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Ch. Prashanth Reddy

As in the case of tomatoes, PepsiCo wants to go in for contract farming of basmati to increase yields, reduce overall costs and make the product internationally competitive.

HYDERABAD, Feb. 5

PEPSICO India Holdings Pvt Ltd intends to bring 10,000 acres of basmati crop area in Punjab, Western Uttar Pradesh and Haryana under contract farming this year to achieve its target of exporting over 12,000 tonnes of basmati rice in future.

According to the PepsiCo Executive Director-Exports and External Affairs, Mr Abhiram Seth, the company is planning to export nearly 9,000 tonnes of basmati rice by next year as against 3,000 tonnes this year. Hence, as in the case of tomatoes, PepsiCo wants to go in for contract farming for increasing yields, reducing overall costs and making the product internationally competitive.

Mr Seth said the whole idea is to provide a more stable environment to basmati farmers who are often affected by price fluctuations. In contract farming, a farmer will harvest and deliver to the contractor, a quantum of produce, based upon anticipated yield and contracted acreage at a pre agreed price.

Apart from basmati, Mr Seth told Business Line, PepsiCo was also focussing on introducing processing varieties of oranges. The company had entered into a tie-up with the Punjab Agro Export Corporation in this regard. At present, the Punjab Government was importing one-year old plants of these varieties.

For the development of the necessary litmus selections, the company had established quarantine facilities that would be inaugurated on February 10.

The quarantine stocks would be subsequently grown on 8 demonstration sites. In the first phase of the project, it was planned to supply 2 lakh plants a year to the farmers.

Mr Seth said the project was estimated to cost about Rs 4 crore.

The bulk of the investment would be made by the Punjab Agro Export Corporation. In future, PepsiCo would be investing on creation of processing facilities also.

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PepsiCo mulls contract farming of basmati rice

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