Dr Amit Mitra Secretary General Federation of Indian

Dr Amit Mitra Secretary General Federation of Indian Chambers of Commerce and Industry (FICCI) Rome 30 -31 May 2008

INDIA - Strong Macro Economic Fundamentals US $ 1 Trillion Economy Average Growth Rate (%)

INDIA - Strong Macro Economic Fundamentals Improving Fiscal Situation Fiscal Deficit

INDIA - Strong Macro Economic Fundamentals FDI Inflows on the Rise [US$ Million] Foreign Direct Investment (FDI)

INDIA - Strong Macro Economic Fundamentals Rapidly Increasing Global Trade [US$ Billion]

INDIA - Strong Macro Economic Fundamentals World’s Fourth Largest Foreign Exchange Reserves US $ 313 Billion as on April 25, 2008 Forex Reserves

INDIA - Agriculture Milk Largest Producer 91 Mn T Agriculture in India Contributes 18. 5% to the National GDP Cattle / buffaloes Largest in the world 283 million Provides Employment to Nearly 50% Workforce or F&V #2 in the world 129 Mn T 70% of Population Second Largest Arable Land in the World. Highest Fisheries Marine: 2. 7 Mn T Inland : 3. 1 Mn T Arable Land to Land Size Ratio Food Grains #2 in the world (218 Mn T) Largest Irrigated Land Network Favorable & Diverse Agro-climatic Conditions for a variety of crops Sugarcane # 2 in the world (245 Mn T) Goat & Sheep 182 million Tea Largest Producer (0. 85 Mn T)

INDIA - Agriculture Dominating Crops WHEAT RICE

INDIA - Agric ulture Food Grains Production (Million Tonnes) RICE TOTAL FOODGRAIN WHEAT COARSE CEREALS PULSES 2007 -08 figures pertain to III Advanced Estimates

INDIA - Agriculture Commercial Crops Production (Million Tonnes) OILSEEDS COTTON JUTE & MESTA 2007 -08 figures pertain to III Advanced Estimates Cotton – Million bales of 170 kg each SUGARCANE Jute & Mesta – Million bales of 180 kg each

INDIA – Agriculture Machinery Sector Need for Mechanization Total = 68% (207 M) Even though Agriculture still Supports the Majority of Indian Population, Yet Non-farm activities in rural areas are witnessing a rise in entrepreneurship and employment. As a result, number of people involved in agriculture is declining over the years. Crop Diversification Migration To Achieve Higher Productivity Monsoon Dependent (less Time lag Food grain production (Mt) : for Manual Operations) Acreage (M ha) : Labor/ area Tractor Pop. (M) Source: NSSO, 2005 : : Total = 60% (238 M) Total = 52% (250 M) 129 125 1. 6 0. 7 210 123 1. 9 2. 5 209 122 2. 0 3. 1

INDIA – Agriculture Machinery Sector Changing Focus on Agri-mechanization - Automation Percentage share of Power usage in Indian agricultural sector Source: Indiaagristat. com, Zinnov Research, 2007, Vision 2020 India, John Derre Total Power Consumption (k. W/ha)

INDIA – Agriculture Machinery Sector Comparison of Mechanization with Other Countries, 2003 Sl. Country No. Farm Power (k. W/Ha) No. of Tractors per 1000 Ha. No. of Combine Harvesters per 1000 Ha. 1. India 1. 36 15. 75 0. 026 2. Japan 8. 75 461. 22 236. 98 3. U. K. 2. 50 88. 34 8. 30 4. France 2. 65 68. 50 4. 93 5. Italy 3. 01 211. 08 4. 71 6. Germany 2. 35 79. 817 11. 41 7. Argentina -- 10. 74 1. 79 8. Brazil -- 13. 66 0. 915 9. China -- 6. 98 2. 53 10 Pakistan -- 16. 47 0. 08 11 Egypt -- 30. 70 0. 79 Source: FAO Yearbook 2003

INDIA – Agriculture Machinery Sector Indian Farm Equipment Market is expected to grow at a CAGR of ~5% Indian Agriculture Farm Equipment Market is now widely exposed to International Trade Favourable Factors: Monsoon Government Declared Prices for Crops Supportive Credit Policy of Banks

INDIA – Agriculture Machinery Sector Usage Trends of Major Farm Equipment

INDIA – Agriculture Machinery Sector Tractors Use of Tractors has witnessed an increase of more than 78% since 1994 There are nearly 13500 tractors per million hectares at present in India

Combines Migration - Rabi and Kharif Wheat- From Punjab & Haryana to MP and Maharashtra (till end of March) and then to Haryana and UP (till 10 th April). Return back to Punjab (by 15 Apr)

Combines Migration - Rabi and Kharif Rice & Soyabean-From Punjab & Haryana to MP and Maharashtra for Soyabean(till Oct 15) and then to Haryana and UP for Rice (till Oct end). Return back to Punjab (by 1 st week of Nov)

INDIA – Agriculture Machinery Sector Future Requirements of Farm Equipments Equipment for Seed Bed Preparation Sowing and Planting Roto Tillage Pneumatic Precision Planter Strip Till Drill Sugarcane Sett Cutter Planter Zero Till Drill Vegetable Transplanter Potato Planter & Rice Transplanter Plant Protection Equipments Irrigation Equipments Power Weeder Sprinkler Irrigation System Plastic Mulching Drip Irrigation System Electro Static Spraying Surge Flow Irrigation Orchard Sprayer Harvesting & Threshing Grain Combine Harvestor Strip Harvestor cum Reaper Windrower High Capacity Multicrop Threshor Mechanical Cotton Picker

INDIA – Agriculture Machinery Sector Agriculture Machinery Trade (Million US$) EXPORTS IMPORTS

Policy Mandate Requirement for Farm Mechanization Farm Power Requirement by 2020: 2 KW/Ha Removal of Regional Disparities Infrastructural & Institutional Framework Adequate Engineering Infrastructure at Implementation Levels Effective Training and Extension Service Repair & Maintenance Facilities Machinery Banks for Custom Hiring Services Credit at Simpler Terms Appropriate Farm Machines & Equipments For Small and Marginal Land Holdings Crop Specific & Quality Machines For Hill Agriculture Gender Specific

Policy Initiatives by the Government of India to Promote Farm Mechanization Training Establishment of Four Farm Machinery and Technology Training Institute (FMTTI) Demonstration Large Scale Demonstration of Equipment at Farmers Field Incentives for Purchase of Equipment Subsidy Through MMA, NFSM, NHM and Similar Other Schemes Available to all Categories of Farmers Incentives for establishment of Machinery Banks at Block Levels for Custom Hiring Services Identification of Machines Hill Agriculture Gender frienfdly Tools and Equipments Crop Specific Package of Machines

Policy Initiatives by the Government of India to Promote Farm Mechanization Manufacturing Sector De-reservation of Manufacturing of Agricultural Machines from Small Scale Sector Training on Manufacturing Technologies Introduced Quality of Machines Minimum Performance Standards for Tractors, Power Tillers & Combine Harvesters Framed Standard Specifications for All Machines Equipment Promotion Through Subsidy: Testing by FMTTI or BIS certification is mandatory Credit NABARD Refinance available & Financing Norms Simplified Agro Processing Sector Scheme on Post Harvest Technology Technologies Developed by ICAR / CSIR Promoted

Rome 30 -31 May 2008