TN to introduce contract farming law soon

Our Bureau Chennai | Updated on March 15, 2018

Tamil Nadu Deputy Chief Minister and Finance Minister O Panneerselvam presenting the 2018-19 Budget in the State Assembly, in Chennai on Thursday   -  BusinessLine

Budget for 2018-19 lays thrust on agro processing sector

The Tamil Nadu government will soon enact a contract farming law to sustain agricultural production and promote agro-processing industries. It will also unveil a Food Processing Policy in 2018-2019 to create a conducive environment for healthy growth of the food processing industry.

The State Budget for 2018-19 presented by Deputy Chief Minister and Finance Minister O Panneerselvam today also proposes a major initiative in agro-processing sector with plans for an Ultra Mega Food Park on 450 acres at Pelakuppam village near Tindivanam.

Mega food parks

Panneerselvam said mega food parks will be set up in Theni, Virudhunagar, Thoothukudi, Erode, Cuddalore, Salem, Dindigul, Tirunelveli, Tiruvannamalai and Krishnagiri districts. These parks will become hubs for food processing isn fruits and vegetables, fisheries, dairy, poultry and meat by encouraging private investment and are expected to generate substantial employment in rural areas.

The State government allocated ₹8,916 crore in Budget Estimates 2018-2019.

Agriculture being a primary occupation of the substantial population of the State, the government is making efforts to enhance farmers’ income and farm productivity.

The Foodgrain Mission was launched in 2012-2013 to increase production by adopting modern technologies. The System of Rice Intensification will be promoted on 10 lakh hectares during 2018-2019.

Paddy procurement

Tamil Nadu procures paddy at ₹1,600 per quintal for common variety and ₹1,660 per quintal for fine variety. A sum of ₹200 crore will be provided as production incentive to cover the difference between the minimum support price (MSP) and the procurement price of paddy during 2018-2019.

To sustain pulses production, the State government will procure red gram, black gram and green gram from 2018-2019, directly from farmers through the Tamil Nadu Civil Supplies Corporation at MSP. The State government has fixed a target of 110 lakh tonnes of foodgrain production for the year 2018-2019, he said.

Crisis in sugar industry

Tamil Nadu will switch over to the revenue sharing price fixation model from the current season under which farmers will be assured of Fair and Remunerative Price (FRP) and will also receive a share in the profits over and above the FRP.

The sugar industry is cyclical in nature and is currently going through an extended phase of distress due to various factors such as failure of monsoons, varietal degeneration, reduced recovery, decline in area under sugarcane and the resultant reduction in capacity utilisation. This has, in turn, affected timely payments to farmers, he said.

Published on March 15, 2018

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