POWER sector financing company Power Finance Corporation (PFC) and Railways technical advisory wing RITES, on Thursday, signed an MoU to jointly import coal from countries, including Africa, to ease s

It's time for the government to reconsider its anti-poverty programmes.

UNION home minister Shivraj Patil is not in favour of allowing the use of agricultural land for setting up special economic zones (SEZs).

IN WHAT could transform into the biggest public-private joint venture in the power sector, public sector Bharat Heavy Electricals (Bhel) and Reliance Power (RPL) are exploring possibility of a tie

THE BJP has demanded that the Centre demonstrate that it was serious about ameliorating the condition of farmers by preparing a ten-year action plan for the revival of the sector.

Storage infrastructure and setting up processing facilities for our farm products are major issues and need immediate attention of policymakers to accelerate agricultural growth, says former power minister and MP, Suresh P Prabhu LACK of adequate infrastructure in the hinterland and poor connectivity are major reasons behind slow agricultural growth. Better communication infrastructure is urgently required to maximise benefits of scientific innovation in enhancing farm produce. Since there is a limit to expanding the farm land, I strongly believe that there is no alternative but to put together a credible agriculture infrastructure to meet the rising demand in India for foodgrains and other agri-products and also make decisive inroads into the external markets. Access to markets Beginning with physical road connectivity between the urban consumption markets to farmlands, setting up storage facilities to processing facilities for our farm products is one big issue that needs to be tackled by the policymakers in the country. Very often, I have witnessed heated debates in the Parliament on farmers' issues. Inadequate or lack of farm infrastructure is not limited to just India. It is a phenomenon in the entire South Asian region. Massive investments in building this infrastructure in agriculture and related farm-based industries are the only answer as we make efforts to maximise our productivity from the farmlands. Scientific research and technological innovations would make our investments more productive. Billions of dollars need to be set aside for laying rural roads, setting up cold storage, post-harvest processing units, quality and affordable inputs like seeds, fertilisers and water apart from undertaking massive diversification into horticulture, floriculture and allied areas like livestock, poultry development. Insulating Indian agriculture from vagaries of weather is another big challenge as the infrastructure for water storage, smooth flow up to farm-gate apart from ensuring judicious use needs emphatic focus. Only then the double-digit GDP growth envisaged during next five years would be possible. Common concern Farm infrastructure development assumes a lot of significance as the South Asian region led by India is home to 35% of the world's hungry and 40% of the world's poor. About 70% of these people belong to India. The country's borders with other South Asian countries are often porous for flow of agricultural inputs, products and human resources, but its formal trade, particularly its import with its neighbours, is not as intense. Authentic estimates corroborated by FAO figures project that the country's food production will exceed human food demand and sizeable surpluses of cereals, fruits and vegetables, potatoes and milk will be available, which will help strengthen the proposed South Asian Food Bank once the infrastructure bottlenecks are sorted out. As stated earlier, agricultural growth in recent years has thrown new sectors and regions into prominence. Livestock, fisheries, horticulture, specialty enterprises (spices, medicinal, aromatic, organic) and value-added products illustrate this trend. Market-driven diversification, emphasising the role of the private sector, in a global perspective, has become the new paradigm driving future agricultural growth. Alternative instruments and approaches are evolving to transform agriculture and a very important part of this

WORLD Bank on Tuesday launched a new catastrophe loan facility and revised an existing contingency credit line designed to help increase its business with middle-income countries. The World Bank board on Tuesday approved the Catastrophe Risk Deferred Drawdown Option that will give middle-income countries access to emergency funds in the event of a natural disaster such as a hurricane or earthquake. Countries stricken by disaster will be able to access funding of up to $500 million once a state of emergency is declared. Countries may qualify for the loan facility if they have a hazard risk management programme already in place that is monitored by the World Bank. World Bank president Robert Zoellick said the facility was an example of how the institution could be useful to middle-income countries, a diverse group that includes fast-growing economic powerhouses like China. In September, Mr Zoellick cut the price the World bank charged on its loans and simplified a complex set of fees and waivers for emerging economies, which were increasingly tapping global capital markets for funding. "These financial product enhancements reflect the World Bank Group's commitment to using creative ways to expand resources for our country partners,' Mr Zoellick said. "As our client relationships with middle-income countries become more sophisticated, the World Bank is responding with development solutions that share knowledge, build markets and institutions, and provide capital,' he added. The World Bank board separately also approved changes to its existing Deferred Drawdown Option (DDO), a pre-approved line of credit for countries which do not immediately need the funding but have access to it in the future in case of an unforeseen event. Only two countries

KOLKATA: The finance minister's farm loan waiver will help 1.10 lakh small tea growers become more competitive. Small growers contribute 25% to the national tea production, which stood at 940 million kg in 2007. The Budget has also abolished cash transaction tax, which was a burden to the tea industry in particular. "Nearly 80% tea estate workers do not have bank accounts and have to be paid in cash. For the tea industry, which is yet to come out of a crisis, this tax was an added burden,' Ambootia group chairman Sanjay Bansal said. There are 3 million direct workers in the country's tea estates. The estates also provide indirect employment to some 1.5 million people. The wage bill of the industry is around Rs 80 crore. The payment to workers are made on weekly, fortnightly or monthly basis.

A GLOBAL economic slowdown is underway. What began as a problem in a single sector in a single economy

It will provide only short-term relief THERE arefour crore small and marginal farmers who are unable to repay their crop loans to the banks. The Rs 60,000-crore budgetary allocation for waiving their loans will now enable a farmer to go back to the same bank, apply for another loan and await either of these two outcomes: a good crop or another loan waiver. While the gesture provides farmers relief in the short term, it would be harmful for the economy, especially the farm economy, in the long run. If we take the risk versus reward incentive out of an economic activity such as agribusiness, the enterprise quotient diminishes and hinders both growth and innovation.These key attributes, along with structural reforms and investment in agri-infrastructure, are needed to raise agricultural productivity and maintain the growth trajectory of the economy. The question we need to ask ourselves is why these farmers have not been able to repay their crop loans. Can Rs 15,000-per-farmer reward help them produce a better crop in the next season? The answer sadly is No. Small farmers face two main challenges: meeting their input needs (seeds, pesticides) and dealing with the weather risks to their crops. Issuance of input coupons for purchase of quality inputs for the next season would have been more beneficial. Bad weather plays havoc with agriculture. Dealing with weather risk calls for appropriate risk management tools such as weather insurance. This requires a network of weather stations at the block level for timely collation of data, a basic requirement for weather insurance products. Establishing a network of weather stations would have required only a fraction of the Rs 60,000 crore outlay. The budget will definitely encourage the creation of rural enterprises such as nurseries and cold chain establishment. The one-time budgetary assistance of Rs 75 crore for setting up mobile soil testing facilities is also a good step. However, the provision of Rs 60,000 crore for loan waiver which can at best provide short-term relief to farmers has robbed them of possible agri-infrastructure projects such as roads, marketing and storage facilities, and irrigation which could have yielded better returns on a sustainable basis. (*Country Head, Food & Agribusiness Strategic Advisory & Research) RAKESH TIKAIT Spokesman, Bhartiya Kissan Union It will not solve the deepening agri crisis THE Union budget 2008-09 is prima facie a pro-farmer budget, with the primary emphasis on writing off the loans of small and marginal farmers. It is a good step to provide instant relief to farmers who are heavily indebted, although it covers only 40% of total farmers. However, the debt relief will not solve the deepening agrarian distress. Nevertheless, we see the announcement of debt waiver as a victory of farmers' union, activists and pro-farmer media. It was a great battle and we are grateful that the finance minister took this step despite corporate pressure. We believe that this measure alone is not enough to address the farmers' problems. It is well known that the basic problem faced by farmers is their inability to get fair price for their produce. The policy makers have said nothing on this count. Nothing has also been said about ensuring better farm gate price for agriculture commodities or making available a price stabilisation fund to help farmers increase their income. The price offered for the commodities produced by them must not only fully cover their cost of production but also ensure livelihood security. Subsidy is another area of concern. Traders and producers are currently getting all the benefits while farmers have to suffer due to scarcity of fertiliser. The budget has also not made any announcement to strengthen the extension services of the ministry of agriculture to make it more relevant for the farmers. As a result, farmers are forced to depend on agents of pesticide and seed companies for technical advice. It seems that the government has made up its mind to hand over this system to the corporate sector. In this context, we are closely watching the Indo-US knowledge agreement and the multinational companies in seed business. In conclusion, although the budget is pro-farmer, the actual need of the Indian farmer is not just the removal of debt and interest. Many other important issues need to be addressed. These include access to market, fair price for produce, timely availability of fertilisers and seeds, direct subsidy and the public sector investment in agriculture business. We hope the government will consider all this in future. And the main need is to keep corporates far from farming business. K CHAKRAVARTHY Country Head* YES BANK