vibrant gujarat - food & agro sector profile
TRANSCRIPT
Agri-business and Food processing
SECTOR PROFILE
1. India–preferred investment destination
2. Gujarat–preferred investment destination in India
3. Food & Agro sector
• 3.1 Indian overview
• 3.2 Gujarat scenario
4. Advantage Gujarat
5. Doing Business in Gujarat
6. Tax & regulatory framework in Gujarat
Table of Contents
INDIA - PREFERRED INVESTMENT DESTINATION
101
INDIA - PREFERRED INVESTMENT DESTINATION
th9 largest economy in the world by nominal GDP and
rd3 largest by purchasing power parity (PPP)
Recorded the highest growth rates in the mid-2000s
One of the fastest growing economies in the world (GDP growth rate – 8.6% in 2011)
GDP growth rate
Sectors’ contribution to GDP
Trade Scenario, USD billion
India is one of themajor G-20 economies:
ththe 17 largest exporter andth11 largest importer in the world
Main Export Partners
ndThe 2 preferred global investment destination
(World Investment Prospects Survey 2010-2012 by UNCTAD)
USD 254 billion of FDI inflows between April 2000 and
March 2012
Main Import Partners
US 13%
UAE 12%
China 8%
Hong Kong4%
China12%
UAE 7%
Saudi Arabia6%
US6%
Australia5%
FDI Confidence Index, 2012A.T. Kearney Survey
FDI - Top Sectors
9.5% 9.6% 9.3%6.8% 8.0% 8.6%
0.0%
5.0%
10.0%
15.0%
2006 2007 2008 2009 2010 2011
0
50
100
150
200
250
300
350
400
1990-91 1994-95 2000-01 2004-05 2010-11
Export Import
1.52
1.52
1.6
1.73
1.87
0 0.5 1 1.5 2
Germany
US
Brazil
India
China
Services30%
Telecommunications12%
Computer softwareand hardware
11%
Real estate11%
Constructionactivities
10%
Power7%
Automobile industry
6%
Metallurgical industries
5%
Pharmaceuticals5%
Petroleum and natural
gas3%
No Change
Decline
Growth
CAGRExports
14%
CAGRImports
14%
- 200 400 600 800 1,000 1,200
Agriculture Industry ServicesUSD, billion
16%
17%
17%
18%
19%
20%
25%
26%
26%
26%
25%
26%
59%
58%
57%
56%
56%
54% 2006-07
2007-08
2008-09
2009-10
2010-11
2011-12(A)
(Q)
02
World's largest democracy with1.2 billion people
Land of abundant natural resources and diverse climatic conditions
Enabling business environment with greater global participation
Strong Market Fundamentals
Access to technology as a result of the IT revolution
Impetus on Infrastructure Development
Progressive simplification and rationalization of direct and indirect tax structures
Competitivelypriced skilledlabour
ADVANTAGE INDIA
03
GUJARAT - PREFERRED INVESTMENTDESTINATION IN INDIA
204
Gujarat’s Degree of Openness (ratio of exports from state to Gross State Domestic Product)
53%
A highly industrialized state - Gross State Domestic Product contribution from manufacturing sector
28%
Growth in agricultural output in the state over the last 10 years 11%
Double digit growth rate with Gross State Domestic Product of USD 75 billion(2010-11) growing at a five year average of
10%
26%A state with one of the highest share in investments under implemented projects in India
A state with a high and growing literacy rate 79%
Increase in seat availability in technical institutions over last 3 years 100%
A state with a population of 60 million and one of the highest urbanization levels 43%
GUJARAT HAS BEEN RANKED 1ST AS PER THE “ECONOMIC FREEDOM RANKINGS FOR THE STATES OF INDIA, 2012” REPORT
05
FOOD & AGRO SECTOR
306
FOOD & AGRO SECTOR INDIAN OVERVIEW
3.1INDIAGUJARAT
07
OVERVIEW
Food Grains | Spices | Fruits & vegetables | Diary products | Meat & poultry | Fisheries | Flowers | Processed foods & beverages
• The Indian food market is slated to reach USD 300 billion in 2015• The Food Processing Industry is estimated to be worth around USD 67 billion and expected to increase to USD 175
billion by 2025• 46 out of 60 soil types and 20 agri-climatic regions exist in India. India has 52% cultivable land compared to 11%
world average. India has 1.84 million sq.km of arable land, which is more than that in China, USA, Japan• India is among 15 leading exporters of agricultural products in the world• India's agricultural exports amounted to USD 23.2 billion with a 1.7% share of world trade in agriculture in 2010.
Exports of agricultural products are expected to account for 5%of the world's agriculture exports by 2014
Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI); IBEF; International Trade Statistics 2011, published by the World Trade Organization (WTO); APEDA; National Institute of Food Technology Entrepreneurship and Management; Director General of Commercial Intelligence & Statistics
• World’s largest producer of milk and livestock, with an annual production of 122 Million Metric Tonnes (MMT) of milk with 528 million livestock
• 2nd largest producer of fruits and vegetables, producing 213 MMT• 3rd largest producer of food grains, producing 250 MMT and fish production of 8.3 MMT• India produces 63 billion eggs, with 649 million poultry• Agriculture engages 70% of Indian population. Food Processing sector alone employs
13 million directly and 35 million indirectly (2010-11)• Agriculture contributes to 18% of Indian GDP. Food Processing contributes 14% of the
manufacturing GDP, which amounts to Rs. 2,800 billion. (2010-11)
Segments of the Food & Agro Industry
08
• Production of food grains during 2011-12 is estimated at an all time record level of 250.42 MMT which is a significant achievement mainly due to increase in the production of rice and wheat.
• India has emerged as world's top rice exporter overtaking traditional leaders, Vietnam and Thailand.
• India's total rice export in 2011-12 is expected to be 6.5-7 MMT , which is around 7% of the country's total production.
KEY SEGMENTS
Grains Spices
• India produces a wide variety of spices like black pepper, cardamom, ginger, garlic, turmeric, chilli and a large variety of tree and seed spices.
• The total production of spices was 4.0 MMT and the area covered was 2.5 million hectares.
• India is the largest producer of ginger.
• Spice Board of India plans to promote exports of spices by establishing 25-30 spice parks in different parts of the country. This will help in achieving export of spices worth USD 5.6 billion (Rs 30,000 crore) by 2020.
India can move from self reliance
in food to being a major exporter
of agri products
Sources: Department of Agriculture and Cooperation, GoI; IBEF; FAPRI Agri Report, 2009
Production in MMT production demand in
(2010-11) 2020
Rice 95 123
Wheat 86 101
Pulses 18 41
Soyabean 13 13
Indian annual Projected
09
Sources: APEDA, Department of Agriculture and Cooperation, GoI;
41%
23% 24%10%
30%36%
0%
20%
40%
60%
80%
100%
Mango Banana Cashew nut Onion Cauliflower Green Peas
India World
India is the second largest producer of fruits and vegetables in the world, after China
• The vast production base offers India tremendous opportunities for export. • During 2010-11, India produced 75.8 MMT of fruits and 137.7 MMT of vegetables. The area under cultivation of fruits
stood at 6.6 million hectares while vegetables were cultivated at 8.2 million hectares.
KEY SEGMENTS
Share of Indian production of fruits & vegetables compared to global production
India exported fruits & vegetables worth Rs.38.56 billion which comprised of fruits worth Rs.26.35 billion & vegetables worth Rs.12.21 billion.
India’s export (2010-11)
• India accounts for about 15.5% of the 890 MMT of total global vegetable production.
• India is the largest producer of okra amongst vegetables & ranks second in production of potatoes (10%), onions, cauliflowers, brinjal, cabbages, etc.
Vegetables
Fruits• China, India, Brazil, US, Italy, Spain, Mexico, Iran, Philippines and France are the
top ten aggregate fruit producers • India accounts for about 10% of the 500 MMT of total global production of fruits
(excluding melons)• India is the largest producer & consumer of cashew nuts• India is the third largest producer of coconut and leads 90 coconut-producing
countries of the world, producing 11 MMT (2010-11)
10
• In 2011, the production was 122 MMT. The production level is expected to reach 180 MMT by the year 2021-22
• Indian Milk production contributes to 15% of global milk production.
• The market size of Indian Dairy Industry is estimated at around USD 60 billion (INR 2,662 billion).
• The organized cheese market including its variants of processed cheese is valued at around Rs. 4.50 billion.
• French cheese major, Fromageries Bel, a 10-billion French franc outfit, has entered the Indian market with La Vache Kirit or what is worldwide known as The Laughing Cow
“The dairy industry must respond to the rapidly growing demand for milk as the projected demand of 180 million Tonnes by 2021-22 would require our annual increase in milk production, which has been growing at 2.5 MMT to 5 MMT”
- Dr Amrita Patel, Chairman, National Dairy Development Board (NDDB).
• India has a large livestock base constituting 304.8 million livestock including 199.1 million cattle, 105.3 million buffalo, 71.6 million sheep and 140.5 million goat.
• The livestock population is projected to increase to 322 million by the year 2015.
• India ranks second in goat population around the world with goat population share of 25% in India's Livestock population.
• Indian Poultry Industry is booming and emerging as the world's 2nd largest market.
• India produces 63 billion eggs and 649 million poultry.
• India is the Ninth largest producer of poultry meat with a production of 2.5 MT of poultry meat.
• The market size for Poultry Industry is estimated at around USD 7.9 billion (INR 350 billion) and is growing at an attractive rate of 12%-15% annually.
KEY SEGMENTS
India is the largest producer of milk in the world.Dairy
Sources: GAIC
Meat & poultry
11
Sources: Department of Agriculture and Cooperation, GoI; Indian Express
KEY SEGMENTS
• India earned USD 48.5 million (around Rs 215.27 crore) from exports of flowers to over 90 countries during 2010-11 (April to December)
• Flower production in India was spread over 0.18 million hectares with a production (2010-11) of 1 MMT of loose flowers and 69 million tonnes of cut flowers.
• Major importers of Indian flowers are USA (5,830 MT), Germany (3,587 MT), Netherland (2,334 MT), United Kingdom (3,273 MT) and United Arab Emirates (618 MT) and Pakistan (2 MT).
Flowers
Major flower importing countries
12
• The Food Processing Industry is estimated to be worth around USD 67 billion and expected to increase to USD 175 billion by 2025
• The Processed Food sector has a potential of attracting USD 33 billion investment
• About 6% of the total Indian produce is processed
• There are over 25,000 registered units in the food sector with investments of Rs 840 billion
KEY SEGMENTS
Processed food
Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI); IBEF; APEDA; National Institute of Food Technology Entrepreneurship and Management; Director General of Commercial Intelligence & Statistics
Crop Cumulative wastage (%)
Cereals 3.9 –6.0%
Pulses 4.3-6.1%
Oil seeds 6.00%
Fruits & Vegetables 5.8 -18.0%
Milk 0.80%
Fisheries 2.90%
Meat 2.30%
Poultry 3.70%
Ministry of Food Processing Industries (MoFPI) through its Vision 2015 envisages• Increasing the level of processing of perishables from 6% to 20%;• Raising value addition from 20% to 35%• Enhancing India’s share in global food trade from 1.5% to 3.0%
Year FDI in Food
Processing (in Rs Cr.)
2004 -05 174
2005 -06 183
2006 -07 441
2007 -08 632
2008 -09 456
2009 -10 1314
2010 -11 858
Value of Exports of food processing related commodities
Rs. c
rore
19,257 23,685 23,766
26,802 29,211 34,204
43,783 49,352 50,759
63,733
-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2001-02
2001-03
2001-04
2001-05
2001-06
2001-07
2001-08
2001-09
2001-10
2001-11
13
Sources: Union Budget 2012-13
GOVERNMENT SUPPORT & ENABLERS
• The target for agricultural credit in 2012-13 has been raised to Rs. 575,000 crore (USD 107.4 billion). This is an increase of Rs. 1 lakh crore (USD 18.7 billion)
• The total plan outlay for agriculture and cooperation has been increased by 18% from Rs. 17,123 crore (USD 3.2 billion) in 2011-12 to Rs. 20,208 crore (USD 3.7 billion) in 2012-13
• The allocation for Rashtriya Krishi Vikas Yojna was also increased by 17% to Rs. 9,217 crore (USD 1.7 billion)
• A short term RRB Credit Refinance Fund was proposed. Also Kisan Credit Card Scheme is to be modified to make it a smart card which can be used at ATMs
• A new centrally sponsored scheme-National Mission on Food Processing is to be started in cooperation with States in 2012-13
• Proposal made to allocate Rs 300 crore (USD 56 million) to Vidarbha Intensified Irrigation Development Programme under RKVY.
• Interest subvention scheme for providing short term crop loans to farmers at 7% interest per annum would be continued in 2012-13. Additional subvention of 3% is to be made available for prompt paying farmers
• Rs. 2,242 crore (USD 418.63 million) project launched with World Bank assistance to improve productivity in the dairy sector
• Rs. 500 crore (USD 93.36 million) proposed to be provided to broaden scope of production of fish to coastal aquaculture
Union Budget 2012-13
The Government of India's focus in the 12th Five Year Plan will be "mechanization of agriculture"
The Government of India's focus in the 12th Five Year Plan will be "mechanization of agriculture"
14
• External Commercial Borrowings available for cold storage projects
• Automatic approval for foreign equity up to 100% is permitted for most of the processed food items
• The Government proposed to reduce basic customs duty from 7.5% to 2.5% on sugarcane planter, root or tuber crop harvesting machine and rotary tiller and weeder and parts for the manufacture.
• Fringe Benefit Tax on food processing is abolished.
• Investment linked tax incentives are extended to cold chains and warehousing of agricultural products.
• Creation of NABARD’s fund for funding the sector.
• The NABARD has increased financial assistance in Gujarat by 50% in 2011-12, to touch Rs 4,340 crore (USD 810 million) as compared to Rs 2,894 crore (USD 540 million) in 2010-11
• Customs duty and excise duty reduced progressively on machinery and other inputs
• 30 Mega Food Parks have been approved, out of which 15 are ongoing projects
GOVERNMENT SUPPORT & ENABLERS
Sources: Ministry of Food Processing Industries (MoFPI); The Times of India
Food processing industries have been put in the list of priority sectors for bank lending – implying easier availability of credit
15
Sources: Ministry of Food Processing Industries (MoFPI); IBEF; India Food Report 2008; 11th Five Year Plan
INVESTMENT TRENDS
• The Centre has set an investment target of USD 18.9 billion (Rs. 100,000 crore ) by 2015 in the Food Processing sector
• There are 25, 367 registered food processing units in the country whose total invested capital is USD 15.9 billion (Rs. 84,094 crore )
• The Government of India has approved setting up of 15 Mega Food Parks (apart from ongoing 15 MFPs) under Infrastructure Development Scheme, with a total grant of USD 149 million (Rs. 787.50 crore), during the 11th Five Year Plan
• The 30 Mega Food Parks will help 20,000 SMEs engaged in the manufacturing and processing of food products every year.
• The Ministry of Food Processing Industries has allocated USD 112 million (Rs. 595 crore) for different schemes to be implemented in the food processing sector during 2011-12
• An Inter-Ministerial Task Force on Agricultural Marketing Reforms, constituted by the Union Ministry of Agriculture, had recommended the creation of additional cold chain facilities with an investment of USD 473 million (2,500 crore)
Mega Food Park scheme (Rs. 15.75 billion)Modernization of abattoirs (Rs. 8.28 billion) Integrated cold chain facilities (Rs. 2.10 billion)
650 180
4,031
2,613
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Total Plan allocation Allocation for infrastructure development
Plan allocations through Five Year Plans in
Food Processing
10th five year plan 11th five year plan
In R
s. c
rore
FDI: The food processing industries in India have attracted Foreign Direct Investment (FDI) worth USD 1.3 billion from April 2000 to September 2011.
The major infrastructure envisaged under the 11th Five Year Plan
16
• Most of processed foods are exempted from the purview of licensing under the Industries Act
• Food processing industries are included in the list of priority sectors for bank lending (Budget 2001-02)
• Automatic approval of foreign equity up to 100% is available
• Excise Duty on processed fruits and vegetables has been brought down from 16% to 0%
• Income Tax Holiday was announced for certain categories of food processing industries (Budget 2004-05).
• Excise Duty has been waived off on milk products and poultry and Excise Duty on aerated drinks has been reduced to 16% from 24% (Budget 2006-07).
• Excise Duty on Ready to Eat packaged foods and Ready to Mix food items has been reduced to 0% from 8% (Budget 2007-08).
• Customs Duty of Food Processing machinery has been reduced to 5% from 7.5%.
POLICY INITIATIVES
Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI);
• Excise Duty on refrigerated motor vehicles (reefer vans) has been reduced from 16% to 8%. Customs Duty on refrigerated motor vehicles has been waived off.
• Exemption limit of Excise Duty for small scale industries has been raised from Rs. 10 million to Rs. 15 million
• All services provided by Technology Business Incubators and their Incubatees whose annual business turnover is less than Rs. 50 lakh have been exempted service tax for the first 3 years.
• Project import status with concessional import duty of 5% and full exemption of service tax for installation and commissioning of mechanized handling systems, pallet racking systems and warehouses.
• Project import status with concessional import duty of 5% and full exemption of service tax to the initial setting up and expansion of cold storage, cold rooms including farm pre-coolers for preservation or storage of agricultural / related sector produce; and processing units for such produce
Food processing industries have been put in the list of priority sectors for bank lending – implying easier availability of credit
17
FOOD & AGRO SECTOR GUJARAT SCENARIO
3.218
OVERVIEW
Sources: Socio Economic Review 2011-12 of Gujarat; Department of Agriculture and Cooperation, GoI; Gujarat Green Revolution Company Ltd.
• Out of the total geographical area of 196 lakh hectares in Gujarat, total cropped area is around 128 lakh hectares (65%).
• Gujarat has seven agro-climatic zones and wide varieties of soil
• The production of total food grains during 2010-11 is at 10.1 MMT as against 5.6 MMT in 2009-10.
• The production of cotton during 2010-11 is at 9.8
Gujarat tops the agriculture growth table in the country growing at a CAGR of 10.7% over the last decade.
• Under the MIS
Scheme 3.2 lakh
hectares were
covered and 2.0 lakh
farmers benefitted
during 2005-11
period.
• Farmers had an
additional income of
Rs. 946 crore during
2005-11 due to MIS
25,582 32,940 38,162 48,441 47,540
78,143
107,253
23,222 28,577 27,815 32,408
28,506
47,092
53,333
13.514.5
14.5 15.914.1
18.2
20.9
15.216.5
14.715.2
12.5
14.2
14.6
0
5
10
15
20
25
30
35
40
-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
110,000
120,000
2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
Agriculture contribution to GSDP at Current Prices In Rs. Crore
Agriculture contribution to GSDP at Constant Prices (2004 -05) In Rs. Crore
Agriculture contribution to GSDP at Current Prices % of total GSDP
Agriculture contribution to GSDP at Constant Prices (2004 -05) % of total GSDP
Rs. C
rore
Shar
e of
the
sect
or a
s a
% o
f GSD
Pmillion bales as against 7.4 million bales in 2009-10.
• The major vegetables grown in Gujarat are Onion, Potato, Brinjal, Tomato, Okra and Cucurbits.
• The State mainly produces spices viz. Cumin, Fennel, and Garlic.
• GoI and GoG have spent Rs. 8530 million during2005-2011 under Micro Irrigation System (MIS) Scheme
19
KEY SEGMENTS
Food Grains
Sources: Socio Economic Review 2011-12 of Gujarat; Previous Socio-Economic Reviews
Cotton
• There is an increase of 79.65% in food grain production in 2010-11 over the previous year 2009-10
• The productivity of food crops is estimated at 20.03 MT/Hectare
The production of total food grains during the year 2011-12 is estimated at 10.1 MMT against the production of 5.6 MMT in 2009-10
0
1,000
2,000
3,000
4,000
5,000
6,000
0
200
400
600
800
1000
1200
1400
1600
1800
Rice Wheat Jowar Bajra
Area in HA & production in ‘000 tonnes
Area in 2009 -10 Area in 2010 -11Production in 2009 -10 Production 2010 -11
• The production of cotton during the year showed an increase of 32.75 percent in 2010-11 over the previous year.
Production of cotton in Gujarat
1,906 2,011 2,372 2,422 2,354 2,464 2,623
5,444
6,872 7,876 8,276
7,014 7,401
9,825
2004 - 05 2005 - 06 2006 - 07 2007 - 08 2008 - 09 2009 - 10 2010 - 11
Area in '000 hectares Production in '000 MT
The production of cotton in Gujarat amounts to 31% of production in the country.
20
KEY SEGMENTS
Sources: Socio Economic Review 2011-12 of Gujarat; Department of Horticulture, Gujarat; Agriculture and Cooperation Department, Gujarat.
Fruits, vegetables & spices
• State is in leading position in production of Onion,Potato, Banana, Lime and Papaya
• The average productivity of vegetables is estimated at 18.95 MT/Hectare
• Gujarat has the highest productivity in custard and guava production in India
• World’s largest producer of cumin
• The state also enjoys leading position (1st rank to 4th rank) at all-India level in the productivity levels of major fruits and vegetables including onion, potato, banana, guava, tomato, lime, papaya, etc.
The famous kesar variety of mango in Gujarat, known as ‘Gir Kesar’ mango, has been granted Geographical Indication tag, thus making it the second mango variety in India to have such distinction.
The growth in vegetable production was the highest and recorded 45% growth in volumes in 2011-12 as against 2008-09 production figure
At all-India level, the State contributes 14 percent to 20 percent share in major fruit and vegetable crops like; Papaya, Sapota, Onion, Banana and Lime.
0.010.020.030.040.050.060.070.080.0
Fruits Vegetables Spices
60.068.1
9.1
69.9 72.6
9.4
78.4 73.6
9.5
Production in lakh tonnes
2008 -09 2009 -10 2010 -11
21
KEY SEGMENTS
Flowers
Sources: Socio Economic Review 2011-12 of Gujarat; Department of Horticulture, Gujarat; Agriculture and Cooperation Department, Gujarat. The Times of India
• During 2010-11 the production of flowers was 1.3 lakh tonnes, spread over 15,000 hectares
• State has taken a lead in the sector of establishing Green House by producing high value flowers like Dutch Roses, Gerberas and Carnation. Government of Gujarat offers 50% subsidy for setting up green houses
• Major flowers grown in the state are Roses Lily, Marigold, Jasmine, Tuberose. Flowers like Dutch Roses, Gerberas and Carnation are being grown.
• Flowers grown in south Gujarat are sold in the world's biggest flower markets of Amsterdam in Holland and London in United Kingdom on a regular basis.
• Different varieties of Dutch roses that are being grown in the green houses of Mahudi, Vyara, Bagumara and Bardoli reach the markets in Tokyo, Dubai and those in European countries via Amsterdam every week.
• Three firms from south Gujarat export as much as 1.5 lakh Dutch roses from the state. One of these also exports 50,000 Gerbera flowers to London.
3,978 5,496 597
3,209 1,699
30,939
49,562
3,204
26,044
18,030
-
10,000
20,000
30,000
40,000
50,000
60,000
Rose Merigold Mogra Lilly Others
Production of flowers in Gujarat in 2010 -11
Area in hectares Production in MT
22
KEY SEGMENTS
Source: Socio Economic Review 2011-12 of Gujarat; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat
Fisheries
• Fishing fleet have increased up to 35,275 (2011) of which 23,066 were mechanized and 12,209 were non-mechanized
• During the year 2010-11, the total fish production in Gujarat has been estimated at 7.75 lakh tonnes
• The area of continental shelf is estimated at164,000 sq.km and is 32.54 % of the shelf area|of India
Gujarat contributes 28% of the national marine export in quantity and 15% in terms of value
23
Total Coastal Belt 1,600 Km
Inland Reservoirs
Major fish categories
Marine Small Sciaenids, Bombay Duck, Ribbon Fish, Catfish, Promfret
Inland Katla, Rohu, Mrigral
Value of Fish Production in 2010-11 was Rs. 41.51 billion
Gujarat ranks first among the states in marine fish production and exported 1.98 lakh tonnes of marine products worth Rs. 2,156 crore in 2010-11
3.54 lakh ha
5,20,000
5,40,000
5,60,000
5,80,000
6,00,000
6,20,000
6,40,000
6,60,000
6,80,000
7,00,000 Marine fish production in Gujarat in MT
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
20010-11
Prod
ucti
on in
MT
Source: GAIC; Socio Economic Review 2011-12 of Gujarat; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat
Animal husbandry
Animal husbandry plays a vital role in Gujarat’s rural economy, while contributing nearly 5% to the state GSDP
• Gujarat has 23 Intensive Cattle Development
Projects (ICDP) with 1078 Breeding Centres in the
state which are aimed at improving the breed of
cattle and buffaloes
• Gujarat has 12 Intensive Poultry Development
Projects (IPDP), 5 District poultry Extension Centres,
and 85 Poultry Service Centres
• As per the provisional results of livestock* census
2007, total livestock population of Gujarat was
237.94 lakh
• As per the estimates of the Integrated Sample Survey
(ISS) of major livestock products, the production of
milk has increased to 93.21 lakh tonnes in 2010-11 as
against 88.43 lakh tonnes in 2009-10
Cow Gir, Kankarej
Buffalo Jafrabadi, Mehsani, Surti
Sheep Patanwadi, Marwadi
Goat Surti, Mehsani, Kutchchi, Zalawadi, Gohilwadi
Horse Kathiawadi, Marwadi
Camel Kutchchi
Major Livestock Products
2008-09 2009-10 2010-11
Milk(In million tonnes) 8.38 8.84 9.32
Eggs(In million numbers) 1267.50 1276.20 1326.90
Wool(In million kilos) 2.85 2.92 2.92
24
KEY SEGMENTS
KEY SEGMENTS
Source: GAIC; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat
Dairy
Gujarat CooperativeMilk Marketing
Federation (GCMMF)
• State level apex body of milk cooperatives in Gujarat
– aims to provide remunerative returns to farmers
and also serve interest of consumers by providing
quality products which are good value for money.
• I ndia 's largest food produc ts mar ket ing
organisation. Dairy No. 1 in Asia and Dairy No. 2 in the
world
• GCMMF has received the APEDA Award from
Government of India for Excellence in Dairy Product
Exports for the last 13 years.
• Milk Collection (Total - 2010-11) - 3.45 billion litres
• Milk collection (Daily Average 2010-11) – 9.45 million
litres (peak 12 million)
• During the year 2010-11 export turnover was of
Rs. 98 crore
• 17 Cooperative dairy plants & 25
private dairy plants
• 14,598 Milk Cooperative Societies
• 115 lakh liter/day milk production
• 3.01 million of milk producers
Gujarat Dairy Facts
Production of milk in lakh kgs
248
231
234
235
957
1192
1415
1593
1850
1851
1912
1978
4857
5110
5285
5514
0 2000 4000 6000 8000 10000
2007-08
2008-09
2009-10
2010-11
Goat Cross-b red cow Indigenous cow Buffalo
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CENTRAL GOVERNMENT INITIATIVES
Source: Socio Economic Reviews of Gujarat; Ministry of Food Processing Industries (MoFPI)
National Horticulture Mission (in effect till XI plan) with main thrust on augmenting production of all horticultural products (Fruits, Vegetables, Flowers, Plantation crops, Spices, Medicinal Aromatic plants) in the states.
• Under the Kisan Credit Card S c h e m e w h i c h w a s introduced in 1998-99, total accounts have increased to 27.02 lakh with an amount of Rs.16,067 crore (t i l l September 2011).
• Keen implementation of other GoI initiatives: NFSM, ATMA
• The public sector banks have been formulating Special Agricultural Credit Plans (SACP) since 1994-95 to improve credit flow to the agriculture sector.
• Rashtriya Krishi Vikas Yojana (introduced in 2007, valid till 2012) – District wise State plan scheme to incentivize the States that increase their investment in Agriculture and allied sectors
• Under this scheme subsidy is provided to Agriculture Produce Market Committees for Cold-Storage, Godown, Solid Waste Management and New Market Development.
• Schemes for Agri Infrastructure like Mega Food Parks, Cold Chains, modernization of Abattoirs
• S c h e m e f o r t e c h n o l o g y u p g r a d a t i o n a n d establishment and modernization of food processing industries.
• Scheme for quality assurance, codex standards, R&D and other promotional activities.
• Strengthening of institutions like Indian Institute of Crop Processing Technology
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STATE GOVERNMENT INITIATIVES
Sources: Agriculture and Cooperation department, Gujarat
• The Eight Krushi Mahotsav 2012 was started on 24 April 2012
• An assistance of worth Rs.720 crore has been given to around 15.17 lakh famers in 25 days. Assistance for purchasing 11,000 tractors and 34,00 rotavators was also given.
• 225 talukas and 4397 village clusters were visited with 4400 Krishi Raths.
• Around 3.5 lakh soil specimens were tested in laboratory .
• 2.75 lakh soil health cards were given.
• 40 lakh animals were vaccinated and around 4.5 lakh animals were treated for diseases
• National Agricultural Insurance Scheme -(NAIS/Rashtriya Krishi Bima Yojana) – Gujarat State ranks first with respect to risk covered (Sum Insured), premium income, subsidy paid, farmers covered and claims paid under NAIS among the implementing States.
• Gujarat Green Revolution - GGRC is aimed to provide professional services on Micro Irrigation System coupled with required equipments and essential agro inputs to the farmers of Gujarat
• Soil Health Cards (SHCs) under the Soil Health Programme of the Agriculture Department: The SHCs are prepared after the soil is tested scientifically for various properties like productivity, mineral composition, water retaining capacity and others. The SHCs also contain information on what kind of pesticides, fertilisers, seeds and how much water should be used to get better productivity from the land. These details would help farmers take accurate action to increase productivity of the land. Till December 2011, 38.20 lakh SHCs were distributed to farmers. 2.75 lakh SHCs were given during Krushi Mahotsav 2012
• Soil and water testing laboratories and Krushi Vigyan Kendra (KVKs) Support
The State Government initiatives like Krushi Mahotsava, have put Gujarat in a leading position in Onion, Potato, Banana, Lime and Papaya production. State has taken a lead in establishing Green House for producing high
value flowers like Dutch Roses, Gerberas and Carnation
27
STATE GOVERNMENT INITIATIVES
Sources: Agriculture and Cooperation department, Gujarat
Kisan Credit Cards: The Gujarat Government has initiated a programme to cover all its farmers under the ‘Kisan Credit Cards’ issued by commercial banks which aims at augmenting their borrowing capacity from banks and will also take care of their day-to day needs. The Government has directed all officials to cover those farmers who have so far not been issued Kisan Credit Cards
• Farm Accident Insurance Scheme
• Gujarat Comprehensive Community Accidental
Insurance Scheme
• Gujarat Agro Industries Corporation (GAIC) -
Promotes agricultural activities at the ground
level and helps in development of agro industries
and accelerates demand-based production of
agro products to develop agro industries in the
new global agricultural environment.
• Three phase 24×7 electricity supply to all villages
(Jyotigram Yojna)
• Enabling of Contract Farming
• Framing of Bio-technology Policy & Agri Business Policy
• Policy for waste land utilization
• Financial assistance up to Rs 75 lakh is made available to
educational institutions in food technology for starting
the course as well as for up gradation.
• At the end of year 2010-11, 205 Agriculture Produce
Market Committees (APMCs), 199 Main Yards of Market
Committees and 201 Sub Market Yards were
operational in the State.
• 37 APMCs connected by futures market through
NMCDX
“Gujarat State Horticultural Mission (GSHM)”, a registered society has been formed for implementation of
“National Horticulture Mission (NHM)” in the state, with a view to double the horticulture production and income
by the year 2012 by adopting end-to-end approach with simultaneous development of post harvest infrastructure
and marketing facilities. The Mission is being implemented in 15 potential districts and covers 10 important
crops of the state viz. mango, chikoo, amla, banana, papaya, lime, cumin, fennel, flowers, medical and aroma crops.
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EDUCATIONAL INFRASTRUCTURE
Source: Websites of the universities; GAIC; Agriculture and Cooperation department, Gujarat;
Anand Agricultural University
• It was set up to provide education support to the farming community in areas such as Agriculture, Horticulture, Engineering, Information technology and Business Studies.
• It aims to promote development in rural areas through education, research andsupport services
Junagadh Agricultural University
•agriculture, Agricultural Engineering and Technology and fisheries, Veterinary Science and Animal Husbandry.
• Offers MBA in Agri Business Management
Has colleges offering courses in
Kamdhenu Veterinary University
• It was set up in 2009-10 for the development of research, education, and extension in the field of Animal Husbandry, Diary Development and Fisheries
• Has established Diary Science College and Livestock Inspector Training Centre
Sardarkrushinagar Dantiwada Agricultural University
• Offers courses in faculties such as agriculture, horticulture, veterinary science and animal husbandry, home science and nutrition, diary science and food technology
• Offers a course in Agri Business Management
Navsari Agricultural University
• Has faculties of agriculture, horticulture, veterinary science and forestry
Indian Institute of Management Ahmedabad offers a two-year Post-Graduate Programmein Agri-business Management (PGP-ABM)
29
TREND IN INVESTMENTS
• The State has received cumulative foreign direct investment (FDI) inflows across all sectors worth USD 7.2 billion during April 2000 to April 2011
• were signed in Vibrant Gujarat 2011 for projects to be established in the Food and Agri sector
• Proposed investment – INR 34,851 crore
• The average investment per MoU is about Rs. 50 crore
690 MoUs & Announcements
Source: iNDEXTb
30
INVESTMENT OPPORTUNITIES
Sources: Ministry of Food Processing Industries
Mega Food Park Scheme of India (MFPS)
MFPS is expected to facilitate the achievement of the Vision 2015 of Ministry of Food Processing Industries to raise the processing of perishables in the country from the existing 6% to 20%, value addition from 20% to 35% and the share in global food trade from 1.5% to 3% by the year 2015. The present scheme/benefits of Mega Food Park of Government of India will be extended to the Mega Agribusiness Parks be developed in Gujarat over the next 3 years.
Agri / horticulture infrastructure projects: cold storage, fresh fruits and vegetables pack house, mechanized grain handling and storage at port, Food Parks, terminal markets, irradiation centers.
Export-oriented processing
Value added processing based on local resources
• Natural resources based opportunities: natural food colors, medicinal herbs extraction, tree oil based bio-pesticides, Food Processing enzymes and so on.
• Newer technology based projects/opportunities
Horticulture related industries in State
Onion dehydration units | Mango pulp and pickles units | Canned vegetables | Potato flakes | Tissue culture laboratories | Nurseries | Spices and psyllium processing units | Cold storages
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KEY INDUSTRY PLAYERS IN GUJARAT
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GUJARAT FOOD & AGRO SECTOR – SUCCESS STORY
Amul: the brand that spurred a white revolution in India
• Formed in 1946, managed by Gujarat Cooperative Milk Marketing Federation limited (GCMMF)
• The Amul model has helped India to emerge as the largest milk producer in the world. More than 13 million milk producers pour their milk in 1,28,799 dairy cooperative societies across the country.
• GCMMF has received the APEDA Award from Government of India for Excellence in Dairy Product Exports for the last 13 years.
• Amul has more than 150 chilling centres in villages
• Exports to Mauritius, UAE, Bangladesh, Australia, China, South Africa, Singapore, Malaysia, Nepal, Pakistan, Hong Kong & USA
• GCMMF has been accorded a "Trading House" status
• GCMMF is India's largest food product marketing organization with annual turnover (2010-11)US$ 2.2 billion (Rs. 9,774 Crores)
• Aims for a turnover of 27,000 crore by 2020
• Total Milk handling capacity per day - 13.67 million litres
• Milk Collection (Total - 2010-11) - 3.45 billion litres
• Milk collection (Daily Average 2010-11) - 9.2 million litres (peak 12 million)
• During the year 2010-11, achieved export turnover of Rs. 98 crore
• Has 5 lakh distribution centres in the country
Dairy No. 1 in Asia & Dairy No. 2 in the world
The key success factors are – strong supply chain & distribution network, diversified product line, low cost strategy, adoption of technology & e-initiatives
Future:• Amul has signed an agreement with Walmart to stock its products in Walmart stores in USA• Looking to offer low-fat version of its products• Planning to enter Japan and Sri Lanka• Has tied up with Glaxo to sell baby food
Sources: www.amul.com
0.4 0.4 0.5 0.5 0.5 0.5 0.5 0.5 0.6 0.6 0.70.9
1.11.3
1.51.7
2.2
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1.0
1.5
2.0
2.5Sales in USD billion
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
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GUJARAT FOOD & AGRO SECTOR – SUCCESS STORY
McCain
McCain’s journey to success began in 1997 when it made its entry into India with a proposal to invest Rs.1 billion (USD 25 million) in potato fry business. McCain-McDonald’s India’s initiative with Gujarat farmers has grown into aunique technology driven enterprise
• McCain is the most famous Canadian brand name in the world, which manufactures frozen food products, such as French fries, appetizers, pizzas, vegetables, desserts, juices, entrees and oven meals.
• 2006 – Plant opened in Gujarat to produce retail and food-service French fries, and potato specialties. Among the potato specialties the plant eventually produced a number of popular Indian style potato snacks.
• The plant supplies markets in Sri Lanka, Pakistan, Bangladesh and Nepal, as well as India and exports 10-15% of its output to South and South-East Asian countries and the Middle East.
• McCain Foods sources significant share (nearly 85%) of the potatoes needed for manufacturing its products from Gujarat itself. It has undertaken potato contract farming in various parts of north and central Gujarat.
• McCain Foods India (MFI) processes and supplies frozen potato products from its $14.6 million plant on the National Highway number 8 that connects Delhi and Mumbai. The plant is located 60 km away from Ahmedabad, enroute to Mehsana.
Sources: Business Standard
The potato consumption of McDonald India is almost
entirely met by McCain Foods
34
GUJARAT FOOD & AGRO SECTOR – SUCCESS STORY
Desai Fruits and Vegetables (DFV)
Desai Fruits and Vegetables is re-engineering the Indian agro landscape by pioneering new techniques and concepts in farming & packaging to make available quality agro products to the world.
Sources: http://www.desaifv.com
• In 1999 - Ajit Desai, a simple farmer with a vision seeded an ambitious enterprise in Amadpore, a small village in Gujarat to tackle the problem of lack of proper facilities, infrastructure and counsel for the Agricultural sector in India. This movement is today redefining the norms and introducing world-class concepts in cultivating, packaging and supplying fruits and vegetables in India.
• DFV provides a wide range of high quality tropical fruits and vegetables. The product portfolio includes over 10 types of fruits and 30 types of vegetables. However, the key focus of DFV over the years has been on four key products: Banana, Mango, Pomegranate and Grapes.
• Desai Fruits and Vegetables has integrated pack houses located at Navsari and Bharuch in Gujarat and Baramati, Nasik and Karad in Maharashtra.
•farmers, DFV has created an eco-system that provides natural and fresh fruits and vegetables.
• In April 2006, Contract Farming India AG, a company based in Zug, Switzerland had taken up a strategic stake in Desai Fruits and Vegetables.
• DFV is certified to ISO 22000 and BRC standards. Also, its farmers are getting certified to Eurepgap standards. Mango and grapes farmers are already certified and all the pomegranate farmers are expected to be certified.
• The pack-house is APEDA recognized and enjoys IRW and WFLO memberships. The Company has been approved by China for Mango and enjoys protocol between APEDA and DCS.
With a group of over 2500 small and medium sized
35
GUJARAT FOOD & AGRO SECTOR – SUCCESS STORY
Riddhi Siddhi Group
Riddhi Siddhi Gluco Biols Ltd.(RSGBL) is one of the largest wet corn miller in India. RSGBL is known for innovations and excellence in the field of transforming Corn (maize) crop into essential industrial raw materials, adopting the most modern technologies.
• Incorporated in 1990, Riddhi Siddhi Gluco Biols Ltd is a
leading manufacturer of starch and starch derivatives. The
Company is promoted by the Ahmedabad-based
Chowdhary family, traditionally engaged in trading sago and
tapioca starch
• RSGBL owns four state-of-the-art strategically located plants
across India, at Gokak (Karnataka), Viramgam (Gujarat),
Puducherry (Pondicherry – UT) and Pant Nagar (Uttrakhand)
• RSGBL is an ISO 9001-2000 and ISO 22000 certified
organization
• The company is managed by more than 1600 employees; its
stocks are listed and actively traded in the stock exchange
• RSGBL has its export presence across 25 countries
• RSGBL has enhanced its installed capacity more than 20-fold
in 15 years - acquired two multi-national corn processing
units (Glaxo Smithkline and Hindustan Unilever)
French company Roquette Freres, one of
the largest maize starch manufacturing
companies in the world, has acquired a
14.9 % strategic stake in RSGBL
RSGBL production unit at Viramgam, Gujarat
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• In year 2003 Balaji Group introduced the biggest fully automated Potato processing machinery plant
in India which can process 4500 kg. potato and make 1200 kg. of chips per hour.
• Balaji has established a very strong network of distributors across the state of Gujarat, to ensure
supply of fresh products across the state within 24 hours.
• The company strongly believes in Value for Money strategy, ensuring great quality and taste and
distributing sufficient dealer margins
• Balaji Group largely focuses on continuous R & D, to keep their products suited to the changing
demands of the customers.
GUJARAT FOOD & AGRO SECTOR – SUCCESS STORY
Balaji Group
Balaji Group has pioneered the concept of potato wafers manufacturing by focusing on customers taste and requirements. The company has almost 90% market share of Gujarat’s wafers market and 70% market share of state’s namkeen (snacks) market.
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ADVANTAGE GUJARAT
438
GUJARAT – THE STATE WITH STRATEGIC LOCATION
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GUJARAT – INDIA’S ECONOMIC POWERHOUSE
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GUJARAT – ROBUST INFRASTRUCTURE
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GUJARAT – STRONG URBAN, SOCIAL AND EDUCATIONAL INFRASTRUCTURE
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GUJARAT – LAND OF INNOVATIVE HUMAN CAPITAL
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GUJARAT – NEW PARADIGM FOR INDUSTRIAL GROWTH
The current phase – involving Integrated development of large areas like SIRs,
PCPIR and DMIC – is poised to transform the industrial scenario in the state
Phase of industrial development
Leve
l of I
nteg
ratio
n
83 productclusters
202 IndustrialEstates
SEZs• Multi product• Chemical• Textile• Pharma• IT / ITeS• Electronics• Engineering• Biotech• Gems & Jewellery
Integrated large areadevelopments
• Special Investment Regions (>100 sq. km.) and Industrial Areas (50-100 sq. km.)
• CorridorDelhi Mumbai Industrial
• GIDC Industrial Estates• Petroleum, Chemicals and Petrochemicals Investment Region• Knowledge corridor• Logistics parks• Theme towns
Phase I Phase II Phase III Phase IV
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GUJARAT - PROACTIVE GOVERNANCE
Source: Socio-Economic Review Gujarat, 2011-12, Department of Economic affairs, March 2009
45
OPPORTUNITIES TO INVEST IN GUJARAT
46
DOING BUSINESS IN GUJARAT
547
OVERALL FRAMEWORK FOR DOING BUSINESS
48
TAX FRAMEWORK
49
EXCHANGE CONTROL REGIME
50
FRAMEWORK FOR SETTING UP INDUSTRY IN GUJARAT
51
KEY GOVERNMENT AGENCIES
6652
INDUSTRIAL PROMOTION FACILITATORS
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KEY CONTACT PERSONS
Department of Agriculture and Co-operation, Government of GujaratShri R. K. Tripathy Principal Secretary ,Department of Agriculture & Co-operationBlock No. 5, First floor, New Sachivalaya,Gandhinagar, Gujarat PHONE : +91-79-23250803
Gujarat Agro Industries Corporation Ltd.Shri. N.K. Singh, IFS,Managing Director, GAICKhet - Udyog Bhavan, Opp. Old High Court,Navrangpura, Ahmedabad - 380 014.PHONE : +91-79-2754 4741/42/43, +91-79-2754 0254 FAX : +91-79-2754 2518
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ndHead Office: Block No. 18, 2 Floor, Udyog Bhavan, GH-4, Sector 11, Gandhinagar 382 010 Gujarat, INDIA Phone: +91-79-23250492/93 Fax: +91-79-23250490
www.indextb.com, www.ic.gujarat.gov.in E-mail: [email protected] Regional Office: A-6, State Emporia Building, Baba Kharak Singh Marg, New Delhi 110 001, INDIA
Telefax: 011-23747002, 23360049 E-mail: [email protected]
For more details and online registration, log on to www.vibrantgujarat.com
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