Agri Business

Organic products: Transition in trade for sustainable ecosystem

M Angamuthu | Updated on August 29, 2021

As consumers look more at personal health, wellness and nutritious, they are turning to organic foods

India is a treasure chest of biodiversity and has been home to several field and horticultural crops encompassing a stunning diversity in taste, nutrition, pest-resistance and, crucially in this age of climate change and natural disasters, adaptability to a range of conditions. The complexity with respect to soils, topography and climate has created an exceptional variety of bio-mass and specialized habitats within the country. Though the agricultural production of the country showed a tremendous growth with the green revolution technology, the indiscriminate use of chemical farm inputs has had adverse effect on the soil properties and also on the microflora and fauna. In order to reclaim the soil and it properties, the need for alternate options have emerged.

Organic agriculture is a production management system which promotes and enhances agro-ecosystem health, including biodiversity, biological cycles, and soil biological activity. It emphasizes the use of management practices in preference to the use of off-farm inputs, taking into account that regional conditions require locally adapted systems by using, where possible, agronomic, biological, and mechanical methods, as opposed to using synthetic materials, to fulfill any specific function within the system.

Lack of certification

Agricultural farming is being followed in many parts of the country by use of seeds adaptable to local conditions, by following crop rotation, using on-farm inputs for soil conditioning and pest and disease management, with better means for soil and water conservation etc. Though the principles of organic farming are being practiced in these farms, the absence of certification does not allow such products to be labeled as organic. In addition, the absence of an organized chain of custody limited the entry of products into major supply chains. It has also witnessed by the country that the system for certification and trade had been undertaken based on the Regulations of the importing countries, but with additional financial burden on the producers and exporters.

Considering the trade potential of Indian products in primarily developed countries, an institutional mechanism has been developed in the country and was notified in 2001 as National Programme for Organic Production (NPOP) under the Foreign Trade Development Regulations (FTDR) Act of Directorate General of Foreign Trade (DGFT).

The NPOP has been implemented since then under the overall guidance of Department of Commerce as the apex body, while Agricultural and Processed Food Products Export Development Authority (APEDA) functions as the Secretariat for its implementation. Thus, the regulatory system has been established in India primarily involving the plantation sector which was one of the organized agriculture trade sectors. However, as market penetration was successful for other products also in overseas markets, certification has expanded to other agricultural crops and products.

The NPOP has also paved way for certification of trade of minor forest produces as organic in addition to crop production ensuring balance and sustainability of the ecosystem. This has helped inclusion of parts of medicinal plant products such as stem, flower, bark, root, bud, fruit etc. in the organic basket.

Valued-driven activity

In most countries, certification in general is a value-driven activity leading to increased costs, which are finally reflected in the end product being exported. However, it has been ensured in NPOP that it gives opportunity to both private and Government organizations to create healthy competition and more opportunities, especially to the farmers. Thus, State Government organizations also function as Certification Bodies in addition to the private organizations based on the competence and system established for inspection and certification as per ISO 17065. At present, out of 32 certification bodies accredited under NPOP, 12 are State Government organizations which are eligible to operate anywhere in the country.

Though the certification system has been developed in the country, the biggest challenge had been to enroll the small and marginal farmers under the system. As they have been an integral part of the agricultural sector and to enable them also to meet the compliance to the requirements of the standard, grower group certification has been introduced under NPOP. Under this system, group of farmers collectively get certified in an affordable manner enabling them to supply adequate quantum of certified products. This has made a revolution in the Indian organic farming community as certification of cultivable land has expanded to almost all States and Union Territories. During 2020-21, 1.6 million farmers were certified under NPOP making India with the largest number of producers in the world. India has also attained the fifth position globally in terms of certified cultivable land.

Equivalency of NPOP

Having a National Regulation was not just the aim of NPOP as it does not guarantee entry of Indian products in any overseas market. Hence, negotiations have been initiated with the Governments of major importing countries for acceptance of NPOP. The European Commission and Switzerland granted equivalency to NPOP for unprocessed plant products which helped in enhancing the export of organic products without additional certification as per the Regulations of the importing countries. Indian organic products are permitted for export to Great Britain also under similar arrangement based on the equivalency with EU. Efforts are being undertaken in entering into recognition agreements with Taiwan, Korea, Japan, Australia, New Zealand, UAE etc.

Initially, NPOP has covered only the crops and processed food products, but the demand for other product categories facilitated development of production standards for organic livestock, poultry, aquaculture, apiculture etc. Meanwhile, there has been demand for organic animal feed in the organic livestock and poultry rearing sector of importing country resulting in inclusion under the scope of NPOP. Several other categories such as mushroom, seaweed, aquatic plants and greenhouse cCrops have also been included in NPOP. Recently, the processed form of Indian organic fibres and their products have been recently included along with organic cosmetics and personal care products on voluntary basis.

Conformity Assessment System has been developed under NPOP and the scheme is being established in the country by APEDA since its inception to regulate and monitor the export of organic products. However, of late, the NPOP standard has also been recognized for import of organic products into India and also for domestic trade.

Overcoming traceability hurdle

The wide range of products with varied cropping season and pattern managed by large number of growers in the country was a hurdle to demonstrate the traceability of each export consignment. However, this has also been overcome by implementing the first-ever global traceability system for organic products. The web-based traceability system, Tracenet, enables not only provides traceability but also acts as a tool to the Regulatory body for monitoring and surveillance of certified products.

Despite of the major milestones that have been achieved under NPOP, due to additional requirements of importing countries, the third party process certification under NPOP sometimes insists for product certification for few specific destinations. This makes the trade of Indian organic products more expensive and truly dependable on analytical methods.

Limited trade

With the efforts made in past two decades in developing and establishing the regulatory framework and entering into the recognition agreements with importing countries, India has been able to make remarkable record of $1.04 billion export during 2020-21 which was merely $13 million in 2002-03. The financial year has saw a 51 per cent increase in the export in terms of value compared to previous year. Despite of this, India is yet to broaden the horizon as presently trade is mostly limited to bulk commodities. To open up the possibilities for processed food sector, provisions have been made in the guidelines for the financial assistance scheme of APEDA to benefit the processors and exporters.

Consistent supply of raw material is yet another challenge for meeting the export demands. However, through various outreach programme and Buyer-Seller Meets, certified operators are being brought under one umbrella to meet the supply and demand.

Consumers are turning to organic foods as they look more closely at personal health, wellness and nutrition. However, India has been able to penetrate the overseas market by affirming the integrity and traceability of organic products. The amalgamation of the credible system and potential demand has created enhanced opportunities for Indian organic products due to which export has been made to 58 countries during 2020-21. India has been keeping its eyes for new destinations such as Vietnam, Israel, Chile, Malaysia, Australia etc and varied product categories mainly focusing on processed Fruits and Vegetables, Medicinal plant products, herbs, millets and health supplements etc. While fulfilling the ambitious dream of doubling the export, it is to ensure that the recognition of “India Organic” brand in the global market is also maintained by all the stakeholders.

(The author is Chairman, APEDA)

Published on August 29, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like