The Hindu Business Line : `Contract farming will benefit small farmers'

EXPLAINING the Integrated Crop Development Project (ICDP), as it will evolve in the proposed new agriculture policy and the pivotal role of the primary agricultural cooperative societies (PACS) in the country, Mr Hukumdeo Narayan Yadav, Union minister of State for Agriculture, has said that if industries are able to ensure a high value addition chain, it can help the Indian farmer raise his income and come out of the poverty trap.

Calling for sustainable agriculture as the way forward, he said productivity, quality and the need to protect the traditional system of farming, with stress on upgradation and modification of the traditional system would be the key elements in the new farm policy.

Explaining the delay in announcing the policy, Mr Yadav said, "we are proceeding cautiously in collaboration with the States, in our search for this lab-to-land approach''.

He said the Government was going slow on the proposed new agricultural policy, as it wanted a widespread national debate on the various steps being proposed for empowerment of Indian farmers, particularly the small and marginal farmers. The policy being prepared, would be for all time and remain the guiding force, irrespective of any change in political leadership, he clarified. He also sought the active cooperation of the States in carving out the new farm policy.

Participating in an interactive session organised by the Calcutta Chamber of Commerce, the Minister said industries would in turn get agricultural commodities of high quality from the farmers. Advocating contract farming as an ideal arrangement effective processing of agri-products and adding value agri-horticultural produce, he said an industry-agriculture partnership might create a win-win situation for both.

Contract farming is a system in which agro-processing or trading units enter into a contract with farmers to produce a specified quantity of any agricultural commodity at pre-determined prices. This, he felt, not only would reduce the risk of non-availability of quality raw materials for the company, but also provide an assured market and price for the farmer, protecting him from fluctuating markets and prices.

Since small farmers in India were generally starved of capital, contract farming could help them with quality inputs, technical guidance and management skills, Mr Yadav pointed out. He said this arrangement was different from corporate farming, as the land rights of contract farmers would remain unaffected and fully protected. He urged industry to devise ways and means to promote contract farming and to create other arrangements in which marketing support can be provided to farmers.

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`Contract farming will benefit small farmers'