19-02-2013, 03:44 PM
SURVEY SUGGESTS FDI IN MULTI BRAND RETAIL TO ADDRESS INFRASTRUCTURE GAPS
ABSTRACT
The higher levels of agricultural output and ample food stocks as on date and the
levels of reservoir storage this year augur well for bringing down headline inflation in the
next fiscal. It has been observed by the Economic Survey 2011-12 presented today by the
Union Finance Minister Shri Pranab Mukherjee in the Parliament. However, the Survey
expresses concern over the growth rate in agriculture sector which has fallen short of planned
target inspite of record food grain production. During the current Five Year Plan it is
estimated at 3.28 percent against the target of 4 percent. According to Survey, agriculture
and allied sectors are estimated to achieve a growth rate of 2.5 percent during 2011-12.
Agriculture including allied activities accounted for 13.9 percent of Gross Domestic Products
(GDP) in 2011-12.
The successive high production levels boosted the stock position of foodgrains in the
central pool and as on February 1, 2012 it was 55.2 million tonnes comprising 31.8 million
tonnes of rice and 23.4 million tonnes of wheat. This is adequate for meeting the
requirements under the targeted public distribution system (TPSD) and welfare schemes
during the current financial year. The Survey says that as per the Second Advance Estimates,
production of foodgrains during 2011-12 has been estimated at 250.42 million tonnes.
Expressing concern over decline in the area under food grains cultivation the Survey
calls for speedy improvement in yield through adequate investment in research and
development. Pooling of many land holdings may yield better results for which land laws for
leasing with sufficient safeguards in place should be considered. Addressing infrastructure
requirements in the agriculture sector, especially storage, communication, roads and market
should be priority.
According to the Survey, the outlook for the next fiscal remains bright but given the
rapidly rising levels of demand for food there is a need to consider some policy options to
ensure brighter medium term outlook. These options could, inter alia, be regular imports of
agricultural commodities in relatively smaller quantities with an upper ceiling on quantity
should to be decided annually, relatively well in advance, after assessing the likely domestic
situation in terms of production and consumption requirements. According to Survey,
“improving mandi governance, promoting inter-state trade by eliminating multiple levies,
taking perishables out of the ambit of the APMC Act, developing a ‘farm-to-fork’ retail
supply system, and addressing the investment gaps related to post harvest infrastructure for
agricultural produce including through FDI in multi-brand retail” may help in improving
agriculture commodities management in the country.