Date: June 25, 2020

Time: 7:00 pm India Standard Time (90 Minutes)

9:30 pm Singapore Time
2:30 pm BST
9.30 am EDT
LANDMARK REFORMS IN
INDIAN AGRICULTURE

agribazaar hosted a webinar on June 25 to discuss the impact of the ordinances promulgated
by the Indian government on the 5th of June, 2020. In the lead-up to this event, 9,543 people
from more than 50 countries registered for the webinar. It received valuable support from
government officials and the private sector. Sarat Mulukutla, CBO at agribazaar, introduced
the panelists and provided an overview of the themes of the webinar. The event, moderated
by Akhilesh Tilotia of Axis Bank, was commended for its smooth flow, equitable time
distribution between all participants, a live Q & A session and an interactive panel. Amit
Mundawala, MD of agribazaar, wrapped up the discussion and proposed the vote of thanks.

The panel comprised senior government officials, investors, developmental agencies, agri
industrialists and a banker. The reforms undertaken by the Government were outlined and
explained by the four Secretaries to the Government of India. These reforms have been
variously called the "watershed moment", "1991 moment", and the "unshackling" of Indian
agriculture, especially since they converted the Covid-19 crisis into a massive opportunity.

A good start with many reforms

With almost half a billion people associated directly or indirectly with Indian agriculture, any
change here impacts incomes, jobs, social status, and prosperity for them. These changes fit
in with the Government's commitment to doubling farmers' incomes. The three ordinances
change the Indian agri landscape by

1) Giving the Indian farmer more than one alternative to sell his produce outside the APMC
mandi system, and create a true ‘one nation, one market’ for agri produce. No monopoly of
APMC mandis at the local level means that the nation becomes one big market for the farmer
and digital platforms can connect farmers to buyers and processors nationwide.

2) Amending the Essential Commodities act, which will instil confidence in the private sector
for building large and modern storage facilities. It will also propel investments in building
more efficient food supply lines. Private entrepreneurs and investors now have many more
avenues to invest. No stock limits mean larger holding capacity, leading to bigger
warehouses and associated infrastructure for logistics and processing.

3) Encouraging contract farming. With the assurance of a price at the time of sowing, farmers
can take cropping decisions based on forward prices. Contract farming opens up the
possibility of land-pooling allowing small, fragmented farmers to come together to grow high-
quality food and cash crops. With these changes, scale will now be the key determinant of
success for Indian agriculture. Scale will require capital, technical know-how and supportive
regulations. Among other initiatives, the government of India has announced creation of
 Date: June 25, 2020
Time: 7:00 pm India Standard Time (90 Minutes)
9:30 pm Singapore Time
2:30 pm BST
9.30 am EDT
LANDMARK REFORMS IN
INDIAN AGRICULTURE

10,000 Farmer Producer Organisations, a digital agri stack and an agri infrastructure fund for
USD 13 billion.

An investor-friendly government

A fundamental shift in the thinking of the government was highlighted when it was mentioned
that the focus now is not on “managing the shortages” but on “processing the surplus”. This
was picked up by industry participants to highlight that the sector is now moving from being
"production-centric" to "demand-centric". The investors highlighted that it is now time to move
from subsidies to welcoming a wide range of capital (from debt to mezzanine to equity).

The government representatives committed to answering all the questions. Those that could
not be covered in the session will be addressed over email. The role of ‘Invest India’ in
promoting and facilitating foreign investment was highlighted and so was the concept of
‘Empowered Committees’. Many segments that are open for 100% foreign direct investment,
especially in the food processing sector, were highlighted.

On a specific ask for policy and government support on palm oil (one commodity in which
India is not self-sufficient), the government reached out to the industry to co-create
opportunities.

Opportunities identified

A wide range of opportunities were identified and highlighted including crop advisory, crop
marketing, smart irrigation, leasing of equipment, new avenues of financing, aggregation of
inputs and/or output chains, etc. Sectors like food processing and fisheries were highlighted
as "sunrise sectors".

The key mantra is that any industry needs to be able to compete in the global export market -
only then it can serve the local market efficiently. The world is now moving towards plant-
based products and India has a natural advantage in this market. India should set an
audacious target of US$100 billion of agri exports - the sector should look at all seven billion
people on the planet as its

customers and not just the one billion people in India. The animal husbandry market was
noted for the changing dietary preferences locally and globally.

Science and technology

The Indian farmer is very tech-savvy. Many of them quickly learnt and came on to the various
webinars and other apps that agri-input and agri-finance companies organized during the
lockdown. It was noted that the farmers are very flexible and willing to adapt to new ideas
and technology. Technology research in India still lagged many other countries. Many new
 Date: June 25, 2020
Time: 7:00 pm India Standard Time (90 Minutes)
9:30 pm Singapore Time
2:30 pm BST
9.30 am EDT
LANDMARK REFORMS IN
INDIAN AGRICULTURE

ideas in ag-tech are cutting-edge technologies like digital agri stack, gene editing, plant-
based meat, etc. India, with its fantastic agri research universities should step up to take
advantage.

Climate change is an area of concern and will require significant adaptation. Patterns and
intensity of rainfall are changing and that will impact the output of agriculture. Sustainability
must be kept in mind for long-term business models.

Some open areas

The initiatives of the Central government were lauded by all. However, some concerns were
raised on whether the States will be completely on board? Ideas like creating a GST Council
like body or moving agriculture to Concurrent List were highlighted. It was noted that 16
states have already started to issue their notifications in line with the central initiative.

Price is a key economic variable and one of the big reforms is to let price discovery take
place easily without any restrictions. However, it was pointed out that certain commodities
still operate under price control and the futures market still requires regulatory support for
development. It was noted that creating a robust price information system was a key initiative
of the government reforms. Unshackling of more sectors to make them sunrise sectors was
highlighted: key among them were palm oil and poultry.

Panelists

• Mr. Sanjay Agarwal, IAS, Secretary, Department of Agriculture, Cooperation & Farmers welfare,
Ministry of Agriculture and Farmers Welfare
• Ms. Pushpa Subrahmanyam, IAS, Secretary, Ministry of Food Processing Industries
• Dr. Rajeev Ranjan, IAS, Secretary, Department of Fisheries, Ministry of Fisheries, Animal
Husbandry and Dairying
• Mr. Atul Chaturvedi, IAS, Secretary, Department of Animal Husbandry and Dairying, Ministry of Fisheries,
Animal Husbandry and Dairying
• Mr. S. Sivakumar, Group Head - Agri & IT Businesses, ITC
• Mr. Balram Yadav, Managing Director, Godrej Agrovet
• Mr. Srini Nagarajan – Managing Director and Head of Asia, CDC
• Mr. Anuj Maheshwari, Managing Director, Agri business, Temasek International
• Mr. Akhilesh Tilotia, Head, Strategy and New Initiatives, Axis Bank (Moderator)