Agribusiness & food processing in the North East

Subhas Bhattacharjee

The North Eastern states are small, are in the developing stages, and have a long way to go in economic development and trade. The region contributes three percent of India’s gross domestic product. Barely one percent of the region’s agri-output is exported, with a lack of infrastructure for long-term storage. These states have factor endowments and skills that are quite amenable to trade and can be further developed and promoted for the purpose of exports and creating an international/ASEAN trade image of the North East. While the prospects of NE-ASEAN trade are good, the problems to overcome in developing them are also quite formidable.

 Agribusiness and Food Processing have emerged as high-growth, high-profit sectors. The vast availability of natural raw materials, favourable policy matters, and numerous economic incentives and benefits offered by the Central Government have made India and even the North East an attractive destination for investment in agro- and food processing. Though the sector has huge potential, it is unfortunate that it has somehow remained relatively underdeveloped, due to which enormous quantities of valued farm produce worth Rs 95,000 crore are wasted annually. In order to arrest this colossal national loss, the application of improved modern technology to develop an integrated food supply chain from the farm to the fork of the consumer is of utmost importance for both the north-east and the country as a whole.

 The NE region has a quantum of marketable surplus in a number of perishable commodities that are rated as immune boosters. Being the hub of organic and exotic agro-horticultural produce, spices, and herbs, the North East offers a basket full of opportunities for the unusual. With its proximity to Southeast Asian markets and being home to a diverse and exotic variety of fruits and spices, the region can be a major centre of agribusiness and can command high prices in the domestic as well as export markets. Many of these products have GI tags, thus triggering huge possibilities for branded marketing. Presently, around 26 agro-horticultural products from the north-eastern region possess GI tags.

 A dedicated marketing and visibility campaign with proper packaging and branding for products from Northeast needs to be implemented, which will help in increasing awareness in target customer segments. These could range from large to small enterprises, start-ups, or directly to customers. Further, the agricultural and horticultural value chains are marred by several challenges, such as an inadequacy of infrastructure, the unavailability of processing industries, production and aggregation issues, etc.

 In the Northeast, large losses from farm to plate are mainly attributed to poor handling, distribution, storage, and proper packaging. Valued resources that could otherwise be spent on more productive activities go into producing and transporting goods that only go to waste for the sake of appropriate primary or secondary processing or packaging. Losses at every stage of the food chain can be reduced by using appropriate processing and packaging. It is estimated that more than 40% of fresh produce is wasted due to various reasons in the region, resulting in a loss of nutritional value. The monetary loss on that count is also very high. Appropriate processing, packaging with proper branding, labelling, and publicity can pave the way to a great extent. Training and skill development in packaging can facilitate the first-generation entrepreneurs of the North East in making a dent in the marketing of their products.

 The agro-horticulture potential of the North-East has not been tapped, mainly due to a lack of market-led production practices, poor commercial understanding of farmers, insufficient infrastructure at the farm level, a poor transportation system, an inadequate road network, pack houses, cold storage, sorting grading lines, processing industries, etc. Time-bound agro-horticultural projects (Vocal for Local) through entrepreneurs and their marketing and branding can truly transform this goldmine region into a vibrant hub of horticulture business and trade.

 Initiatives of the Government of India to promote horticulture development, appropriate strategies like adoption of market-driven production systems, enhancement of productivity, appropriate post-harvest handling through proper packaging, loading and unloading of commodities, and promotion of the pack house concept, including collection centres in the production clusters, cold storage, processing, and value addition, as well as the creation of adequate transportation infrastructure and an organised marketing system, are necessary additions to current interventions to provide remunerative prices to farmers.

 The fruit and vegetable processing industry offers enormous possibilities to be the mainstay of economic development so as to directly benefit the farmers, prevent the wastage of valuable farm produce, and create enough direct and indirect employment opportunities for rural youth. The emphasis of the Government of India on introducing intensive cultivation of fruits and vegetables over higher land acreage and enhancing productivity, with the proactive involvement of agencies like the Mission for Integrated Development of Horticulture (MIDH) and the Mission for Organic Value Chain Development for the North East Region (MOVCD-NER), is going to bolster the sector. Processing, preservation, and value addition of produce are going to generate additional income for the farmers as well as the FBOs (Food Business Operators) including first-generation entrepreneurs and intermediaries, as well as the unemployed youth, leading to overall development. One can take advantage of this situation, thereby supporting his or her own sustainability and, in turn, supporting farmers and producers who are otherwise in a corner due to the unavailability of suitable and immediate food preservation systems.

 Influence of natural and organic foods’ of the north east on consumption patterns across urban centres and elite groups has already existed for a long time. Hence, the most important thing is to reduce post-harvest losses with their on-farm and near-farm cluster processing solutions suitable for Farmer’s Producer Organisations (FPO), Farmers Producer Companies (FPC) and also large individual farmers in the north-east. These sustainable processes and packaging can gear up the domestic and export markets further and create a win-win situation for farmers, producers, and entrepreneurs in the region. Besides, a plethora of expertise under different missions and incubation centres with an innovative hand-holding approach can significantly utilise the naturally available resources in the north-east.

 Considering the difficult terrain and the logistic issues, it is always preferred to set up facilities for value addition and processing in the MSME sector. One can initiate and facilitate linking the up-coming units with established PAN India brands in the market to avoid the initial stress of marketing the products directly. Marketing through established brands will support the processors in bringing up sustainability. However, there is ample scope to self-sustain the sector considering the potential horticultural production of the northeastern states.