needs to

grow rapidly from the current
level of 24 million tonnes
Private warehouse operators are

supported by multiple income
streams, subsidy and available of
credit
It is expected that 4 per cent

growth in the food grain storage
capacity would restructure
agricultural sector over the next
few years
DECEMBER
JANUARY
2016
2015
35
AGRICULTURE
INITIATIVES THAT WILL FURTHER PROP UP THE SECTOR
Foreign Direct
Investment (FDI)
MOUs/ Agreements
Foreign Direct Investment into India grew to USD44.877 million for the financial year 2014
- 15
Cumulative FDI from April 2000 to September 2015 in agriculture services and agricultural
machinery is USD2,211.17 million
The highest FDI came in services, followed by construction Development,
telecommunications, computer softwares and hardware, automobiles in 2014 15 (April
2014 May 2015)
MOUs/Agreements has been signed with 52 countries

Number of partnerships with other countries have reached 63
Provides better agricultural facilities in areas such as R & D, capacity building, germ
plasm exchange, post harvest management, value addition/food processing, plant
protection, animal husbandry, dairy and fisheries
Helps in improving Bilateral ties as well
Source: Ministry of Agriculture, DIPP, TechSci Research
JANUARY
2016
DECEMBER
2015
36
AGRICULTURE
GOVERNMENT INITIATIVES THAT WILL FURTHER PROP UP THE SECTOR
Government initiatives
Allocation of USD3.9 billion for RFID, USD234 million for long term rural credit fund,
USD7.03 billion for short term cooperative rural credit finance fund, USD3.9 billion for
short term RRB refinance fund
Target of USD132 billion agricultural credit during 2015 16
The Ministry of Food Processing Industries have taken few initiatives for developing the
food processing sector that would enhance the exports of agro and processed foods and
income of farmers
Government is planning to invest USD8 billion so as to revive 4 fertilizer plants and setting
up 2 plants to produce farm nutrients
In 2014, USD682.31 million has been allocated for the development of first phase of farm
loan waiver scheme by the Government of Telangana. The scheme is expected to benefit
3.6 million farmers who have taken a loan of approx. USD1600 or below before March 31,
2014
Financial Outlay of USD35.47 million has been announced under the National Dairy
Development Board(NDDB) to boost milk output and per animal production of milk
Israel have strengthened its bilateral ties with India by helping the farmers to choose the
right crops or vegetables and multiplying income of farmers
Source: Ministry of Agriculture, DIPP, TechSci Research

Note: RFID Radio Frequency Identification
JANUARY
2016
DECEMBER
2015
37
AGRICULTURE
CONTRACT FARMING: CHANGING THE FARM DYNAMICS (1/3)
The Government of Indias National Agriculture Policy envisages that Private sector participation will be promoted through
contract farming and land leasing arrangements to allow accelerated technology transfer, capital inflow and assured market for
crop production especially of oilseeds, cotton and horticultural crops
Foreign companies practicing contract farming in India
Companies
provide R&D and
agricultural
implements to
farmers
Stable and steady

supply of quality
farm output for
companies
Contract Farming in
India
Regular and
timely payments
to farmers and
credit facilities
Company
State
Crop
Cargill India
Pvt Ltd
Madhya
Pradesh
Wheat, Maize and

Soya bean
Hindustan
Lever Ltd
Madhya
Pradesh
Wheat
ITC - IBD
Madhya
Pradesh
Soybean
Appachi
Tamil Nadu
Cotton
Punjab
Milk
Punjab, TN
Chillies, Groundnut,
Seaweed, Tomato
and Basmati Rice
Nestle India
Ltd
Lesser logistics
cost for both,
farmers and
companies
DECEMBER
JANUARY
2016
2015
Reduces the price

risk fluctuations
and saves land
investments for
companies
Pepsi Foods
Pvt Ltd
Source: Company reports, Assorted articles, TechSci Research
38
AGRICULTURE
At present among successful contract farming practices undertaken in Gujarat:
Pepsi India, Arvind

mills, Jojoba Oil
Industries Ltd
These are some companies who have approached the govt. and shown keen interest in
doing research and contract farming in Agro-products in Gujarat under their backward
integration projects.
Godrej Agrovat Ltd.
Is also planning to grow high quality oil palm under contract farming in south Gujarat
region by providing imported tissue culture plants and farming technology to the contract
farmers.
Agrocell Corporation
Ltd.
Atreyas Agro Organic

Pvt. Ltd.
It is doing contract farming of organic cotton and sesame seeds covering about 5000
acres in Kutch and Surendranagar district of Gujarat since last 8 years.
The farmers get 7-8 % more price than ordinary cotton in current market and concession
in certain services from the company.
Plans to grow Jetrophs Curcas by contract farming. They have target of covering more
than 50,000 acres of irrigated & non-irrigated land of Gujarat.
DECEMBER
JANUARY
2016
2015
39
AGRICULTURE
Groundnut
Contract farming agreement
with farmers in Punjab
PMG technology sourced from
china
Company supported farmers in

R&D and other farm activities
Farmer started to grow two
crops in one year
Pepsi Co
Yields increased to 3-4

tonnes per hectare, much
above national average of 1
tonnes per hectare
Model extended
to other states
Barley
Created procurement centers to
procure Barley in Rajasthan
SAB Miller
Provide higher-quality certified

seeds and training to 5,600
farmers in Rajasthan
Increase in yields from 1.9

tons a hectare to 3.8 tonnes
a hectare within the space of
one year
Others followed
the model
Note: PMG - Plastic Mulch Groundnut
DECEMBER
JANUARY
2016
2015
40
AGRICULTURE
SUCCESS STORIES
DECEMBER
JANUARY
2016
2015
AGRICULTURE
RALLIS INDIA: BENEFITTING FROM DEMAND OF AGRICULTURAL INPUTS (1/2)
Salient characteristics
Rallis is a leading player in the agricultural inputs business and one of the largest player in agri chemical business
Crop protection is the major segment for the company and it plans to expand its presence in seeds and PGN
As part of the above mentioned plans, Rallis acquired a research-led seeds company Metahelix and launched a PGN
product in the name of Ralligold
Rallis India has set up Rallis Farm Management services to undertake contract farming
Rallis Research Centre has won the prestigious New Millennium Indian Technological Leadership Initiative award for a
molecule discovery
Launched GeoGreen which has established itself as a brand for soil conditioner. It improves the soil health to enhance the
productivity
Programmes like MoPu More Pulses, Samrudh Krishi have been initiated to drive the productivity of various agri services
Major business segments
Crop protection
Agri services
Rallis
Contract farming
Seeds and PGN

Note: PGN - Plant Growth Nutrients
DECEMBER
JANUARY
2016
2015
42
AGRICULTURE
RALLIS INDIA: BENEFITTING FROM DEMAND OF AGRICULTURAL INPUTS (2/2)
Net sales (USD million)
Profit before taxes (USD million)
286.28
297.26
39.40
38.40
36.76
266.45 265.14
233.61
174.30
31.80
30.50
185.30
31.10
31.70
22.30
157.77
20.56
140.50
FY08
FY08
FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY16*
FY16*
Source: Company website, TechSci Research
*- Revenue is for six months ended September 2015
DECEMBER
JANUARY
2016
2015
43
AGRICULTURE
USEFUL INFORMATION
DECEMBER
JANUARY
2016
2015
AGRICULTURE
INDUSTRY ASSOCIATIONS (1/2)
Autonomous Bodies
National Institute of Agricultural Extension Management
Rajendranagar, Hyderabad500 030, Andhra Pradesh
Phone: 040-24016702 to 706
Fax: 040-24015388
National Institute of Agricultural Marketing (NIAM)

Bambala, Kota Road
Jaipur302033, Rajasthan
Phone: 0141-2770027
Fax: 0141-2771938, 2770027
Boards
Central Insecticides Board and Registration Committee
Machinary Store Building,
N.H.IV Faridabad
Phone: 0129 -2413002
Coconut Development Board

Kera Bhavan, SRVHS Road, Kochi
Kerala682011
Phone: 0484-2376265, 2377267, 2376553
Fax: 0484-2377902
DECEMBER
JANUARY
2016
2015
45
AGRICULTURE
INDUSTRY ASSOCIATIONS (2/2)
National Dairy Development Board (NDDB)
PB No 40, Anand388 001
Phone: 02692-260148/260149/260160
Fax: 02692-260157
National Horticulture Board (NHB)

Ministry of Agriculture, Government of India
85, Institutional Area, Sector-18
Gurgaon122015, Haryana
National Oilseeds and Vegetable Oils Development Board

(NOVOD)
86, Institutional Area, Sector-18
Gurgaon122015, Haryana
Councils
Indian Council of Agricultural Research (ICAR)
Krishi Bhavan, New Delhi 110 114
Phone: 91-11-25846010
DECEMBER
JANUARY
2016
2015
46
AGRICULTURE
GLOSSARY (1/2)
AIBP: Accelerated Irrigation Benefit Programme
Breeder seeds: Seeds move from germ-plasm (research) stage to breeder stage
CAGR: Compound Annual Growth Rate
Certified/quality seeds: Foundation seeds are further multiplied to get certified seeds, which are sold to farmers
FMTTI: Farm Machinery Training and Testing Institutes
Foundation seeds: Breeder seeds are multiplied as foundation seeds
FY: Indian Financial Year (April to March) FY12 implies April 2011 to March 2012
KCC: Kisan Credit Card
MSP: Minimum Support Prices
NFSM: National Food Security Mission
NMAM: National Mission on Agricultural Mechanisation
PGN: Plant Growth Nutrients
DECEMBER
JANUARY
2016
2015
47
AGRICULTURE
GLOSSARY (2/2)
RKVY: Rashtriya Krushi Vikas Yojana is a central government scheme providing funds to state governments to spend on
agriculture
Wherever applicable, numbers have been rounded off to the nearest whole number
DECEMBER
JANUARY
2016
2015
48
AGRICULTURE
EXCHANGE RATES
Exchange rates (Fiscal Year)
Exchange rates (Calendar Year)
Year
INR equivalent of one USD
Year
INR equivalent of one USD
200405
44.81
2005
43.98
200506
44.14
2006
45.18
200607
45.14
2007
41.34
200708
40.27
200809
46.14
2008
43.62
200910
47.42
2009
48.42
201011
45.62
2010
45.72
201112
46.88
2011
46.85
201213
54.31
2012
53.46
201314
60.28
2013
58.44
2014-15
61.06
2014
61.03
2015-16(Expected)
61.06
2015(Expected)
63.72
DECEMBER
JANUARY
2016
2015
Source: Reserve bank of India,

Average for the year
49
AGRICULTURE
DISCLAIMER
India Brand Equity Foundation (IBEF) engaged TechSci to prepare this presentation and the same has been prepared
by TechSci in consultation with IBEF.
All rights reserved. All copyright in this presentation and related works is solely and exclusively owned by IBEF. The
same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any
medium by electronic means and whether or not transiently or incidentally to some other use of this presentation),
modified or in any manner communicated to any third party except with the written approval of IBEF.
This presentation is for information purposes only. While due care has been taken during the compilation of this
presentation to ensure that the information is accurate to the best of TechSci and IBEFs knowledge and belief, the
content is not to be construed in any manner whatsoever as a substitute for professional advice.
TechSci and IBEF neither recommend nor endorse any specific products or services that may have been mentioned in
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any reliance placed on this presentation.
Neither TechSci nor IBEF shall be liable for any direct or indirect damages that may arise due to any act or omission
on the part of the user due to any reliance placed or guidance taken from any portion of this presentation.
DECEMBER
JANUARY
2016
2015
50

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AGRICULTURE

For updated information, please visit www.ibef.org

Market Overview and Trends...6

Success Stories ......41

For updated information, please visit www.ibef.org

Source: Ministry of Agriculture , Government of India, TechSci Research

For updated information, please visit www.ibef.org

A large population is the key driver

Rising urban and rural incomes

External demand has also been

High proportion of agricultural land

Leading producer of spices, jute,

Increasing demand for agricultural

Promising opportunities in storage

Schemes like Paramparagat Krishi

For updated information, please visit www.ibef.org

MARKET OVERVIEW AND TRENDS

50% increase in seed subsidy

Source: Ministry of External Affairs, RBI, Ministry of Agriculture, TechSci Research

For updated information, please visit www.ibef.org

This technique facilitates retrieval of data and data

More than a dozen of services of innovative

Small Farmers Agribusiness Consortium

Focused on creating wider linkages for FPOs to

An ICT backed platform has been provided that

Pradhan Mantri Krishi Sinchai Yojana

Allocation of USD830 million for the development

State government are compelled to fund the

Paramparagat Krishi Vikas Yojana

This scheme ensures the promotion of organic

Adoption of farming will promote the balanced use

For updated information, please visit www.ibef.org

GDP of agriculture and allied sectors in India was

Agriculture is the primary source of livelihood for about 58

Source: Ministry of Agriculture, Print Release, RBI, TechSci Research

For updated information, please visit www.ibef.org

Under the Union Budget 2015 16, allocation of USD879

A special scheme has been launched in North Eastern

Source: Ministry of Agriculture, TechSci Research

For updated information, please visit www.ibef.org

There are two major agricultural seasons in India: Kharif

Total food grains production in India reached an all-time

Rabi season lasts from October to March (winter); wheat is

Source: Finance Ministry, Ministry of Agriculture,

For updated information, please visit www.ibef.org

Area Sown in FY16* (lakh hectares)

Source: Ministry of Finance, Ministry of Agriculture, TechSci Research

For updated information, please visit www.ibef.org

During the last five years, production as well as yields of

The yield of rice reached 2.39 tonnes/hectare in FY15*

In 2014 15, production of wheat according to the fourth

Production of wheat and rice reached an all-time high in

Production of Wheat (million tonnes)

Source: Ministry of Agriculture, TechSci Research

For updated information, please visit www.ibef.org

Production (million tonnes)

Area (million hectares)

Fruits (million tonnes)

Fruit and vegetable production of top four countries (2013)