India is one of the largest agricultural economies, with 60% of its population engaged in this sector. With fast developments taking place in agriculture, Indian economy is at the threshold of another revolution. Indian agriculture promises great future with new opportunities for growth and development. However, the agricultural scenario throughout the world has been witnessing a sea change for the last two decades. We are faced with a situation where rising demand for food is not being met with a similar supply side response. Modern technology has, no doubt, widened the options available to the farmers. Yet, the world seems to be facing the prospect of food shortages and rising food prices, with India being no exception to it.  The reason for this is a sharp decline in global food stocks that were the lowest since 1980. The Indian green revolution demonstrated the vital role played by technology in bringing a boost in productivity. However, it was not accompanied by desired investment in the food processing sector, improvements in quality levels of products, advancement in processing efficiency and last but not the least reductions in post-harvest losses. The situation is becoming all the more complex due to the fact that development of biofuels is being promoted by many countries. As a result, there is a direct link between oil prices and food prices. There is shortfall of eight million metric tons of wheat. This calls for the global community and global agencies to fashion a collective response to meet one of the most urgent challenges of our times head on. These global partnerships should aim to facilitate the exchange of latest technical know-how and promote cooperation in related aspects of agricultural development with focus on improving quality, productivity, post-harvest management, marketing and trade related concerns.

 The Indian Food Processing Industry: India has made a significant progress in agriculture and food processing sector in the last few decades. The country is sitting on a goldmine of processing food. India’s potential to become a top player in the agriculture sector is proved by the fact that the country already has many firsts to its credit.  India is world’s largest producer of milk and cereals in addition to being second largest producer of food, fruits and vegetables. It is also the largest exporter of cashew and spices. India is the world’s second largest producer of food and the food production is likely to double in the next decade.  Thus, India has a great potential for domestic as well as foreign market for processed food. The world processed food business runs into billions of US dollars and India’s share in it is just 1.5 per cent of the international food trade. According to government estimates, the total turnover of the food market is approximately Rs 2,500 billion out of which value-added or processed food products comprise Rs 800 billion. With food processing sector being declared as a priority sector, food processing industries is going to be on the driving seat of the Indian economy in the coming years. It is going to generate high returns on investment as well as employment. There will be over 20% usage of agri-products in processing and over 35 per cent towards value addition in the next five year plan.

 The sector is attracting huge investments both from foreign countries and from domestic investors. To achieve a greater investment level in the coming years, there is a need to redesign our development strategies and adherence to quality control norms. To harness the great potential of the food processing sector, there is a need for bringing all the intermediaries (investors, processors, producers, buyers and government agencies) in agriculture and food processing industries together on a common platform.

 Organized retail has an important role to play and it can become instrumental in changing the agriculture scenario of the country. It can help to reduce wastages, enhance farmers’ income, create new employment through food trade and promote better prospects for rural population.

 There is a need for a significant improvement in the productivities (of different agricultural products), better quality, efficient processing technologies and effective packaging of these products. By adhering to all these guidelines, India can capture the vast international market for various agriculture products.

NIGERIA – SCENARIO OF AGRICULTURE & FOOD PROCESSING:

Nigeria’s agriculture sector accounts for over 26.8% of GDP and two-thirds of employment.   The largely subsistence agricultural sector has not kept up with rapid population growth, and Nigeria, once a large net exporter of food, now imports some of its food products. However, Nigeria has begun to focus on rebuilding its rich agricultural sector, which was neglected during the oil boom years. Nigeria remains a major market for food and agricultural products, with imports worth more than $3.0 billion annually. Although imports of cereals by Nigeria are forecast to remain above 4.5 million tonnes in 2008 (mostly wheat and rice), this represents only 15 percent of the country’s total domestic cereal utilization.

 Nigeria’s food and drink industry continues to be one of the most dynamic industry and happens to attract increased foreign investments. Coca-Cola, the world’s largest beverage company, announced a 4% rise in underlying operating profit to US$6.3bn during 2006. Swiss food and drink giant Nestlé, a leader in the coffee and cocoa markets, has decided to expand its production in the country. This investment is surely a positive step towards sustainable growth. The main reason behind such expansion is the fact that cocoa is a major crop in Nigeria and it is the world’s fourth-largest producer.  Such investments, particularly those made by large MNC’s, are welcome news in Nigeria, given the country’s disturbed state of affairs. BMI has forecast considerable growth in food consumption in both overall US dollar terms and in per-capita terms to 2011. Total food consumption will reach US$35.41mn in 2011, while per-capita consumption will reach US$229.7 which is a significant improvement on 2006 levels indicating an 18.9% increase. Although the food and drink and agricultural industry will surely continue to face certain obstacles, these above-mentioned developments are positive signs for Nigeria’s food and drink industry.

 The government has started evolving different strategies and programs to bring a boost to the productivity of the various agricultural products. International institutions including World Bank and the African Development Bank are coming forward to help the country by lending loan facility for bringing the desired changes in the agricultural productivity. This has resulted in increased opportunities for sale of agricultural machinery; storage facilities to protect the harvest; and food processing and packaging equipment to market the end product. There is an urgent need to increase access of food to the most vulnerable sections of the society. The tariff policy is being reviewed and is going to bring new opportunities for growth in agricultural and food processing sector. Nigeria has a huge domestic market of trunk line roads and this offers numerous opportunities for development of large scale food processing industries. Nigeria has a huge market for capturing the African regional market.

TOGETHER WE CAN:

Nigeria and India need to work together to reverse the existing imbalances in international financial and trading systems and make them more development friendly. Such partnerships are needed to steer global political and economic agenda towards addressing the future of both the nations. There is a greater need to share our experiences on effective and viable strategies for achieving overall development and eliminating poverty which is the root cause of all ills.  We need greater global and national efforts to increase investment in rural areas to make developing nations become self sufficient and sustain growth and development. The international organizations like World Bank, FAO, IFAD and UNIDO must come forward to make this a possibility.

Filed under: Food Processing