Inputmarketing

Farm Inputs & Management
Presented by-
Neethish Varghese(1214)
Pankaj Agarwal(1215)
Shashank(1218)
Yogesh Singh Rana(1224)

Agricultural (Input & Output) Marketing
Key Inputs
seed fertilizer Pesticide
Farm Power
Machinery
Credit &
wage Rate

Farm Inputs
Seeds
O Any part of the crop from which a new crop will grow.(Agronomically)
O Seed is a fertilized ovule.(Botanically)
O Seed quality is estimated to account for 20-25% of productivity.
O World seed market is about 2,20,000 crore rs.
O Indian seed market size is about 9,000 crore rs.
O The seed replacement rate in most of the crops is very low, with the
exception of cotton and some other vegetables

SEED
GENERATIONS
NUCLEUS SEED BREEDER SEED
FOUNDATION
SEED
CERTIFIED
SEED
Company turnover (In Million US$)
Indian Seed Industry
Total Seed Industry is worth about 8000 9000 crores.
Private sector accounts for 70% turnover in seed.
Almost 1/3 companies have a global technology/financial partner.
Private seed companies are spending 10 12% of their turnover in
research and development (R&D).
R&D budget of medium sized companies is growing @ 20% per annum..
At present the number of seed companies engaged in seed production or
seed trade is about 500 number.

Key Players in Indian Market
Company Holding structure Turnover (Crore) focus
Mahyco Monsanto 1000 All crops
HLL Unilever 700 All crops
Proagro Aventis 600 All crops
Ankur 400 Cotton, vegetables
Namdhari 500 vegetables
Advanta Advanta & ITC 300 sunflower
Syngenta Syngenta 350 Corn, cotton, millet
Indo-American Family 300 Sunflower, cotton
Mahendra Hicks Mouse 300 Millets, cotton
Spic-phi POC 250 Corn, millets
Cargill Monsanto 200 Corn, sunflower
EID Parry Family, Monsanto 10 Sunflower, cotton
Nath Nath Group - Cotton,
millets,corn
Total 9000
SOURCE: Seed division of DAC
Indian Company & its
Turnover
Seed Replacement Rate
Seed export
O Currently, seed export from India is very minuscule at around 500 crore rs.
accounting for just 1% of total global seed export.
horticultural
crops, 31%
maize,
15%
herbage
crops, 12%
beet, 8%
potato,
11%
wheat, 2%
other agri
crops, 21%
Source: seed
association of
India
Protection of Plant Varieties and
Farmers Rights Authority (PPV&FR)

O Enacted in 2001.
O Varieties of crops can have proprietary or Intellectual Property Rights
(IPRs) on them through either patent or plant variety protection or a
combination of both.
O The PPV&FR Authority registers plant varieties to protect plant
breeders rights, thereby stimulating R&D investment in development
of new plant varieties.
New Policy on Seed Development
(NPSD)
O New Policy on Seed Development (NPSD), 1988 was formulated with a
view to provide the best planting material available abroad to Indian
farmers.
O import of seeds under various categories such as coarse cereals, pulses,
seeds of vegetables, flowers, etc. to improve agricultural production and
productivity.
O The policy permits an initial import of small quantity of cereals, oilseeds,
pulses, etc. for in-house trial by importer and multi location testing under
All India Coordinated Trials of ICAR.
OECD Seed Scheme
O The objective of the Organization for Economic Cooperation and
Development (OECD) Seeds Scheme is to encourage use of seeds of
consistently high quality in participating countries.
O Indias participation in the OECD Seed Scheme was accepted by the
OECD in 2008 in respect of five seed schemes viz.
o (i) Grasses and Legumes
o (ii) Cereals
o (iii) Crucifers and other oil and fiber species,
o (iv) Maize and Sorghum and
o (v) Vegetables.
Production and consumption of Seeds
in India
year Production of
Breeder seeds
(in Thousand
Quintals)
Production of
Foundation
seeds
(in lakh Qtls)
Distribution of
certified
/quality seeds
(in Lakh Qtls)
1991-92 3.75 34.9 57.5
1995-99 4.76 43.36 69.9
2001-01 5.91 42.69 86.27
2005-06 7.4 68.64 126.75
2009-10 10.5 105 257.11
2010-11 17.53 119.21 277.3
Source: Directorate of economics and statistics, DAC Agricultural (Input & Output) Marketing
All India Position of Requirement &
Availability of Quality Seed(2010)
Year Requirements
(In Lakh
Quintal)
Availability
(In Lakh
Quintal)
Surplus
(In Lakh
Quintal)

2006-07 128.76 148.18 +19.42
2007-08 180.74 194.31 +13.57
2008-09 207.28 250.35 +43.07
2009-10 249.12 279.72 +30.60
1010-11 290.76 321.36 +30.60
2011-12 330.41 353.62 +23.21
Source; DAC, Seeds Division
National Seeds Policy, 2002
O The policy aims at enhancing food production targets achievable by
enhancing, the Seed Replacement Rates (SRR).
O The policy aims at creating an enabling climate for growth of a competitive
and vibrant seed industry, encouraging import of useful germplasm and
boosting exports.
O The thrust areas are varietal development and plant variety protection, seed
production,quality assurance, creation of infrastructure for seeds,
transgenics, import of planting material,export of seeds and promotion of
domestic seed industry.
The Seeds Bill, 2004
O aims to regulate the quality of seeds and planting material of all
agricultural, horticultural and plantation crops to ensure availability of
true to type seeds to Indian farmers:
curb the sale of spurious,
poor quality seeds ;
protect the rights of farmers;
increase private participation in seed production
distribution and seed testing;
liberalize import of seeds and planting materials
CHALLENGES
O There is a mismatch between the seed multiplication ratio from breeder
seed to foundation seed and from foundation seed to certified seed.
O Comprehensive and authentic databases on seed production and trade
need to be built up.
O The seed chain and the norms for quality control to be followed without
any compromises or shortcuts.
O For horticulture crops which have a long gestation period , it is imperative
to ensure that only such varieties are imported that are suited to Indian
conditions.

THE WAY FORWARD
O A genetically diverse portfolio of improved crop varieties needed.
O Timely delivery to farmers of high-yielding varieties requires big
improvements in the system that connects plant germplasm collections, plant
breeding and seed delivery.
O Improving policies and legislation for variety development and release as
well as seed supply.
O Enactment of flexible variety release legislation.
O Strengthening capacity by creating a new generation of skilled practitioners
to support enhanced breeding.
O Working with farmers to explore the ways in which crops and varieties
contribute to successful intensification
O Revitalizing the public sector and expanding its role in developing new crop
varieties.
Fertilizers

O macronutrients (6): nitrogen, phosphorus, potassium, sulphur, calcium
magnesium -,
present in plant tissue in quantities from 0.15% to 6.0% of dry
matter
O micronutrients (8) : Molybdenum, Nickel, Copper, Zinc, Manganese, Iron,
Boron, chlorine -
present in plant tissue on the order of parts per million (ppm),
ranging from 0.15 to 400 ppm DM, or less than 0.04% DM
O All nutrients fulfill specific functions in plants and cannot replace each other
All of them are equally important, regardless of the amount required
physiologically
Lack of any single nutrient will limit crop growth even if all the other
nutrients are fully available
supply of all nutrients is essential to produce high yields of good quality
Global consumption of fertilizer

The global fertilizer market
2010 US$ 130 billion ; Volume 163 mt
2015 US$ 172 billion ; Volume: 183.5 million tons
Indian fertilizer market
2010 US$ 24 billion ;Volume 28 mt
O Source: Coramandel, 2011

Global NPK market
Consumption growing at 2.0 - 2.2%.
World NPK increased by 11% in 2009 and
sales by 13% mainly due to K sales
India and China account for 40% of global
consumption
Regionally concentrated availability:
N in Middle East, USA & FSU
P in North/West Africa, USA & Jordan
K in Canada, FSU & Middle East
Source: Coramandel, 2011

Global demand-
supply situation for important fertilizers
Globally, the fertilizer
demand-supply
scenario is
comfortable with
supply exceeding
demand.

Indian situation is
different: by 2015,
India is expected to
face a demand-supply
deficit of 8-9-mt of
urea

Indian industry can
setup plants abroad to
meet demand
Consumption, Production & Imports of Fertilizers
India: fertilizer use and crop production
O Use of fertilizer started in India with initiation of the planning process in
early fifties
O Food grain production increased from 74mt in 1966-67 to 241.56mt in 2010-
11
O India is the 2
nd
largest producer of Nitrogenous fertilizer and 3
rd
in
production of phosphate fertilizer
O Potash is totally imported
O India is 2
nd
to China in Nitrogen and Phosphorous consumption
O Fertiliser consumption in India is 16% ofglobal consumption
O Consumption chemical fertilizers during 2010-11 is 28.2 mt (16.6 mt N ,8.1
mt P & 3.5 mtK)
O Average consumption increase from 95 kg/ha in 2004-05 to 144.6kg/ha in
2010-11

Contd.
0
20
40
60
80
100
120
140
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9
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-
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0
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-
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2
2
0
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-
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2
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0
7
-
0
8

(
P
)
NPK(Kg/ha)
9%
5%
3%
4%
2.00%
5%
Rice 37%
Wheat 24%
Food Grains 8%
Pulses 3%
Oil Seeds 9%
Sugarcane 5%
Cotton 3%
Vegetables 4%
Fruits 2%
Others 5%
Rice
37%
Wheat
24%
Food Grains
8%
Pulses
3%
Oil Seeds
9%
Sugarcane
5%
Cotton
3%
Vegetables
4%
Fruits
2%
Others
5% Rice
Wheat
Food Grains
Pulses
Oil Seeds
Sugarcane
Cotton
Vegetables
Fruits
Others
0
3
6
9
12
1950 1960 1970 1980 1990 2000 2010
Year
N
,

P

a
n
d

K

(
M
t
)
0
50
100
150
200
250
F
o
o
d

g
r
a
i
n

(
M
t
)
N
P
K
Food grain
Urea consumption increased from
1.1 MT to 28 MT during 1966-2010
Rice and wheat account for more
than 60 percent of consumption
> 1/3 for rice
Nutrient Demand growth rate:
N : 3%
P : 6%
K : 5%
Declining NUE in India
Fertilizer (Control) Order, 1985:
administered by Deptt. of Agriculture &Cooperation, Govt. of India
issued under the Essential Commodities Act, 1955.
Customized fertilizer of 36 grades and 9 fortified fertilizer have been included
5 bio fertilizer( rhizobium, azotobacter , azospirilllum , phosphate solubilizing bacteria ,
mychorrhizae) and 3 organic fertilizer(castor de-oiled cake , city waste and vermi-compost)
have been included
defines:
what substances qualify for use as fertilizers in the soil
product-wise specifications
methods for sampling and analysis of fertilizers
procedure for obtaining license/registration as manufacture/dealer in
fertilizers and
price fixation: fix maximum sale prices (MRP) of fertilizers uniform across
the country to ensure fair access and price to farmers
Urea is the only fertilizer which is under price, distribution & movement control
through (FCO) & Fertilizer Movement (Control) Order; Production and subsidy
disbursement is regulated under Retention Price Scheme (RPS) administered by
Fertilizer Industry Coordination Committee (FICC).
Fertilizer Policy
Consequences of subsidy policy declining yield response
Reasons for declining response
Inadequate and imbalanced fertilizer use
Increasing multi-nutrient deficiency
Lack of farmers awareness about balanced
plant nutrition
Lack of varietal breakthrough
Poor crop management
Declining organic matter in the soil
Source: IFFCO/Salhotra, 2011
Impact of fertilizer subsidy
Nutrient Based Subsidy (2010)
NBS subsidy rates 2010-11 on nutrients and
products
NBS subsidy rates 2010-11 on freight
Advantages of NBS for industry
PESTICIDES
O Pesticides are substances or mixture of substances intended for preventing,
destroying, repelling or mitigating any pest.
Pesticides are of major attention in India because
Increasing demand for food grains.
Decreasing per capita land available for agriculture.
Low crop yield in India.
Estimated crop loss in India due to non usage of agro chemicals amount to Rs
90,000 cr p.a. (28% of yield).
Per hectare consumption of pesticide in India is 381gm which is low as
compared to the world average of 500 gm

INTRODUCTION
72
61
43
40
42
55
0
10
20
30
40
50
60
70
80
Consumption of pesticides in
India (Thousand tonnes)
Source: Directorate
of Economics and
Statistics, DAC
During Financial Year 2006 , production of pesticides dropped mainly due
to lower intake in cotton crop which typically consumes the highest
proportion of pesticides.
Pesticide Industry overview
It is mainly consolidated to top 9
companies accounting for over 80%
of market
Buyers have little choice but to buy
the products from the same
suppliers (eg. Monsanto engineers
seeds that are tolerant only to its
own herbicides to bridge its
pesticides (crop protection) and
seed businesses, increasing
customers dependence on
its products.
Market distribution of Agrochemicals in
India by product category(% of total)
With increasing penetration of BT cotton ,usage of insecticides has
witnessed a decline in the recent past. Its share in the total crop
protection chemicals has reduced from 69% in 2004 to 55% in 2009.
2004 2009

Crop wise pesticides consumption
(%of total)
paddy
28%
cotton
20%
veget
ables
14%
fruit
6%
wheat
6%
pulse
s
5%
oilsee
ds
5%
others
16%
cotton
33%
paddy
24%
fruits
&vege
tables
21%
wheat
8%
pulses
&oilse
eds
8%
others
6%
2005
2009
Introduction of Bt cotton, pesticide usage on cotton decreased
from 33% to 20% in 2009,while in paddy increased popularity
of hybrid varieties of rice lead to increased usage of
pesticides.
Computerized Online Pesticide Registration System
A computerized online pesticide registration system was introduced in
July 2008 in the Secretariat of central Insecticides Board and
Registration Committee (CIB&RC), Faridabad.
The system enables pesticide companies to apply for registration of
pesticide products and receive any query about deficiencies online.
Accreditation of Pesticide Analysis
Laboratories
To ensure greater quality assurance in the pesticide analysis by notified
laboratories under the Insecticides Act,1968,the Central Insecticides
Laboratory and both Regional Pesticides Testing Laboratories have
obtained accreditation from the National Accreditation Board for testing
and Calibration Laboratories (NABL).
Major policy advancement & further roadmap
Intensive pest Surveillance and Management
In response to major pest attacks in recent years ,some states have
implemented intensive pest surveillance and management systems for
major crops vulnerable to pests and diseases under Rashtriya Krishi
Yojana (RKVY),e.g.,Maharashtra in 2009 (for soyabean and pulses) and
Orissa in 2010 (for Rice).
Contd.
Capacity Building - National Institute of Plant
Health Management

Capacity Buiding is an important area in Plant protection. The
National Plant Protection training Institute (NPPTI),Hyderabad
was converted in to a society in 2008 to give it more autonomy for
human resource development in bio-security.
The institute, renamed as the National Institute of Plant Health
Management(NIPHM),is headed by a Director General.
Contd.
Online plant quarantine services have been introduced in January 2011 to
enable exporters to apply for a phytosanitary certificate and importers to apply
for import permit and release order online. Of the plant quarantine work, 93 %
now being conducted online.

Round the clock (24x7) plant quarantine services have been introduced at
Chennai, Mumbai and New Delhi.

Phytosanitary certificates with standard format and enhanced security features
have been introduced to prevent fraud.

Five major Regional Plant Quarantine Stations (RPQS) located at Amritsar,
Chennai, Kolkata, Mumbai and New Delhi have secured ISO 9001:2000
certification, an international standard for an organizations quality
management system.
Upgrading Plant Quarantine services

Pesticides regulations
O The Insecticides Act,1968
O Prevention of Food Adulteration Act,1954
O Water (Prevention & Control of Pollution) Act,1974
O Air (Prevention & control of Pollution) Act,1981
O Hazardous wastes (Management & Handling) Rules,1989
O The Environment protection Act,1986
O Bureau of Indian Standards Act
Farm Mechanization
Why Farm Mechanization

O Labour is available at a higher cost per hectare and this would
increase the demand for mechanization.
O India is a growing economy and to support a growing
population we would require not only efficient but machinery
that would increase the yield of food grains and commercial
crops.

O Mechanical power has replaced bullock power on Indian
farms..

Evolution of Indian Agricultural
Machinery
Processes Traditional Practice Current Practice
Land Development
Tillage
Seedbed preparation
Plough, Blade
Harrow
Tractors
Mould Board Plough
Power Tiller
Sowing & Planting Dibblers Seed Drill
Zero Till Seed-cum-Fertilizer
Drill
Weeding Hand Hoes, Animal
driven Weeding
Tools
Power Weeder
Plant Protection Dusters, Hand
Sprayers
Blower
Power Spray
Harvesting & Threshing Sickle, Animal
Trampling
Self Propelled Harvesters
Tractor mounted
Harvesters
Threshers
ADVANTAGES

Increase in crop intensity and yield thus
ensuring better returns to the farmer
Reduction of weather risk and risk of non-
availability of labor thus minimizing post
harvest wastages
Improved working conditions and enhanced
safety for the farmer
Conversion of uncultivable land to agricultural
land through advanced tilling technologies
Shifting land used for feed and fodder
cultivation for draught animals towards food
grain production
Increased rural employment.
ISSUES AND CHALLENGES

Highly diverse farm size & soil types:
resulting in the need for customized farm
machinery and equipment.
Skewed and seasonal usage resulting in low
economic viability
Cattle population: Increased mechanisation
results in surplus draught cattle and their
upkeep is a concern for the farmers.
Extension service: Education and training for
efficient usage of farm equipment is required
to be imparted along with knowledge about
selection of appropriate machinery.

Economic Advantage of Mechanization(%)
Increase in Productivity 12-34
Saving in seeds 20
Saving in Fertilizers 15-20
Enhancement in cropping intensity 5-22
Increase in gross income of farmer 29-4
Source: report on Agricultural Implements and Machinery, GOI
CUSTOM
HIRING
Less Farm Holdings
High Cost of machineries
Scattered Farms
Poor purchasing power of
Farmers
Custom Hiring, allows a farmer to gain short- term control of a combine
without investing a large amount of capital.
Advantages:
No long term capital investment.
No repair costs.
No cost for operating and maintaining the machine.
Disadvantages:
Unavailability of competent operator nearby.
49
Market size: Approximately 370 000 units annually
Market growth: 4-5% per annum
Price sensitive market; sales dependant on Government subsidy; no subsidy on
tractors above 30 HP
Domestic sector growing due to an increase in the irrigated area, Government policy
related to export which decides crop switching by farmers
Smaller tractors are very popular (35-40 HP); this is the fastest growing segment
one third are for non agricultural uses i.e. for transport and haulage
Low Penetration Level: 17 for every 1000Hectares
Major brands:

Market - Tractors
Source: Italian Trade Commission, 2010
50
0
50000
100000
150000
200000
250000
300000
1
9
8
2
-
8
3
1
9
8
4
-
8
5
1
9
8
6
-
8
7
1
9
8
8
-
8
9
1
9
9
0
-
9
1
1
9
9
2
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3
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-
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5
year
t
r
a
c
t
o
r
s
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
20000
p
o
w
e
r

t
i
l
l
e
r
s
tractors power tillers
Machinery
demand driven by development,
labour scarcity, infrastructure, services
improved equipment tools contribute to
savings in seeds (20%), fertilizers
(20%), time (20-30%) and labour (20-
30%)
steady growth of manually operated
tools: drills, cutters, sprayers,
threshers
growth in animal operated equipment:
ploughs, disc harrows, drills, puddlers
steady growth in mechanical and
electrical power operated equipment:
pump sets,sprayers, ploughs/drills,
threshers, combines

India largest manufacturer of tractors
(>60% < 60hp)
Annual sale of tractors: 2.5 lakh
IRRIGATION
O Irrigation potential is about 140 mha.
O 58.4mha from major and medium irrigation sources, and 81.5
mha from minor irrigation sources.
O Ground water provides 70% of irrigation water.
Challenges:
O Persistent gap between the assessed ultimate irrigation potential
and actual potential that has been put to use.
O Inefficient water use in irrigation is leading to environmental
degradation via waterlogging.
Efficiency in systems needs to be upgraded from present level.
Methods of Micro-irrigation should be taken in use for better
utilisation of water.
It include Drip and Sprinkler irrigation system.
Market Share of major Irrigation
Companies in India
Jain Irrigation
55%
Netafim
25%
Nagarjuna
Group
6%
Parikshit
Industries
5%
Premier
Irrigation
3%
EPC
3%
others
3%
Jain Irrigation and Netafim constitute 80% of market share
The size of the market for micro
irrigation systems, is around Rs
3,000 crore in India.
(http://articles.economictimes.indiatimes.com/2011-07-
31/news/29835726_1_oil-palm-sprinkler-irrigation-agri)

Jain Irrigation: 1650 crores
Netafim: 750 crores

Source: FICCI(Federation of Indian Chambers and Commerce and
Industry)
Presentation on Agricultural Wages and
Labour
Introduction
O India level, approximately 60 percent of the rural labour force
and 45 percent of the urban labour force is self-employed.
O Rural casual labour constitutes the single largest segment of
the total workforce in India. Among rural casual labourers,
agricultural labourers occupy a predominant position.
O The rural agricultural wage rate, hence, is considered as one
of the most robust indicators of economic well-being, not only
of agricultural labourers, but also of the overall rural
population.
Agriculture & Labour
O Agriculture is a labour intensive activity.
O Cost of cultivation data shows that labor accounts for more than 40
percent of the total variable cost of production
O Raising the wage levels of casual workers both in agriculture and non-
agriculture sectors needs adequate policy attention. In this regard, stricter
implementation of the Minimum Wages Act, 1948 and targeted
employment generation programmes are important.
O Agricultural wages have been traditionally low due to low productivity,
large disguised unemployment in agriculture due to lack of sufficient
employment opportunities elsewhere.
O In recent years there is a perceptible change in this trend due to rapid
economic growth and adoption of policies for employment generation
including promotion of self employment opportunities.
MGNREGA
O MGNREGA, enacted on September, 2005
O Provides for the enhancement of livelihood security of the households
in rural areas of the country by providing at least one hundred days of
guaranteed wage employment.
O It has prevented distress migration and helped in empowerment of
women.
O It has also led to a substantial increases in the wage rates of agricultural
and non-agricultural laborers, reduced the availability of labour for
agricultural operations and increased the cost of cultivation.
O Major policy measures influencing the wage increase are MNREGA
and Minimum Wages Act implemented by the government.
AGRICULTURAL CREDIT
According to Samuelson
Credit is the use of someone elses funds in exchange for a promise to
pay with or without interest at a later date
Farm Credit or Agriculture Credit is the count of loan or Credit
obtained form any source for the promotion & development of
Agriculture
What is Credit?

Problems of Agriculture Credit

Small Units
Damage to crops & Land
Low & Uncertain yields & incomes
Lack of Credit worthiness & Security
Small & large cultivators
Unproductive uses
High Cost
Limited flow of Capital to Small Farmers
Delayed disbursement of Credit
Measures to Solve those
Problems

Agriculture Credit Institutions
Agriculture Credit Advisory Committee (1972)
Special Schemes (1977 extend credit amount)
Recovery of Loan
Finance in kind & supervised
Pass Book System
Sources of institutional Agricultural
credit percentage
39%
8%
53%
0.2%
2000-01
co-operative
bank
RRBs
Commercial
banks
other agencies
16%
10%
74%
0%
2010-11
co-operative
bank
RRBs
Commercial
banks
other agencies
ROLE OF NABARD IN CREDIT
NABARD Would facilitate the formation and financing of group of tenant
farmer by organizing them into Tenant farmer group.
The objective of the scheme is to provide crop loan through institutional
agencies to tenant farmers, oral lessees and share croppers, who are not
being extended credit support.
NABARD would extend refinance support to RRBs and state cooperative
Bank/District central cooperative Bank to the extent of 100% of the loan
provided by the Bank to the TFGs.
NABARD is facilitating implementation of SHG-bank linkage programme
through commercial NGOs, state government departments, farmers club,
individual rural volunteers, etc. since 1992 onwards.

Role of Vaidyanathan committee
O On the basis of recommendations made by the Vaidyanathan committee
task force , the government of India had approved a Revival package for
short term Co operative credit structure (STCCS) aimed at making it a
well managed and vibrant structure to rural India.
O Revival package(13,597crore) seeks namely to (1) provide financial
assistance to bring the system to an acceptable level of health.(2)
introduce legal and institutional reforms necessary for their democratic,
self-reliant and efficient functioning, (3) Take measure to improve the
quality of management as an integrated package.
Agricultural Debt waiver and Debt relief
scheme (ADWDRS) 2008
O The main aimed of ADWDRS at de-clogging the lines of credit that were choked
due to the debt burden on the farmers and to entitle these farmers for fresh credit.
O All Agricultural loans disbursed by public sector Banks, private sector bank ,
cooperative bank, local area bank, and regional rural banks between 1
st
April ,1997
to 31 March, 2007 to farmers overdue as on 31 December 2007 and remaining
unpaid up to 28 february,2008 were eligible for Debt waiver Debt relief.
O For marginal farmers there was a complete waiver of loans that were over due on
31,December 2007 and which remained unpaid until 29 February ,2008.
O In respect of other farmer, there was a provision for One time settlement (OTS)
scheme for all loans that were over due on December 31, 2007 and which
remained unpaid until February 29 ,2008
KISAN CREDIT CARD
O One of the major challenges in the sector has been ensuring the provision
of timely and adequate credit to the farmers.
O An innovative strategy conceived in 1991 by the GOV of India created the
kisan credit cards(KCC) through which farmers could avail short term loan
for crops from Bank.
O The scheme was initiated in consultation with the Reserve Bank of India ,
NABARD, and by the end of October, 2011 10.78 crore KCC were issued .
O It is essentially a type of revolving cash credit facility with withdrawals and
repayment to meet the production credit needs, cultivation expenses and
contingency expenses of the farmers.
CROP INSURANCE
Objectives of Crop Insurance
O To provide insurance coverage and financial support to the farmers in the
event of prevented sowing & failure of any of the notified crop as a result of
natural calamities, pests & diseases.

O To encourage the farmers to adopt progressive farming practices, high value
in-puts and higher technology in Agriculture.

O To help stabilize farm incomes, particularly in disaster years.

Existing Crop Insurance Schemes

I. NAIS: yield based; non-actuarial premium except horticultural crops /
annual commercial crops; underwriting of losses by Central & State
Govt. on 50:50 ratio
II. WBCIS: Weather-based Crop Insurance Scheme is intended to provide
insurance protection to the farmers against adverse weather incidence.
III. CPIS: plant based; actuarial premium
IV. MNAIS: yield based; actuarial premium with premium subsidy shared
equally by Central & State Govt.
NATIONAL AGRICULTURAL INSURANCE
SCHEME (NAIS)
O For improving the scope and content of CCIS a broad based NAIS was
introduced from Rabi 1999-2000.
O NAIS provides for greater coverage of farmers, crops and risk commitment.
O Premia-structure has been rationalized and the scheme is required to operate at
smaller unit area of insurance.
O Subsidy to Small and Marginal farmers.
O It is presently being implemented by 25 States & 2 Union Territories

MNAIS- Present Status
O Implemented in 34 districts covering 22 States during Rabi 2010-11 season

O The scheme would be on actuarial regime in which insurance company will
receive premium on commercial basis and will be responsible for all claims

O GOI & State Govts. will provide premium subsidy upto a max. of 75% at
different slabs of actuarial premium to make the scheme affordable for
farmers

O The coverage in Pilot MNAIS is expected to 25% of total farmers of 50
districts.
Challenges
share in total credit for cultivator
household was only 61 percent in
2002. This shows that the cultivator
households are not able to come out of
the clutches of money lenders and
other non-institutional sources.
It is also reported that only 27 percent
of the total number of cultivator
households received credit from
formal sources while 22 percent
dependent on informal sources. The
remaining households, comprising
mainly small and marginal farmers,
had no credit outstanding.
Comprehensive new measures
are needed in terms of innovative
products and services to increase
access to institutional credit.
Complex documentation
processes and high transaction
cost in taking loans require
attention.
It is highly desirable to provide a
KCC to all farmers in the country
and to raise credit the limit, from
time to time as needed.
The Way Forward

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