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Rural Marketing System in the North Eastern States: Problems, Diagnosis and Strategy Perspective

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Rural Marketing System in the North Eastern States: Problems, Diagnosis and Strategy Perspective Rural Marketing System in the North Eastern States: Problems, Diagnosis and Strategy Perspective Content Chapter 1 : Introduction … 1 Chapter 2 : Agricultural Marketing system in North-Eastern States … 5 Chapter 3 : Rural Marketing system in Assam … 22 Chapter 4 : Rural Marketing system in Tripura … 38 Chapter 5 : Agricultural and Rural Marketing system in Meghalaya … 50 Chapter 6 : Perceptions of farmers on Rural Marketing … 60 Chapter 7 : Planning for Agri-processing entreprises in NE States … 79 Chapter 8 : Promoting Agribusiness Marketing Channels …130 Chapter 9 : Development of Marketing Infrastructure for Farmers …147 Chapter 10 : Summary and Recommendations …163 ACKNOWLEDGEMENTS This study has been conceived after initial discussions with Dr. R Srinivasan, Advisor (DP), Planning Commission, GOI on the request made by the Planning Commission to ASCI. We had prolific discussions with the senior government officials of all the states in the northeastern region during our course of study. We express our deep gratitude to Ms Somi Tandon and Dr. R Srinivasan Advisors of Planning Commission for giving all guidance during he study. We also express sincere thanks to Mr. S R Sarma, Deputy Advisor (DP) and Mr. C Laldinliana, Director ( SP-NE) of the Planning Commission who extended their cooperation during the study. Our thanks are due to Mr. T L Sankar, Principal ASCI and Dr. B S Chetty, Dean of Consultancy for extending all support in conducting this study . Rajagopal CHAPTER 1 INTRODUCTION Background of the Study The economy of the northeastern region is predominantly agriculture comprising agriculture and horticultural crops. The rural marketing is largely unorganized in the region and dominated by the private traders. The northeastern states have observed high production of fruits, spices and cashew in the recent past but could not fetch market price to the farmers at par with the markets in the other states. The topography of the NE states is not favorable for the movement of the products. Besides, the infrastructure, procurement practices, marketing approaches and processing facilities are also observed as the major constraints in the rural marketing in the NE region. The social and cultural taboos are also responsible to a large extent in not developing agro-industries in the region to provide better value addition to the horticultural crops. It is hence, necessary to diagnose the problems in the NE region for providing improved marketing environment and value added economic benefits to the farmers through better management of various post-harvest functions of the horticultural crops. The Planning Commission, Government of India, has awarded this study to Administrative Staff College of India. The study was conceived after holding discussions with the senior officials and Economic Advisor (DP), Planning Commission, Government of India, during his visit to ASCI. Scope of the Study The economy of the northeastern region is predominantly agriculture consisting of agriculture and horticultural crops. That the North-Eastern Region of India is an untapped reservoir of potential for development of horticulture is stating the obvious. Abounding in crops like Banana, Pineapple, Cashew, Citrus, Ginger and Onions Rural Marketing System in the Northeastern States 1 ASCI Consultancy which have high commercial valve before or after processing, the region seems to have already missed a great opportunity as Post-liberalized India is looking forward to penetrating international markets for some of Indian Horticultural products like grapes and mangoes as has happened in ports of Maharashtra, Andhra Pradesh and Karnataka. The rural marketing is largely unorganized in the region and dominated by the private traders. The northeastern states have high production of fruits, spices and cashew in the recent past but could not fetch market price equivalent to the other states. The topography of the NE states is not favorable for the movement of the products. Besides, the infrastructure, procurement practices, marketing approaches and processing facilities are also observed as the major constraints in the rural marketing in the NE region. The social and cultural taboos are also responsible to a large extent in not developing agro-industries in the region to provide better value addition to the horticultural crops. Therefore it is, necessary to diagnose the problems in the NE region, in order to provide improved marketing environment and economic benefits to the farmers through better post-harvest management of the horticultural crops. Context and Objectives of the Study In recognition of the vast scope that exists in the north eastern region for improving the socio-economic condition of the farmers through better post-harvest management of horticultural produce with specific emphasis on marketing, the study is designed covering three states of Assam, Meghalaya and Tripura. The specific objectives of the study will be as under: • To assess the existing infrastructure and policy support from the state and central government for post-harvest management and marketing of horticultural produce, Rural Marketing System in the Northeastern States 2 ASCI Consultancy • To study the existing practices for procurement, pricing and payments to the horticulture farmers on their produce and problems thereof. • To study the institutional arrangements and economic linkages across the area of study • To study the existing agro-processing network in terms of constraints related to capacity, productivity and overall viability, and • To suggest policy measures to overcome the constraints in the present system and identify areas for more in-depth study in future. Methodology The states of Assam, Meghalaya and Tripura are selected for the study. This diagnostic study is based on the available secondary data to be provided by the Planning Commission and the concerned State Governments. Detailed discussions were held with the senior officers heading departments/marketing institutions for horticultural development in the above states besides visiting selected marketing centres. Three districts namely Kamrup in Assam, East Garo in Meghalaya and North Tripura in Tripura states have been identified for the collection of primary data from the farmers. In all, 142 farmers in the selected districts have been covered under the study. The primary data has been collected by administering a pre-coded computerized schedule to farmers in an identified district of the selected states. This is an exploratory study in reference to the above objectives to find out the existing status of rural marketing in the region and suggest policy measures. Major Variables of the Study The major issues to be covered during the study will include major horticultural crops-area, production and yield, marketable surplus, marketing Institutions, infrastructure, logistics such as cold storage, warehouses, rural godowns, transportation; procurement pattern, pricing, processing infrastructure, packaging, retailing, marketing finance etc. Rural Marketing System in the Northeastern States 3 ASCI Consultancy Organization of the Report The report has been divided into Seven Chapters. The overview of agricultural marketing in the northeastern states has been presented in the Chapter II which discusses the scenario of agricultural marketing and major problems prevailing across the region. The profile of rural marketing pertaining to farm and non-farm sector is discusses in the Chapter Iii, IV and V for the states of Assam, Tripura and Meghalaya. These chapter delineate the general economy of the state, land use and cropping pattern, technology, extension services, agricultural and horticultural marketing practices, processing facilities marketing system of non-farm products and state plans for the promotion of rural markets. The perceptions of farmers based on the primary data in reference the marketing of farm and non-farm produce is discussed in Chapter VI. The Chapter VII presents the summary and recommendations of the study. Rural Marketing System in the Northeastern States 4 ASCI Consultancy Table – 1.1 Rice Total From 1984-89 State 1984-85 1989-90 1994-95 1997-98 2000-01 2004-05 Area 108 121.3 109.4 120 ARUNACHAL PRADESH Production 117.6 138.8 105.8 129.5 Yield 1088 1144 967 1079 Area 2324.8 2435.1 2450.5 2489.8 ASSAM Production 2438 2794.8 3309.1 3382.9 Yield 1049 1149 1350 1359 Area 167.4 162.4 158.9 157.9 MANIPUR Production 333 245.1 478.3 351.7 Yield 1989 1509 3010 2227 Area 111.4 104.4 103.2 157.9 MEGHLAYA Production 125.2 116.7 111.5 150.1 Yield 1124 1118 108 1427 Area 47.5 53 66.9 68.1 MIZORAM Production 40.9 59.2 100.2 110.6 Yield 861 1117 1498 1624 Area 120.9 127.4 136 145 NAGALAND Production 102.4 150 174 187 Yield 847 1177 1279 1290 Area 266 250.2 255.9 257.8 TRIPURA Production 373 459.1 413.9 535.8 Yield 1402 1835 1617 2078 Table –1.2 Rice Total From 1989-94 State 1989-90 1990-91 1991-92 1992-93 1993-94 Area 121.3 121.8 122 115.3 122 ARUNACHAL PRADESH Production 138.8 142.5 143.1 116.9 144 Yield 1144 1170 1173 1014 1180 Area 2435.1 2490 2527.7 2522.6 2525.7 ASSAM Production 2794.8 3270.2 3197.2 3299.7 3361.1 Yield 1149 1313 1265 1308 1331 Area 162.4 157.4 160.3 149.7 161.9 MANIPUR Production 245.1 274.2 340.5 269.3 346.6 Yield 1509 1742 2124 1799 2154 Area 104.4 103.6 104.5 104.2 104.2 MEGHALAYA Production 116.7 119.8 121.1 114 114 Yield 1118 1155 115.9 1094 1094 Area 53 51.3 55.6 61.3 62.5 MIZORAM Production 59.2 63.8 71 84 96.7 Yield 1117 1244 1277 1370 1547 Area 127.4 127.4 129 135 134
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