1. Status of Fruits & Vegetables Production and Processing in NER April 20, 2011

2. Agenda Overview Production of Fruits & Vegetables Huge Wastage Constraints Thrust areas Supportive policies of GoI Basic Parameters of Good Food Processing Industry Policy Discussions

3. Overview Despite strong raw material base India is unable to tap potential for processing and value adding in perishables like fruits and vegetables Huge wastages, estimated at about 35%, the value of which is approx. Rs. 33,000 crore annually However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India Huge wastages, estimated at about 35%, the value of which is approx. Rs. 33,000 crore annually However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India Huge wastages, estimated at about 35%, the value of which is approx. Rs. 33,000 crore annually However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India Despite strong raw material base India is unable to tap potential for processing and value adding in perishables like fruits and vegetables Huge wastages, estimated at about 35%, the value of which is approx. Rs. 33,000 crore annually However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India Despite strong raw material base India is unable to tap potential for processing and value adding in perishables like fruits and vegetables Huge wastages, estimated at about 35%, the value of which is approx. Rs.33,000 crore annually However, only 2% of fruits and vegetables in India are processed India produces 9% of world’s fruits and 11% of World’s Vegetables Food is the largest consumption category in India

4. Area and Production of Fruits & Vegetables 2009-10 in NER STATE/UT’SFRUITSVEGETABLES AreaProductionAreaProduction ARUNACHAL PRADESH72.0107.904.2038.50 ASSAM117.301575.50255.204569.90 MANIPUR38.40281.9019.90221.80 MEGHALAYA32.90294.8044.30415.80 MIZORAM27.10328.3010.60179.10 NAGALAND30.80223.7010.4078.30 SIKKIM12.2018.5028.70147.70 TRIPURA36.90573.8032.50446.90 TOTAL367.703404.40405.806097.90 TOTAL ALL INDIA6329.2071515.507984.80133737.60 SOURCE: NATIONAL HORTICULTURE BOARD, GOVT. OF INDIA Area in '000' Ha Production in ‘000’ MT

5. Production of Fruits 2009-10 STATE/UTsBANANACITRUSGUAVAPAPAYAPINEAPPLEOTHERSTOTAL ARUNACHAL PRADESH13.335.6 34.4 24.7 107.9 ASSAM805.2225.988.2119.1223.0114.01575.5 MANIPUR 33.746.70.0 103.5 98 281.9 MEGHALAYA82.843.10.05.6106.856.5294.8 MIZORAM 207.764.7 20.36.3 29.3 328.3 NAGALAND 62.743.71.56.880.1 28.9223.7 SIKKIM3.213.10.1 2 18.5 TRIPURA105.633.91.718.5117.5296.6573.8 TOTAL1314.3506.891.5170.3671.6650.03404.4 TOTAL ALL INDIA 26469.59638.02571.53913.51386.827531.271515.5 Production in ‘000’ MT SOURCE: NATIONAL HORTICULTURE BOARD, GOVT. OF INDIA

6. Production of Vegetables 2009-10 STATE/UTsPOTATOCABBAGEC.FLOWERTOMATOBRINJALOTHERSTOTAL ARUNACHAL PRADESH31.70.0 6.838.5 ASSAM589.7614.2351.3379.5253.02382.24569.9 MANIPUR15.272.822.927.20.083.6221.8 MEGHALAYA221.70.0 194.1415.8 MIZORAM20.944.4 6.7 107.2179.1 NAGALAND10.03.00.24.02.259.078.3 SIKKIM44.37.03.94.11.686.8147.7 TRIPURA99.442.627.629.638.9208.9446.9 TOTAL1032.8783.9405.9451.1295.83128.56097.9 TOTAL ALL INDIA 36577.37281.46569.012433.210563.060313.6133737.6 Production in ‘000’ MT SOURCE: NATIONAL HORTICULTURE BOARD, GOVT. OF INDIA

7. Food Processing Sector in India Huge wastage across the supply chain leads to lower level of processing and hence low value addition… SegmentIndiaOther Countries Fruits and Vegetables 2.2% US A (65 %), Philippines (78%) China (23)%; Marine26% 60-70% in developed countries Poultry6% Buffalo Meat20% Milk35%60-75% in developed countries Level of Processing across Segments Field Losses (Pest,Diseases, Rodents etc) Pre-Processing (e.g. inefficient harvesting, drying, milling) Transport (e.g. spillage, leakage) Storage (e.g. technical deficiencies) Processing & Packaging (e.g. excessive peeling, washing) Marketing (e.g. spoilage, rotting in stores) Wastage by Consumer (e.g. over eating, food wastage)

8. Perceived Constraints  Low incomes and high share of basic foods in household consumption.  Socio-cultural factors – Preference for freshly plucked fruits.  Low productivity, high wastage.  Inadequate infrastructure for sorting / grading / packing.  Lack of trained manpower for processing storage, marketing, branding.  APMC Act which restricts sourcing materials from farmers.  Lack of common policy on Contract Farming.  Low access to credit to farmers.  Inability to attract investment by large corporate houses due to unreliable sources of supply of raw material.

9. Thrust areas Enhanced income of farmers Increased level of processing of perishables from 6% to 20% Increased value addition from 20% to 35% Increased share in global food trade from 1.5% to 3% in next 15 years Promote dynamic/competitive food processing industry Achieve integration of food processing infrastructure from farm to market Have transparent and industry friendly regulatory regime

10. Supportive Policies of GoI 1NEIPP 2007 for industry including Food Processing Industry 2 Transport Subsidy Scheme and Horticulture Mission for NE & Himalaya States 3 Development of products and processes for secondary agriculture, food industry and bio-processing sectors 4Infrastructure Development and Technological Upgradation 5 Quality Control / R&D, H.R & Institutional Development

11. Felt needs in NER Promote Nutrition Foods Support Backward Integration Market Access to Farmers Technology Upgradation Processable variety of Crops Increase Promotional Activities Investment in Hard/Soft Infrastructure Harmonisation of Taxes

12. Discussion to follow:- Preparation of action plan – identify fruits and vegetables with potential for food processing in specific North East States / Areas. How to promote agro based / food processing sector in NER – put in place a model supply chain by bringing in farmers, traders, processors, extension machinery and R&D Institutes together. Amendments (if required) in existing policies – in NEIPP 2007, TSS 1971, to promote the agro based sector/industries. How to attract investment including FDI in the sector. Suitability of for autonomous industry driven boards for individual crops. Need for preferential treatments / liberalising excise regime / reducing excise duties of Centre / States for individual products such as Pineapple in Tripura.

13. Ultimately ? Can our discussion lead to a strategy which is not fragmented Ministry / Scheme wise but encompasses all aspects of a dynamic food processing sector in NER ?