Secondary agriculture: The shift Indian farming needs

By Kushankur Dey 

Secondary agriculture assumes prominence with the announcement of the goal of doubling farmers’ incomes. The term ‘secondary’ has a bearing on climate change adaptation and its mitigation, small farm viability and profitability, food security, nutrition, sustainable utilisation of natural resources, and optimal usage of produce from primary agriculture and farm incomes.

In other words, promoting secondary agriculture has implications on attaining sustainable development goals, which aim to connect primary, secondary and tertiary sectors by using slack/idle factors of production, such as land and labour—contributing to primary agriculture production, capturing ‘value’ in primary agricultural activities, and generating additional income at the enterprise level.

While there is no formal definition of secondary agriculture, based on the Economic Accounts for Agriculture of the European Union, a Technical Advisory Committee on Secondary Agriculture was formed by the then Planning Commission in 2007, and the committee had set out the inclusion criteria as “assembling, ripening, cleaning, grading, sorting, drying, preserving, packing and storing.”

The essence of secondary agriculture was understood when the Ashok Dalwai Committee submitted its report on “adding value to primary agriculture and building agricultural enterprises in rural India” through “farm-linked activities and secondary agriculture” in February 2018. The committee has defined secondary agriculture as a production activity at enterprise/farm level, and it devised a four-fold strategy:

Sustainability of production;

Monetisation of farmers’ produce;

Strengthening of extension services;

Recognising agriculture as an enterprise, and enabling it to operate as such, by addressing various structural weaknesses.

This four-fold strategy for secondary agriculture has drawn attention of development professionals, agribusiness academics and experts, and policymaking bodies. Secondary agriculture, as is defined, can help drive the growth of primary agriculture, and three avenues have been identified that adequately help utilise capital, human resources, technology, organisational capabilities, and risk management:

Type A: Value-addition to primary agriculture production systems;

Type B: Alternative enterprises, but linked to rural off-farm activities;

Type C: Enterprises that thrive on crop residues and waste materials of primary agriculture.

Type A can be achieved by improving livelihood enhancement action plans that are implemented by farmer-based/community-based organisations. Linking farmers with the market through aggregation and assaying/grading of agricultural produce can help them in value enhancement and appropriation. Collectivisations, cluster farming, financial literacy, marketing skills are important to build this avenue.

Type B is based on utilisation of alternative enterprises to primary agriculture, but is associated with rural off-farm activities. For example, poultry, bee-keeping, duck farming and livestock management are off-farm enterprises that can be promoted as part of integrated farming system. Integrated farming can hedge farm risk in the period of crop failure, or ease out the seasonality in the stream of cash flows.

Type C are such enterprises that strive on crop residues, or by-products of primary agriculture. For example, after recovering sugar from cane, cane can be used as bagasse for molasses production. Similarly, cotton stalk and seed (after ginning) can be used for de-oiled cake preparation or utilised in the secondary/tertiary sector.

To promote agricultural entrepreneurship or agricultural enterprises, there is recognition of priority sector status for institutional credit; low-cost skilling and knowledge-based exposure of farm communities; specialised extension services for enterprises owned by females; priority under rural electrification objectives; fast-track procedures to avail benefits under the ongoing central sector schemes; and label geographical indicators to products of village-scale secondary agriculture.

It is worth noting that the Indian Council of Agricultural Research, in association with the World Bank, had instituted the National Agricultural Higher Education Project (with a $165 million funding support) in 2017-18 for a five-year period to promote skill development and agri-entrepreneurship amongst graduates of agricultural colleges, apart from institutional development and innovation funding to education. Agribusiness incubation and acceleration, if made marketable, can benefit farm communities, and appropriate market linkages can improve farmers’ realisations through collectivisation. However, a concerted effort at both policy and implementation levels at the Centre and states is necessary to attain this goal.

The author is assistant professor, IIM Lucknow, associated with the Centre for Food & Agribusiness Management. Views are personal

Source: Financial Express