Cerebral Shangrila

Saturday, May 27, 2006

Is Agriculture the next big thing ?

The next big thing could be an age old industry which just needs some revamp. If IT,BPO,Pharma are the "in thing" today, can Agriculture be the sunshine industry of tomorrow ? The Indian farmers are a neglected lot in general (except the free power news during the elecions) who are heavily dependent on the vicissitudes of the monsoon.

But now the multinationals are stepping in to bring private investment to make Agri the next big thing. International Herald Tribune looks at this trend and sounds quite bullish about the future.Jai Kisan !

"Multinational companies from Wal-Mart to Rothschild Group to PepsiCo are wagering that India could parlay its tropical climate and the latent energies of hundreds of millions of farm dwellers into a position as an agribusiness powerhouse, exporting fruits and vegetables, spices, flowers, wine, ice cream, poultry, shrimp, fish and even pasta."The vision is to link India's small farmers to global supply chains in agriculture, just as its software writers and call-center workers have been linked to other segments of the global economy. Farmers would move from staples like wheat to higher-value crops like okra and onions, Alphonso mangoes, spices, shrimp, Darjeeling tea, long-grain basmati rice, cashew nuts, milk and buffalo meat.
Big companies, foreign and domestic, would aggregate the crops harvested from scores of small farms, process them into value-added products like sausages or fruit purées, and get them to Western hypermarket customers through a "cold chain" of refrigerated trucks, ocean vessels and cargo planes.
Because land is the only thing most farmers possess, the companies probably will be prohibited from acquiring it. Executives say they will focus on working with farmers rather than replacing them.Global investors are pouring money into ventures to export Indian farm goods, or exploring ways to do so. The trend is fueled in part by the growth of a large Indian middle class, and companies interested in serving that market are betting that they can use their foothold in India to cater to the world.

Rajesh Srivastava, managing director in India of Rabobank, said lenders now regard the Indian farm sector as the next outsourcing story after information technology. "If IT is serious business today," he said, "agribusiness will be three times as serious five years from today."


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