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'Rural India can be agri powerhouse'
Experts say pvt sector and agriculture can together make rural economy a powerhouse, reports M Rajendran.
The private sector and agriculture, long seen as unconnected and sometimes conflicting interests, could work together to make India's rural economy a global agricultural powerhouse, experts said on Tuesday at the India Economic Summit, the first since corporate houses like Reliance and Bharti went into the retail business to bring farm-fresh goods to the tables of increasingly prosperous urban families.
As much as 70 per cent of India's population lives in rural areas, while agriculture accounts for only 22 per cent of the nation's gross domestic product (GDP).
Laggard agriculture must grow at 4.1 per cent a year if India's GDP, currently growing at a rate close to 8 percent, is to grow by 10 per cent over the next five years, experts said at a special interest session at the conference organised by the Confederation of Indian Industry (CII) and the Davos-headquartered World Economic Forum.
Infrastructure shortage, the usual suspect in many such ambitious ventures, was seen as a roadblock that must be removed. Government officials and private business leaders must put together their heads to crack the problem and push the economy to use its resources more efficiently, the experts said.
"The good news is that private enterprise is now being encouraged to participate in rural development," said Sunil Bharti Mittal, Managing Director of Bharti Airtel Ltd.
He said rural India had shown great receptiveness to private players who brought in low-cost communications, opportunities for crop diversification or product enhancement or avenues to faciliate the education of children.
Mittal's Bharti group on Monday announced its retail partnership with global giant Wal-Mart. With agricultural products such as fruits and vegetables expected to become significant in organised retail, rural linkages to the urban economy are expected to be strengthened.
Jyotiraditya Scindia, member of parliament, called for effective public-private partnership models to provide information, technology and tools to farmers. He spoke of a "farm-to-fork" formula to harness resources better.
"Rural India presents a beautiful business opportunity. To exploit it, the government needs to intervene to provide value to farmers on the social side and enterprise on the business side," said Scindia.
Among global brands that have links to farms is Nestle, which makes a host of products from noodles and coconut milk to the world's most popular brand of instant coffee.
Martial G Rolland chairman and managing director of Nestle India, said, "Indian can become the agri powerhouse of the world provided both farmers and private business can see a clear benefit and a win-win partnership."
Graham Mackay, chief executive of brewery firm, SABMiller, UK felt that India's rural sector is over-regulated and complex. "India needs to take small steps, incrementally with a coherent approach to taxation and legislation, to harness the potential in rural India," he said.
Email Manoharan Rajendran: rajendran.manoharan@hindustantimes.com
