Maximising Agriculture Production through Strategic creation of Clusters through Smart & Secured Governance

Secured Governance is a mechanism which acts as a growth centre for the individual sector with all other sectors playing a supporting role for sustainable growth and development. The very concept of “Secured’’ here implies a secured convergence or meeting with various sectors defining a growth for an economy.

Maximising Agriculture Production through Strategic creation of Clusters through Smart & Secured Governance_thepolicy times

Real growth in ‘Agriculture & allied’ sector was lower in 2018-19 at 2.4%, after two years of good agriculture growth. As per the 3rd Advance Estimates released by the Ministry of Agriculture & Farmers Welfare, the total production of food grains was estimated 292 million tons in 2019-20. There was a significant decline in food prices in 2018-19 as indicated by nearly zero per cent consumer food price inflation in 2018-19 with price contraction straight for five months in the year. Among world nations, India is the largest producer of fresh fruits. It mainly produces Sesame seeds, fennel, badian, jute, cashew nuts, pulses, ginger turmeric, mangoes, chillies and peppers. India holds the second largest population of cattle. It has around 281million cattle.

India holds the second position in producing cashew, cabbage, cottonseed, fresh vegetables, garlic, cardamom, onions, wheat, rice, sugarcane, tomatoes, coconut, groundnut, tea, green peas, cauliflower, potato and inland fish.

The concept of developing an Agriculture Hub under Secured Governance is essentially a strategically located multi-modal platform. It will have state-of-the-art facilities, at par with the best in the contemporary international scenario, duly adapted for local conditions. The project will address complete backward and forward linkages from farmers to the consumers. This has to start at Village level going up to specialized Smart Agri Cities.

Secured Governance is a mechanism which acts as a growth centre for the individual sector with all other sectors playing a supporting role for sustainable growth and development. The very concept of “Secured’’ here implies a secured convergence or meeting with various sectors defining a growth for an economy.

Secured Governance or SG lays emphasis on utilizing the inherent potentialities of a region in a comprehensive way. A particular region may be best suited for developing and establishing an industrial hub, due to its advantageous location, well-developed infrastructure and logistical support systems, while another region may be more conducive to creating an educational hub due to its demography, cultural inclination and various other supporting factors. Likewise, a geographical setting or a location may be particularly well-suited for the production of agricultural commodities due to a combination of natural advantages and unmatched agricultural potential.

The cultivation of world-famous Nagpur orange in Vidarbha region of Maharashtra has brought indispensable glory to the region. Kashmiri saffron is considered the world’s best saffron for its extraordinary aroma, powerful colouring and flavouring capabilities. Doon Valley is famous for its Dehradooni Basmati. These are just a few examples, there are many such regions in India which have immense agricultural potential.

But have we been able to tap the inherent potential of these regions to the fullest? Taking Nagpur as an example, Nagpur orange’s survival hinges precariously on its return to sustainable cultivation. Excessive chemical use, waterlogging and extensive monoculture have badly affected the production of the oranges. Till date, orange has survived by tearing down everything else in its environment, but the limit has been reached. Remedies may involve steps like the reduction of acreage of orange and the introduction of mixed orchards to restore environmental balance. Progressive utilization of the available resources is at the core of implementing Secured Governance.

India is a country which produces tobacco, rapeseed, coconut and tomatoes in large amount, and is the third-largest producer of these crops. Production of horticultural crops has increased considerably as compared to the situation a couple of decades ago. The area under horticulture crops has increased from 16.6 million ha in 2001-02 to 25.66 million ha in 2019-20 with a corresponding increase in production from 146 million tonnes to 320.48 million tonnes. Total Horticulture production in 2019-20 (1st Advance Estimates) is expected to be 0.84% higher than 2018-19. Increase in Vegetables, Aromatics and Medicinal and Plantations is envisaged but a decrease in Fruits, Flowers and Spices is expected. The Fruits production is expected to be lower by 2.27% in 2019-20 over 2018-19. It is mainly due to loss in production of Grapes, Banana, Mango, Citrus, Papaya and Pomegranate. Increase of 2.64% in the production of vegetables in 2019-20 over 2018-19.

Agricultural productivity depends on several factors.  These include the availability and quality of agricultural inputs such as land, water, seeds and fertilizers, access to agricultural credit and crop insurance, assurance of remunerative prices for agricultural produce, and storage and marketing infrastructure, among others. As of 2019-20, more than 41.49% of the total workforce of the country, i.e. 572.5 million persons were employed in agriculture. The share of the population depending on agriculture for its livelihood consists of landowners, tenant farmers who cultivate a piece of land, and agricultural labourers who are employed on these farms. The agriculture sector’s contribution to the Gross Domestic Product (GDP) decreased from 54% in 1950-51 to 15.2% in 2019-20.

The country’s requirement for food grains in order to provide for its population is projected to be 300 million tonnes by 2025.  The estimate of food grains production in 2019 – 20 was 292 million.  This implies that the crop output needs to grow at an annual average of 2%, which is close to the current growth trend.

Yield in different countries (tonnes/ha)

Key issues affecting agricultural productivity include the decreasing sizes of agricultural landholdings, continued dependence on the monsoon, inadequate access to irrigation, imbalanced use of soil nutrients resulting in loss of fertility of the soil, uneven access to modern technology in different parts of the country, lack of access to formal agricultural credit, limited procurement of food grains by government agencies, and failure to provide remunerative prices to farmers.

SG stresses upon utilizing the unique potentialities of place in a way that invigorates the growth of other interlinked sectors in perfect equilibrium.

The hub will be equipped with facilities for warehousing, food processing, cold storages, central auctioning, ripening chambers, quality control laboratories, one-stop shopping centres, Agri-clinic and extension services, information kiosk etc. Integration of such facilities will help in shortening the supply chain for the producers who have to traverse a long marketing channel to reach the market due to unavailability of the necessary infrastructure. By a combination of transportation, storage services, training facilities and support from other related sectors, Agri-Hubs would emerge as strategic locations that involve end-to-end solutions and improve efficiencies while enabling apportionment of associated capital costs across a larger base of users leading to significant cost reductions.

The central idea of the proposed concept is helping farm earnings grow by shortening of the supply chain, establishing cost-effective and standardized linkages. The concept intends to revive market extension activity with re-oriented and appropriate physical infrastructure and technological support. Development of Agriculture Hub will make way for the development of a secured township along with the Hubs in strategically defined intervals divided into various clusters which will include infrastructures such as Residential complexes, Official and Industrial Facilities, Power and Water, Banking, Educational Institutes, Transport facilities and infrastructures, Healthcare, Hospitality Sectors, Retail Market, and much more. With improved resource allocation, enhanced governance, Interdependency among sectors and transparency in the system going hand in hand, development and effective use of Information Technology and Innovation can deliver a safer, cleaner and a self-sustaining Agriculture Sector.

Agriculture Hub will facilitate a professionally managed competitive alternate marketing structure that provides multiple choices to farmers for the sale of produce along with a comprehensive solution to meet key needs of all the stakeholders. A well-integrated approach will help establish efficient linkages between the farmers, village cluster, producer, and the market centre. This would also include a reduction in the involvement of intermediaries in the supply chain, which will further expand the markets for primary agricultural products and add value by vertically integrating such services.

Such facilities endeavour to integrate farm production with buyers by (a) offering multiple choices to farmers for the sale of products such as electronic auctioning (b) facility for direct sale to exporter, processor and retail chain network under a single roof. In addition, it would provide storage infrastructure thus offering the choice to trade at a future date to the participants. It is envisaged to offer a one-stop-solution that provides logistics support including transport services & cool chain support and facility for storage (including warehouse, cold storage, ripening chamber, storage shed, etc.), facility for cleaning, grading, sorting, packaging and palletization of produce and extension support & advisory to farmers. An integrated facility in terms of a modern market centre with suitable logistics support would address all the issues in the sector and suit the need of the hour.

Agriculture hubs would offer several benefits to the different stakeholders in the value chain. Farmers would get multiple choices for marketing their produce apart from the traditional markets. They will realize the right value for their produce. This would be enabled through the assurance of the right price for the right quality and correct weight. It would facilitate greater convenience for the farmers in selling produce. The cash settlement would be faster as compared to the traditional markets. It would facilitate the availability of better infrastructural facilities and reduce the wastage of the produce.  There would be the minimization of pre and post-harvest losses, transit losses and storage losses. Electronic connectivity of the auction houses to the existing e-Naam project would provide real-time information to both buyers as well as sellers.

The buyers would also get benefitted in various other ways. Graded and sorted produce would be available to the buyers. Produce in the requisite lot sizes would be available as a result of which transaction costs would be minimized by way avoiding collection/ purchase from a large number of sellers.  Quality and hygienic produce would be available to them. Efficient logistics would minimize the wastages of the perishable produce.

These Agriculture Hubs would form the first tier in the National Agri Network (NAN). The second tier would consist of a scaled-down basic rural infrastructure of the same which would serve as a one-stop-shop primarily for the farmers. At the same time, it would also provide buying and trading facilities to local or regional traders. The difference between a local hub and a national hub would be of scale and magnitude. This local Agriculture Hub would cater to the requirements of small and marginal farmers holding less than two hectares of land. It also must be pointed out that 86% of all farmers in the country fall in this category. These are the farmers who do not have the potential to bear the transportation costs involved in moving their produce to exist Agri markets and mostly end up selling it to the village traders at a discounted price.

It’s also pertinent to mention that the basic hub needs to be considered at the lowest administrative unit of the country which is an Administrative Block. Since we have nearly 7600 such blocks in the country, the creation of these hubs would in itself give a huge impetus to the rural economy. The second impetus would come as economic activity in these hubs picks up pace. As can be imagined, this would involve a huge investment from the government, whether it’s central or state. This would necessitate a phased implementation wherein some pilot projects, both basic as well as an upgraded national Agri hub, are developed to see the response it generates. Lessons learnt from such projects can be used to make suitable amends in the overall plan. In due course, an entire economic ecosystem would develop around these rural hubs creating jobs and economic opportunities for millions of Indians.

Thus to conclude, Secured Governance in Agriculture through establishing Agriculture Hubs will diversify and stabilize the economy in a big way. It will help generate significant revenues in the region. It will generate local employment and business opportunities while boosting the development of infrastructure and increase property valuation. Secured governance in agriculture will create an environment which will motivate farmers, provide an interactive coupling between technology, economy and environment and provide a society for speedy development of food processing industries to build up a substantial base for the production of value-added agro-food products for domestic and export markets.

This model of Secured Governance would provide a platform for various economic stakeholders and act as a catalyst to ensure that the rural economy, and in the process living standards of our villagers, see a marked improvement, in a time frame of just a few years. Lastly, it must be said that the implementation of Secured Governance in Agriculture will not only boost the overall growth and development of the sector but will also sustain it over a considerable period of time.  This would give farmers their deserved quality of life. The villages would become Mini Smart Cities and it would be a National Reincarnation, a transformational change.

By Dr P. SekharDr. P. Sekhar

Chairman, Unleashing India, Global Smart City Panel, MTGF


By Lt Col Manish Jaitly (Retd).

Army veteran, Alumni of IIM A,

Reputed Author & researcher for Agri and Rural development

Article Name
Maximising Agriculture Production through Strategic creation of Clusters through Smart & Secured Governance
Secured Governance is a mechanism which acts as a growth centre for the individual sector with all other sectors playing a supporting role for sustainable growth and development. The very concept of “Secured’’ here implies a secured convergence or meeting with various sectors defining a growth for an economy.
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The Policy Times
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