COVID 19: FICCI makes 14 recommendations for agriculture and allied sectors

In the wake of COVID 19 pandemic lockdown, leading industry body, Federation of Indian Chambers of Commerce and Industry (FICCI) has recommend for effective procurement and storage of Rabi harvest and approaching Kharif sowing. The nation-wide lockdown has disrupted the Rabi crops’ harvesting across the country.

To make smooth agricultural operations, FICCI has activity-wise recommendations.

1. Allow mandis to operate smoothly

For ensuring that the supply chain of food, including processed food, is not disrupted, it is important that mandis are allowed to run after ensuring appropriate protection and hygiene measures. Food processing units should be allowed to function without any artificial distinction between essential and non-essential.

2. More procurement centers should be opened

The number of procurement centers need to be increased in the states where arrivals are expected to start in a few days. Farmers should not have to transport more than 3-km to offer their produce for minimum support price (MSP) operations. The number of trucks for lifting the procured stocks from procurement centers needs to go up substantially. Otherwise, there will be shortage of space at procurement centers. Sufficient storage space needs to be created at warehouses of Food Corporation of India (FCI) and state agencies also. If covered warehouses are not available, proper arrangements for CAP storage of wheat should be made.

3. Relaxation in APMC regulations

APMC regulations should be relaxed which prohibit sale and purchase outside mandi jurisdiction. Farmers of perishable produce such as vegetables, fruits, milk, fish, meat etc. should be allowed to sell their produce outside the regulated markets.

4. Smooth transportation

Govt. must ensure that the police help farmers who are bringing their produce to mandis or the places where it can be sold. This includes retail shops as well as street vendors who are selling the produce in the urban areas. Smooth transportation of all food items into urban areas must be allowed.

5. Storage charges should be taken care by government

Storage charges incurred by small and marginal farmers for six months stocks kept by them in WDRA (Warehousing Development and Regulatory Authority) registered warehouses or cold storages for which eNWRs (negotiable warehouse receipts in electronic form) have been issued, should be taken care of by the Government.

6. Make fumigation and pest management as essential services

Guidelines issued by the Union Ministry of Home Affairs (MHA) on the announcement of the 21-day lockdown, did not specifically include “Fumigation and Pest Management as essential services”. “Pest Control Services & Fumigation Services at warehouses” are equally required for blocking the spread of the Corona Pandemic and keeping agri commodities infestation free during storage. Therefore, this should be enlisted as essential services. As of now, only Maharashtra had exempted “Fumigation & Pest Management” services in their orders. * As per scientists of the Indian Council of Agricultural Research (ICAR), around 35 percent of India’s agricultural crop is lost due to pest infestation, a significant part of which is during storage.

7. Ensuring supply of seeds and other agri-inputs for Kharif season

Every state has issued advisory and exempted agri- input industry, especially seeds). However, agriculture officials in districts do not have clarity regarding issuance of permits for opening the premises and permits for employees movements.

The current challenge lies in the implementation of the state guidelines at the tolls and inter-state borders. Therefore, the state governments should notify nodal agency or persons who shall have the authority to issue the permits to the exempted industries.

8. Seed licenses

Seed companies whose seed license has just expired or about to expire are unable to renew their licenses due to lockdown. In such cases, FICCI has requested that all seed licenses which are to expire in March 2020 or later, be automatically extended. This will facilitate the unhindered supply of seeds for this Kharif season.

9. Concerns related to irrigation equipments

In the context of the forthcoming Kharif crop, farmers will require the deployment and maintenance of irrigation systems. States like Uttar Pradesh, Bihar and Andhra Pradesh have clearly stated that irrigation equipment would be covered in the list of essential items. However, there is no guideline from the Centre on including irrigation equipments in essential list. Due to this, companies are not able to start operations and provide equipment in these states. The equipment stocked in warehouses will not be adequate to meet the demand. Therefore, guidelines from the Centre are important.

10. Concerns related to farm machinery

Addendum issued on April 3, 2020 by Centre government, does mention about relaxation in farm machinery. However, tractors which does not fall in the definition of farm machinery, are not mentioned specifically, which is causing problem at the state level. Companies are getting continuous requirement from farmers to purchase tractors since it is a sowing and land preparation time for Kharif season, but they are unable to meet demand due to ambiguity in circular and hindrance by local authorities.
11. Reschedule crop loans and investment loans

Loans taken on Kisan Credit Card (KCC) as well as investment loans taken by small farmers may be rescheduled and no interest should be charged for six months.

12. Cold chain

Impact on cold chain units: The cold chain industry runs on the backbone of fuel and power. The cold chain units are under severe distress and fear of disconnection of electricity supply, due to delay in payment or inability to pay electric bills. If the electricity supply of the cold storage unit is disconnected, that would lead to a national loss of a few thousand tonnes of food material. Moreover, if food items get rotten, there would be a widespread issue of hygiene and smell.

Impact on potato cold stores: Potato harvest is due in this season and cold stores are busy buying potato for storage. Shortage of labour and restriction on truck movement will result in low capacity utilisation, default on bank loans and wastage of potato on the field with losses to farmers. This may lead to an increase in the price of potatoes also in the coming three to four months.

Suggestions in this regard
The electricity rate of cold storage units to be matched with the agricultural tariff of the state. The rate of electricity on national power exchange is Rs. 1.90 while the cold storage units are being charged ranging from Rs. 6.50 to Rs. 8.50. It is requested that during this time of distress, electricity unit rates for cold stores be decreased. It is pertinent to mention, that Maharashtra and Haryana are already charging Agriculture Tariff from the cold storage units.

Potato harvesting and associated logistics should be specifically exempted from the lockdown restrictions. Cold stores should be allowed to engage labour and trucks to move produce from the field to stores. Cold stores should be given power subsidy for six months by Central government to compensate for lower capacity utilisation.

13. Relief measures for poultry sector

Today, the Indian poultry sector employees more than 10 lakh poultry farmers and provides Rs. 1.2 lakh crore to the Indian GDP directly. Poultry is also giving direct benefit to more than one crore maize and soya farmers and provides direct and indirect employment to more than 5 crore citizens of the country engaged in poultry production, trade, feed, agriculture crops, logistics, poultry-based products, exports, among others.

The recent outbreak of COVID- 19 has diminished the demand for poultry products, which is immensely impacting the poultry industry. Despite the fact, that there is no scientific evidence to show that coronavirus spreads through eating chicken, mutton and seafood, the situation is not improving.

Impact on maize and soybean farmers: In the absence of demand for poultry products, maize and soybean farmers are also suffering. As a result, the prices of maize have dropped from Rs.25 to Rs.15 per kg in the last few days.

Impact on poultry industry: Prices of eggs have now decreased to Rs.2 per egg at the farm-gate. Every poultry farmer is suffering an average loss of Rs.130 per bird. Due to such a scenario, poultry farmers have even started destroying and culling their produce, which needs immediate attention.

As per industry estimates, the Current 2.5 months loss of poultry industry (broiler farmers & layer farmers, integration companies and breeding companies) beginning from February 1 to April 15, 2020 until lockdown opens is of Rs 22,500 crore.

14. Recommendations for shrimp industry

India is the 2nd largest shrimp producer in the world and is the largest employer of women in the segment. The farmers are holding a stock of about USD 1 billion – 1.5 billion primarily for exports (Total shrimp exports are Rs 30,000 crore approximately). Major shrimp producing states are Andhra Pradesh, Tamil Nadu, Kerala and Gujarat. Shrimp is an extremely perishable commodity and if not procured within time, deteriorates very rapidly.

Interventions required

The stock has to be harvested daily and sold in the domestic market for the next 30 – 45 – 60 days as exports have stopped. Therefore, such farmers should be linked to buyers through an e-commerce model. Online perishables retailers should be incentivised to extend their helping hand.

Facilitation by government for movement of shrimp produces to domestic market by allowing reefers. Reefer trucks should be allowed to move the product for distribution to retail market or by online for home delivery.

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