Business / Industry Sectors
Agriculture MNCs upbeat about India’s business environment, want to invest more
19/11/2014
Agriculture and food remain a high priority for the new Indian government. The government is now looking for more foreign private partners.

Source: Hindustan Times

From commodity major Cargill to tractor manufacturer John Deere, foreign majors are upbeat about India's business environment and want to invest more in the agriculture and related sectors here, executives of these companies and foreign diplomats said. But to step up investment, they also want the government to address impediments such as frequent changes in tax rules and issues over food licensing and safety standards. 

Companies from the US, Canada, Australia, Israel, the Netherlands and several other European countries have strong presence in India's agriculture and food sector. These companies and governments in their home countries see more opportunity in transfer of best practices, linkages between scientific institutes, agriculture storage, cold-chain management, market access and productivity enhancement such as introduction of new technology in seed and plant biotech.


"Agriculture and food remain a high priority for the new government. The government now wants more private participation," said Siraj Chaudhary, mission co-lead for the food and agriculture mission to India under the US India Business Council. Chaudhary, who is also chairman of Cargill India, and representatives of US multinationals Abbott, Mondelcz International, Yum Brands and Dupont have recently met Agriculture Minister Radha Mohan Singh and Food Processing Minister Harsimrat Kaur Badal.

Chaudhary said while the government is making a pitch for manufacturing in India, they wanted to tell the government that US companies have already invested in India and would want to invest further. "The decision to invest in India is taken by teams here. The proposal is accepted from abroad based on the success of operation already. Therefore, making existing operations successful is the best motivator for getting more investment," he said.

Cargill, he said, sees big opportunities in procuring grain from farmers in India.

The business environment in the country is very conducive and supportive, said Mukul Varshney, vice president of corporate affairs at John Deere. "With global technology available, it is essential that companies look at localising them, thereby meeting the requirement of small farmers. John Deere has done that for cotton and sugarcane farmers and we will continue for other crops and value chain," he said.

Nicola Watkinson, minister commercial and senior trade and investment commissioner for South Asia at the Australian Trade Commission, said global companies would be successful in India if they start developing customised products for the market instead of pushing their own. "There is a huge gap between food and nutrition and Australian companies are eager to work in agri technology and dairy sector," she said. Australia is a key exporter of chickpea and lentils to India. Almonds, wine and farm equipment are among other agriculture and related imports from Australia.

Australian organisations such as Geraldton Fisheries Co-operative in fish processing, Profitable Dairy Systems in dairy management, sugar harvester company Bundaberg Mobile Equipment & Engineering and Gale Pacific which is into storage of grains are exploring opportunities to invest in India, she said.

According to Marie-Josee Charbonneau, counsellor and head of advocacy program at the High Commission of Canada, current trends such as global and regional economic integration, urbanisation and privatisation are major opportunities for companies working in agroindustries in both countries.

The burgeoning Indian food market has led to a number of Belgian companies, such as Agristo specialising in the production of frozen Belgian fries, to start actively exporting their products into the country. There have been several Indo-Belgian joint ventures as well, like Univeg from Belgium which recently collaborated with Mahindra & Mahindra to develop a fresh fruit supply chain.

The official spokesperson for the Belgium Embassy in India said business houses in that country are observing the recent political and economic developments in India with great interest. "There is hope for an improved economic environment in terms of predictable and stable tax environment, facilitation of procedures for foreign investors, and legislations that improve processes corresponding to ease of doing business in India. We are also looking forward to the effective implementation of the 'Make in India' campaign," the official said.

Chaudhary, the Cargill India chairman, said India's industrial laws need to be simpler so that everyone could follow them. "We are keen for GST (goods and services tax) implementation which will solve a lot of problem," he said.
Source: Economic Times

 

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