eChapters

Introduction

The availability of food depends on the production and distribution while the access to food is determined by an individual’s purchasing power. Thus, the food security in the framework of economic welfare is the situation in which the lowest income strata has a near zero probability of being vulnerable to famine and in terms of calorie it requires a near zero probability of falling below the poverty line (Rentlinger and Selousky, 1978). Therefore, food security concerns every sovereign country, especially the developing and poor nations, owing to its profound implications for their socio-politico-economic stability and which co-exists with international diplomacy. According to 1998 annual report of International Food Policy Research Institute (IFPRI), about 73 million people would be added to the world’s population every year between 19952020 increasing it by 32 percent to reach at 7.5 billion. Much of the population growth is expected to occur in the developing countries mainly in India where the population is expected to increase by 36 percent to touch at 1.27 billion by 2020 and is likely to overtake China by 2035. Therefore, meeting the food and nutrition needs of growing and urbanized population with rising incomes will have profound implications for agricultural production and food security of the country and Himachal Pradesh is no exception.

Introduction

India is more an agrarian economy, wherein about 50 percent of people directly depend on agriculture for employment. Like other developing nations, however, this country is facing some of the challenges like food insecurity, agricultural backwardness and unsatisfied farming community. Though green revolution in 1970s had brought much relief in this direction, liberalized trade polices since mid 1990s created new and complex issues, especially for small and marginal farmers. Also, since recent years the contribution of agriculture to GDP is declining, indicating that there is growth is shifting away from agriculture to industrial and service sectors. The rural-urban migration, primarily due to the poor employment absorption capacity of our traditional agricultural system, lower productivity, changing life styles, etc. is increasing at alarming rate. In spite of all these, the disparity persists within the society and across the region. Such inequalities, as measured through income distribution, consumption pattern and spending of the income, pose a big challenge, as the gaps are widening with the passage of time. Inadequate purchasing power among the poorer communities leads to undernourishment, which in turn affects their productive capacity. Even though huge food grain stocks are distributed among the needy, considerable proportion of the population lack economic access to such food, and have to rely upon the cheap and insufficient food.

Introduction

Food security problem has multiple dimensions that range from ensuring the food supply at global, country and local levels to create its effective demand round the year. The ultimate goal of an effective food security policy is to provide individuals with adequate dietary requirements through availability and accessibility of food, which are necessary conditions for nutritional well being. The level of food security existing in a country, however is a complex interactions, operating at different levels from the macro to the micro level. The components of the system would include international trade and macro policies, the agricultural sector, the market economy, consumption pattern, the micro economy or household income, urban-rural differentiation and gender issues, etc.

Food insecurity is a complex issue having several dimensions such as, poverty, unemployment, famine, gender discrimination, inequity, starvation, food and nutritional practices, for human growth, natural calamities and so on. Poverty has been recognized globally both as a cause and consequence of food insecurity. In the mid 1980s, 72 per cent of the world’s poor and 66 per cent of the world’s extremely poor lived in the Asia-Pacific region. In this region, 272 million people would suffer from chronic malnutrition during the next decade i.e. in the year 2010. In Asia-Pacific region, India alone has 204 million undernourished people, which is quite alarming when compared with neighbouring countries like China, which has only 164 million undernourished people despite being much populous than India. World Health Organization (WHO) report (1998) points out that health expectancy is more important than life expectancy. The impact of poverty and malnutrition on health has widened the gap between the rich and the poor.

Introduction

Agriculture provides unique solution to various developmental issues including poverty and hunger. World Development Report (2008) reveals that the agricultural growth has significantly contributed to the decline in poverty world over (as in China and Latin America). Though the non-agriculture sector pays more dividend, and grows steeply, the capital generated, however benefits a few (mostly urban areas) thus leading to uneven distribution of income. Whereas, the development of agriculture, which employs most of the rural population, is expected to benefit a large section of the population simultaneously and uniformly. It is in this context that this report predicts agriculture as a vital development tool for achieving Millennium Development Goal that calls for halving by 2015 the share of people suffering from extreme poverty and hunger.

Introduction

The diversifi cation and modernization of the present agricultural and other related activities supported by efficient on and off farm processing of the commodities for the purpose of value-addition is expected to increase food production and create employment and income generation. Adding value to food commodities after harvest is also aimed at minimizing the losses during storage and to maintain the quality of product. Efficient post-production practices, particularly the preservation and processing of agricultural and allied produces may bring a wide range of benefits to the people in this country, generating job opportunities by opening up village-level processing units. The goals of post-harvest and food processing technology are loss prevention as well as adding value to the harvested biomass, which result in more income to the farmers/processors and better quality produce provided to the consumers. Post-harvest and food processing technology are commodity-and location-specific and it is done at home, village and/or cottage levels at small and large industrial scale. On-farm post-harvest storage and primary processing integrated with production technology help to generate more employment opportunities and additional income for rural people. Minimization of the post-harvest losses is an important means to increase per capita food availability. It also helps to generate more employment and income. Investment in post-harvest measures is more economical and time saving than in productivity to obtain the same amount of a particular commodity. Furthermore, post-harvest measures automatically add value to the raw commodities as they pass on their marketing channels. Adoption of postharvest technologies and value additive measures are very strong tools for rural and social development through employment and income generation. Development and adoption of efficient value addition practices will enhance national food supply and sustain food security even at the household level. Fruits and vegetables processing industries have a good deal of potential in serving the rural economy. First, it helps in generating more employment for rural people. It will also check mobility of rural masses towards urban areas in search of employment. Employment opportunities offered by agroprocessing industries are plenty to the farm population and entrepreneur seeking self-employment. Cottage scale units particularly offer self-employment opportunities. Traditionally women handle food and are familiar with skills of food processing. In order to improve the status of living of woman and rural food processing, low cost appropriate fruit and vegetable processing technologies offer excellent opportunities for production of processed foods. The improvement of status of socially backward and landless labor classes will be possible only through providing non-farm employment at their doorsteps. This will generate a sense of security and confidence amongst rural people for overcoming uncertainty in agricultural income and providing self-employment to the land-less labor. The locally available untapped resources should be used effectively.

Introduction

The concept of food security having relevance at global, national, regional, state, household and individual level is well understood as a core issue over the last three decades in the world. The World Food Conference of 1974, organized in the wake of the world food crisis of 1972-74, was largely concerned with global food security. It was felt as the common responsibility of all nations that international approaches were needed to achieve the goal of improved world food security. The food security at national level means arrangements for providing physical supply of a minimum level of food during all periods including those having harvest failures. FAO (1983) had formulated that the basic concept of food security implied that all people at all times have physical and economic access to the basic food they need. The World Bank (1986) has modified this formulation to indicate that food security is access by all people at all times to enough food for an active healthy life.

In this direction, the conference on Environment and Development held in Rio (1992), the Joint FAO/WHO Conference on Nutrition held in Rome (1992), the World Conference on Human Rights held in Vienna (1993), the International Conference on Population and Development held in Cairo (1994), the World Summit on Social Development held in Copenhagen (1995), the Fourth World Conference on Women held in Beijing (1995), the Habitat II Conference held at Istanbul (1996), the World Food Summit held in Rome (1996), etc. deliberated on various facets of food security like food security and sustainable development, right for nutritionally fit and safe food, population growth and food production, global measures to satisfy the food needs, campaign against hunger, women in food production, rural-urban linkages and so on.

Introduction

Poverty has been described as a situation of “pronounced deprivation in well being” and being poor as “to be hungry, to lack shelter and clothing, to be sick and not cared for, to be illiterate and not schooled. Poor people are particularly vulnerable to adverse events outside their control. They are often treated badly by institutions of the state and society and excluded from voice and power in those institutions.” Lack of access to resources is a unifying characteristic of poverty in all its manifestations. The poor lack ownership of or access to assets such as land, water, forest, dwelling units, credit, literacy, longevity, voice and capital-both physical and social. Those who are severely below the poverty line are largely involved in subsistence type activities for which they get exploitatively poor returns despite suffering extreme physical hardship and undertaking grave risks so as to earn a meager income. Since earnings are below even the margins of existence, expenditure and survival needs exceed income. This often results in the need to borrow small amounts of money at usurious interest rates of as much as 120 per cent per annum (Mehta, 1996) when borrowing is not possible, hunger is suffered. Their inability to change the power relationships results in scarcely available common resources (such as even drinking water) or public funds meant for poverty alleviation being misappropriated and diverted through manipulation by the locally powerful or corrupt. Since there are no mechanisms for grievance redressal this could result in social tension, despair or a combination thereof.

Introduction

Food security means access by all people at all times to enough food for an active healthy life (Reuntlinger, 1985; World bank, 1986; FAO, 1989). But now-a-days, food security is used differently at national, regional and household level. At regional and national levels, it is related to regional and national balances between availability and need whereas at household level, it is related with food production resources, income available for purchases and assistance sufficient to meet the aggregate needs of all household members.

Availability of food alone may not guarantee access due to poor distribution or lack of purchasing power as co-existence of aggregate food self sufficiency and widespread malnutrition and hunger do exist. As per Chen and Kates, 1994, food security includes combination of criteria as:

Introduction

Food is the most important requirement of every section of the society. But, mere availability of food sometimes is not enough and it does not mean that everybody is having access to a fair share of it or that every one has an adequate diet (Oshaug et al., 1994). Therefore, affordable food prices and adequate purchasing power with the people are equally important.

The need of food security was felt due to the gaps in food production and availability of sufficient food from domestic resources. Large proportion of the underfed population starves not because of general food shortage but due to the insufficient access to food supplies or insufficient income to purchase food.FAO (1999) estimated that there were 20.4 million undernourished people in India only).

Importance of maintaining food security over the world has been abundantly recognized since long. However, during 1974, FAO was called by the World Food Conference to establish a Committee on World Food Security so as to keep the world food situation under constant review and to suggest the strategies for rectifying the problems in problematic areas. Later, an International Undertaking on World Food Security was set up wherein member nations committed themselves to maintain food stocks for ensuring uninterrupted supply of foodgrains and to cope up with the problems of shortage in case of crop failure due to the natural calamities etc. Since then, the Committee on World Food Security monitors the implementation of the undertaking.

Introduction

Food being the foremost basic need gets the priority in expenditure of people, especially poor class. Access to food demands affordability, which depends upon the twin factors namely, income of the people and prices prevailing in the country. Slower growth in income than prices would undermine the purchasing power, resulting in inadequate access to food and calorie consumption. Foodgrains account for about four-fifth of the calorie intake of the poor and an increase in cereal prices could significantly reduce the calorie intake of the poor, as it is sensitive to cereal prices.

Introduction

The importance of food security and its management world over has been recognized long back. The World Food Summit in 1974, called in response to the persistent and widespread under-nutrition and the future role of agriculture, stressed upon establishment of committee to review and recommend location specific action plan in sensitive areas. Asserting that every man, woman and child has the inalienable right to be free from hunger and malnutrition in order to develop their physical and mental faculties, an international undertaking on world food security was set up in which member nations committed to maintain food stocks to ensure routine and emergency food supplies (in case of crop failure, natural disaster, etc.). Monitoring the implementation of such undertaking has since then become the responsibility of the Committee on World Food Security.

Introduction

India has made impressive strides on the agricultural front during the past three decades. Much of the credit for this success should go to the several million small farming families that form the backbone of Indian agriculture and Indian economy. Policy support, production strategies, public investment in infrastructure, research and extension for crop, livestock and fisheries have significantly helped in increasing the agricultural productivity, food production and its availability. Notwithstanding these achievements, producing additional food with limited land, and providing economic access to food at the household level for ensuring food security would continue to be a major challenge for the nation. India has experienced considerable changes in the crop mix, yield and production since the inception of the Green Revolution. The Green Revolution phase displayed a high yield growth per unit of input. The first post-Green Revolution phase (from late-1960s to mid-1980s) was marked by the continued growth in returns from land through the intensification in use of chemical inputs and machine labour. The second post-Green Revolution phase (beginning the mid-1980s) was characterized by high input-use and decelerating productivity growth. It calls for an examination of the issues related to the trends in agricultural productivity, particularly with reference to individual crops in recent years. In the present paper, the temporal and spatial variations in the productivity status of major crops in India have been analyzed using the TFPG estimates. Some policy measures have also been suggested for sustaining TFP of the crops.

Role of Agriculture in Livelihood Systems

For the developing countries like India, where a majority of families, in both the farm and non-farm sectors, derive their livelihoods from agriculture, sustainability of agriculture cannot be discussed or even defined in isolation of the issue of livelihoods. Livelihood is defined as adequate stock and flow of food and cash with an individual or a family to meet its basic needs. Livelihood security then means secured ownership of, or access to, resources and income-earning activities, including reserves and assets to offset risks, ease shocks and meet contingencies. There are four principal ways of acquiring livelihoods by the rural households. First is the production-based livelihood. A large proportion of the small and marginal farmers gain livelihoods through production on small pieces of land. For these households, availability or access to inputs and improved methods of production are quite critical for their livelihoods. Second is the labour-based livelihood. Most of the small landholders and landless rural households derive livelihoods by selling their labour. For their livelihoods, demand for labour, wage rates and prices of food are the critical factors. Third is the exchange- or market- based livelihood. Those rural households which produce surplus food and non-food agricultural products or non-farm goods earn their livelihoods by selling these surpluses in the market. The marketing system for these products and relative prices of what they sell and what they buy, affect their livelihoods. The fourth set of livelihoods is transfer-based entitlements. The households without any income-earning asset or able-bodied person to work depend for their livelihoods on transfers from the government or other social organizations. Government’s social security and food assistance programmes are relevant for this group of rural households in fulfilling their livelihood requirements. The rural livelihood systems in the developing countries thus encompass a broad range of factors and depend on several macro sub- systems of the economy.

Introduction

India accounts for 16.7 per cent of the world’s food consumers. India’s size in terms of food consumers is many times larger than the average size of the rest of the countries, except China. At the time of independence in 1947, India was in the grip of a serious food crisis, which was accentuated by the partition of the country. The demand for food far exceeded supply, food prices were ruling at high levels and more than half of the populations were living below the poverty line with inadequate purchasing power. With high rates of population growth, the dependence on imported food increased further. However, the situation improved considerably after the mid-1960s, when new agricultural development strategy and food policies were adopted in the country. The production of staple cereals increased substantially, mainly contributed by productivity improvements. The dependence on food imports reduced and the country became a marginal net exporter of cereals. There was also an improvement in physical and economic access of households to cereals and other nutritive food products. The proportion of households reporting hunger went down and the incidence of economic poverty was reduced. The objective of this paper is to review the Indian approach to tackling the severe problem of food insecurity, which it faced immediately after independence. It reviews the evolution of food policy, the major policy instruments deployed, intervention in food marketing system, and the current status of food security/insecurity. The paper also identifies the lessons emerging from the experience of India. The paper has been divided into eight sections. The second section briefly presents the evolution of the food policy in India and the approaches to food security. The current status of food security and insecurity is analyzed in section 3. The next three sections detail the three major instruments of the food security policy. Price support policies pursued in the country are described in section 4. Section 5 examines the magnitude of input subsidies in Indian agriculture. Direct food and other assistance programs for improving household food and nutrition security and magnitude of food subsidy are presented in section 6, while some salient features of food marketing system that affect food security are given in section 7. Lessons emerging from the Indian experience are presented in the last section.

Executive summary

The enclosed project report envisages the setting up of a modern rice mill complex with attached parboiling facilities having an average processing capacity of 16 MT of paddy per day. The initial investment of the project is estimated to be Rs 480.17 lakhs. Sales Realization is assumed as constant for all the 7 years; amounted Rs 1129.2 lakhs. Pay Back Period for the project is estimated as somewhat more than 3 years. Internal Rate of Return for the project is 31%. Net Present Value is Rs.367.92 lakhs which is a positive value. It indicates that present value of cash inflows is greater than present value of cash outflows. Projected working results of the project throws light on its viability.

Once you have embarked upon the idea of doing (any) business, your concentration should be focused on doing things that should be relevant to maximizing returns and minimizing risks. Looking upon why businesses fail, one can find that it is usually because entrepreneurs are ill equipped to identify real business opportunities and take advantage of them, or they don’t anticipate and adapt critical changes or they fail to recognize or minimize real threats to business. Successful entrepreneurs are found to intensively pursue the path of planning by preparing business plans, for having foresight of critical incidents that would affect business and possible ways of action.

Introduction

Successful marketing is important to every business. Marketing is a critical tool for establishing awareness, attracting new customers and building lasting relationships. It is the process of planning and executing conception, pricing, promotion and distribution of your ideas, goods or services to satisfy the needs of individual consumers or organisations. It is as important to put adequate efforts on marketing your product or service, no matter whatever time you have dedicated to development of part of it.

We live in an electronic era, where the globe has shriveled into our fingertips. Customers are having lot of options to choose from. Information of what you need is reaching you within a click, that your decisions are often being guided by such information. Marketing uses communication and advertising tactics to persuade customers that your brand, including your products and services are exactly what they need. Marketing is thus crucial to your business which can have a bearing on the success rate and requires research, planning and appropriate budget allocations.

One of the important concepts in marketing is that of marketing mix. The elements of this mix are: product, pricing, physical distribution and promotion. Marketing management is that which optimizes the elements in the marketing mix, so that organisation is able to achieve its objectives while gaining customer utility. This chapter throws light on various aspects of marketing mix that an entrepreneur needs to focus upon to ensure success.

Introduction

Meat is a highly nutritious animal product relished by majority of the population in India. India produced around 6.2 million MT of meat in 2013 (FAOSTAT, 2013), standing at fifth position in world meat production and accounts for only 3 per cent of total meat production in the world (APEDA, 2017). Contribution of livestock sector to national economy in terms of gross domestic product (GDP) was 4.1 per cent in 2012-13 (Islam et al., 2016). The percentage of meat subjected to processing in India is only 1-2 per cent compared to 70 per cent in developed countries (Sen et al., 2013). Relatively higher proportion of poultry (7-8%) is converted into further processed poultry products. Major proportion of the meat produced in the country is derived from old and unproductive animals. Availability of spent birds is also on the rise due to the rapid growth in poultry industry. Meat from such animals and poultry has less desirable palatability attributes, especially tenderness, which makes it more suitable for processing into value added products. This will provide consumers with more acceptable, convenient, healthy and versatile products while simultaneously increasing the economic returns to the processor. The profitability of meat industry is critically dependent in deriving extra value from lower-value meat cuts. To achieve this, value must be added in the eyes of the consumer across the wide chain of value added products.

Introduction

Fish is a source of valuable animal protein and is considered a health food. This has resulted in increased consumer demand. Fish is now more expensive than meat and other animal foods. Being a highly perishable commodity, fish require immediate processing and various options are available for the value addition of fish. Fish processing, particularly seafood processing and marketing have become highly complex and competitive and exporters are trying to process more value added products to increase their profitability. Value can be added to fish and fishery products according to the requirements of different markets. These products range from live fish and shellfish to ready to serve convenience products. In general, value added food products are raw or pre-processed commodities whose value has been increased through the addition of ingredients or processes that make them more attractive to the buyer and/or more readily usable by the consumer.

Introduction

Consumption of milk is deeply rooted in our traditions, and it is an inevitable part of the Indian diet and even has ritualistic and medicinal uses. Milk is the first and one among the most nutritious foods that every mammal consumes on earth. It supplies all the nutrients needed to ensure proper growth and development in the postnatal period. Dairy foods in general are commonly considered balanced and nutritive, being frequently included as important components of a healthy diet (Pereira, 2014). Four components of milk are dominant in quantitative terms: water, fat, protein and lactose; while the minor components are minerals, enzymes, vitamins, and dissolved gases (Guetouache et al., 2014). On an average, bovine milk is composed of 87% water, 4 to 5% lactose, 3% protein, 3 to 4% fat, 0.8% minerals, and 0.1% vitamins. Milk and milk products contribute not only nourishment to the consumers, but also livelihood opportunities to farmers, processors, shopkeepers and other stakeholders in the dairy value chain.