Nabard tells farmers to convert to ‘agripreneurship’

Agriculture in Kerala needs a makeover from a livelihood activity to business venture, leading to creation of a new class of ‘agripreneurs.’

This is one of the key observations made in the State Focus Paper for 2015-16 prepared by the regional office of the National Bank for Agriculture and Rural Development (Nabard).

Citing the dismal level of gross fixed capital formation at 5.3 per cent of GDP as against the national average of 17 per cent in 2009-10, it felt the need for promoting producer collectives in the State.

It noted that the state government has committed to transforming farmers from being mere producers to agripreneurs through the route of producer companies.

It also viewed with concern the declining trend in disbursement of investment credit over the last few years.

Nabard has specified funds that the state government may access suitably to tide over these two crucial issues, it said.

Intensive efforts to promote collective farming have not succeeded in the state due mainly to weak linkage to the banking system.

The banks are not able to proceed since the usage rights of the land are not available to them. The Kerala Land Reforms Act prohibits leasing of agriculture land.

The government should initiate steps to provide legal backing for transfer of usage right of land to lessees while protecting the ownership in the lines of Andhra Pradesh.

Digitisation of land records could be one solution for separation of usage rights from ownership rights.

As for infrastructure, at least 780 projects worth ₹3655.17 crore have been identified in various sectors related to agriculture. These could be posed to Nabard for consideration under relevant schemes.

Implementation of the Food Security Act in the state would require creation of additional storage capacity at taluk levels to ensure smooth supply of foodgrain through the public distribution system.

Here again, uncertainty in transfer of land for storage purposes or non-availability of land has been a major hurdle in creating the required capacity.

The Paper also observed that Rupay card-based kisan credit card is seen as the next-generation reform so that the state progresses from total financial inclusion to meaningful financial inclusion.

Meanwhile, the Nabard state credit plan for 2015-16 has estimated an exploitable credit potential of ₹1.08 lakh crore in the priority sector, which is 14 per cent more than previous year’s estimates.

The share of agriculture and allied sectors in gross state domestic product has declined steeply from 32.6 per cent in 1980-81 to 14.46 per cent in 2012-13. Of this, agriculture alone accounted for 11.8 per cent.