Only agriculture cannot sustain the bulk of country’s rural population. Then, why there is a sluggish pace in “structural change” in the Indian rural economy? When we know that value addition activities have ample potential to absorb surplus labour force, it would be a game changing move. So, let’s see the importance and challenges of agro processing industries in India.
Understanding Role, Importance, and challenges of agro processing industries in India
Agro processing industries in India could be a better employment substitute for educated yet unemployed rural youth within their habitat. And, In the long run, it will help to strengthen the industrial base in the rural landscape. Most importantly, this might arrest the ongoing plight of agrarian community.
Agro processing industries an opportunity in rural India
Here are some points to justify the importance of agro processing industries in the rural landscape.
1.Surplus educated rural youth need quality jobs
The numbers of educated youths are growing rapidly. At the same time, the pressure to employ them quickly is unabated rising.
As per the government data, annually, more than 10 million students are crossing the degree level education or becoming graduate. Out of this, 70 percent belong to rural areas. You cannot left them on the mercy of unprofitable agriculture.
Obviously, these well-educated youths need respected yet productive jobs so that they could live a frugal life. Today, the state of industrial base in the rural areas is negligible. Rural-urban migration has already crossed the range of tolerance. In this situation, we have to focus on “in situ” developmental strategy.
2.Great comparative advantage in rural areas for agro processing industries
Rural areas have great comparative advantage over the urban centres. It is a well-known fact that there is no dearth of labour even skilled.
Secondly, low wage rates are conspicuous reality. All MNCs are focusing at rural India for potential market. This points out that there is an assured market. Also, no need to find out raw materials, it is at the doorstep.
Moreover, governments can offer great incentives to attract more players at the local level. Further, there is no need to prove that the rural areas have enormous yet promising industrial future and potential.
3.Agro processing industries in India may usher Inclusive growth
The backbone of agriculture has already broken by erratic monsoon and price crash of commodities. Hereby, economic participation of 70 percent population is utmost important. Rural food processing industries have huge potential in India.
Truly, agro-processing industries have huge potential to achieve twin goals. One, remunerative price for commodities as a raw materials.
Further, it will definitely prove as an insurance against price crash. And, second, it is capable to reap demographic dividend by absorbing surplus both skilled, as well as unskilled labour force.
4.Alternative job opportunities could empower the confidence of rural agrarian community
The major cause of suicide is stagnated income. And, we are aware about the causes of stagnated income. One, the low productivity and price crash are attributed to the falling income of farmers. Second, there is no hope due to lack of alternative to compensate loss.
Through suggested means, we could arrest both. There would be better remunerative price for commodities due to demand and value addition and second, better employment opportunities at the doorstep in the lean season. This could guard or act as a safety wall against vulnerability or fragility.
5.Agro processing industries can accelerate overall economic growth
In the last decade, we observed that agricultural growth is continuously falling behind of other sectors such as services and industry. This means that there is no growth for half of population of nation.
Still, Indian economy is the one of the fastest growing economies in the world. Then, would you let me know what would happen when the agriculture sector will lead the growth?
Surely, India will lead the entire world in terms of growth. Most importantly, it could be a better example for others as well.
6.Agro processing move could be base for future industrialization
Today, there is no base of industry in the rural areas. The industrial centres are rapidly mushrooming in the highly urbanized areas. Unlike to earlier period, urban centres are losing comparative advantage duo to higher factors costs.
Hereafter, rural landscape could be the better option out of compulsion or necessity. This initiative could foster it further. All these prove the importance of agro processing in India.
Challenges for agro processing industries in India
Though agro processing industries have great opportunities in the economic transformation and development of rural India, ever since subjugation, it has been eclipsed by numerous bottlenecks and challenges and waiting to unleash potential. Let’s see what type of challenges for agro processing in India have..
Here, I’m going to explain the major challenges for agro processing in India in detail. In short, right from the infrastructure to marketing, the pace of Indian agro industries are blocked by the following bottlenecks.
1.Infrastructural bottlenecks in rural India
Infrastructure development is really not good and it need to be improved. Load shedding in the rural areas looks permanent. Electricity generation, as well as consumption, is much lower compare to peers. Transportation facilities are also a cause of concern.
2.Quality of technical education for rural youth
Quality of education isn’t hidden thing. Quality technical yet workable education is prerequisite for this initiative. Almost 60 percent of students are pursuing non-technical education which highlights the non-serious attitude of both state and citizens. Emphasis should be more on technical, relevant education.
3.Question of investment in cash crunched regions
Investment is also a serious issue. The capital formation rate in the rural households is negligible. Pumping financial resources through government is only option. Though it is risky, but nothing more than farmers suicide.
4.Lack of political will power
In the beginning, government intervention is essential to provide some level playing field for infant plants against mushroomed mighty one. Once they get momentum, state can reduce its role. It is necessary due to MNCs penetration in the rural areas.
Though it is time taking process but looks good for all and there is no other option also.
Last words on agro processing industries in India
No doubt, agro-processing industries in the rural areas could definitely be a game changer. Although, initially, it looks like hypothetical or imaginary, it has great potential to alter the developmental contours in favour of deprived, vulnerable portion of nation.
Mere painkillers in the form of price rise and loan waiver schemes will only aggravate the ongoing situation. If we need long lasting solution, then we are option less except “Rural development with agro-processing industries in India.
Causes of farmers suicides in India
Opportunity cost and comparative advantage
Positive comparative and superlative
Financial literacy in rural India