Benefits of EXIM policy limited to large stakeholders, says study

Business Standard, August 22, 2011
Recommends capacity building for Orissa niger seed farmers.

The state and Central government must focus on capacity building and infrastructure to connect international markets to labour intensive and export oriented local markets for the betterment of farmers and artisans and create jobs, says a study conducted by Jaipur-based NGO, CUTS International.

Releasing the second phase study of its project named Grassroots Reachout and Networking in India on Trade and Economics (GRANITE), the NGO said the benefits of foreign trade policies were limited to large stake holders such as large farmers and producers and big export houses.

“The findings of the study revealed variable impacts across states and products. While products such as grapes in Nashik, Maharashtra and mangoes in Malda, West Bengal seemed to have drawn significant benefits, others such as spices in Orissa seemed to have not benefitted at all,” said the study.

In its detailed case study report, it was revealed that Orissa niger seed farmers are the least beneficiary of the export market since many middlemen and exporters involved in the trade take away a larger pie of the profit.

Niger seed is an oilseed and is also used as bird feed ingredient. India accounts for a third of global niger seed production at nearly 1 lakh tonne, out of which Orissa contributes the maximum at 40 per cent. US, Singapore, Mexico, Canada and Belgium buy niger seeds from India. The commodity is exported from Mumbai, Vishakhapatnam and Kolkata ports.

The study suggested capacity building programmes in the extensively growing areas of Bhawanipatna, Keonjhar, Kantabanjhi and Jeypore; such as creation of water harvesting in villages, providing training and equipment for value addition to the product.

“Such use may be promoted through appropriate government policies, including schemes under Foreign Trade Policy. To ensure that the growers get the advantage of the current boom in international market and not get exploited by traders and middlemen, community-owned marketing might be useful,” the report recommended.

The project covered turmeric and chillies in Andhra Pradesh, spices in Karnataka and Orissa, grapes in Maharashtra, chikan craft in Uttar Pradesh and gems and jewellery in Rajasthan.

While the study pointed out stark contrast regarding developments between literate grape farmers of Maharashtra and uneducated ginger and turmeric farmers of Orissa, it also criticized Central government funded schemes that has failed to deliver a desired impact.

“The inadequate availability of infrastructure in some states is also attributed by this study to the ineffective implementation of Assistance to States for Development of Export Infrastructure and Allied Activities (ASIDE) scheme,” the report said.

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