Leveraging Value-addition to Enhance Farmers' Income

India recorded agricultural exports of $43.37 billion, registering an increase of 6.04 per cent in the financial year (April 2022 January 2023). As the international market for value-added products is constantly growing, it is time India moved faster towards export of agri products.

- Dipti Barve

According to the SBI Ecowrap report, India's share of value added agri products in its agri export basket is less than 15 per cent. In contrast, in countries like the US and China, these commodities account for 25 per cent and 49 per cent of their exports. Firms that are into agri exports should evaluate what consumers want and, accordingly, leverage the value-addition programme in their commodities. For instance, rather than exporting rice in bulk, the focus should be on creating smaller but targeted product segments such as rice flour which is in high demand in Europe, especially the southern part where it is widely used to produce pasta, crisps, cereals and snacks. Similarly, rice starch is required by the pharmaceutical industry, and is also used as a thickener in sauces and desserts. Rice sweetener is again a value-added product and is used in sugar syrups and honey. Some aromatic varieties of Basmati rice are imported by breweries in Europe, especially by some prized beer manufacturers. Likewise, rice bran is in high demand as it is utilised for cereals, mixes, and vitamin concentrates and edible oil.

The evolving marketplace and market forces offer a plethora of business opportunities in product differentiation and, influenced by rising customer demand for health, nutrition and convenience foods as well as productivity improvements by food processors. India has huge opportunities in the export of value-added products in agriculture which includes the major segments like meat and seafood, food grains, horticulture, floriculture, coconut, plant-based meats etc. Many agritech startups are promoting value-added products from agriculture in the domestic and international market. There is a need to make an action plan to promote the export of value added agri products which includes creating a business ecosystem for agri product exports, policy interventions, training and hand-holding of producers.