The Agricultural and Processed Food Products Export Development Authority (Apeda) has urged the central government to allow 10-20 per cent of annual agricultural produce to be exported.
Apeda-registered products have seen a sharp decline in export and a major reason given is frequent change in government policy, resulting in importers switching to alternative sources, for long-term supply assurance.
The country's agricultural and processed food export was $33.4 billion in 2016-17, from a record $42.9 bn in 2013-14. Rice, pulses, wheat and sugar have all seen frequent change in government policies; sometimes, export has been banned and at other times, duties have been raised or lowered. Depending on climatic conditions and output, the government keeps changing the agri export policy, to suit domestic need. These changes have made India an irregular supplier of produce to global importers.
"These frequent changes in export policy and imposition of Minimum Export Price might have made India considered as not a reliable supplier. There is a need to have a stable export policy, in such a way that at least there is no impact on export of 10-20 per cent of production of an item in a season. The balance quantity would be available for the domestic market," said D K Singh, chairman of Apeda, while issuing the draft of an 'Export Promotion Strategy', inviting public comment and suggestions.
Experts say keeping this much for export would suffice, as shipments have never exceeded such a proportion. At 2.2 per cent, India is at ninth position in global agri trade. America has 10.4 per cent, the European Union 10 per cent and Brazil has 5.1 per cent. Yet, India is considered to have a huge potential for export, the quality of its agri products matching with global standards.
Export of agri items contributes 13.1 per cent of agricultural gross domestic product. Therefore, it has a large impact on the economy. While India has transformed from a deficit to surplus country in a number of agri commodities, challenges for their transportation, marketing and efficient market access continue to hinder growth.
"A sustained export market requires a reliable supplier. If we have an accurate agriculture forecasting technique and better estimate of a buffer stock, we can definitely make a medium-term policy for agri exports. Thus, we require a reliable policy, based on scientific estimate of crop production, buffer stock, future projection and domestic demand. If the future projection goes wrong, an option for import should be kept open," says Ajay Sahai, director-general, Federation of Indian Export Organisations.
"There is a need for concerted and well-conceived promotional strategy for the next five years," said Singh.