Mumbai:
The ministry of finance is exploring possibilities to make the
Export-Import Bank of India (Exim Bank) a nodal agency to provide
long- and short-term financial assistance to agricultural export zones
(AEZs). With a view to provide remunerative returns to the farming
community in a sustained manner, the government, last year, had
announced AEZ schemes.
Sources close to the development said the government is planning to
provide financial assistance to AEZs in two different ways. One, with
the direct financial assistance of Exim Bank and the other by
canalising the Rural Infrastructure Development Fund (RIDF) through
Exim Bank.
It is learnt that the ministry has already asked Exim Bank to explore
these possibilities for AEZ financing. Sources said Exim Bank has
identified agriculture as a thrust area for growth and currently the
bank is working on various finance schemes for Indian agro-exporters.
Besides that, the government feels that since the AEZs are coming up
in rural India, funding of this can also be provided from the RIDF and
the gestation period for returns will be less for the AEZs than other
RIDF projects.
The government also wants to make Exim Bank a nodal agency for the
canalisation of the RIDF fund for the AEZs. The financing programme
will provide financial assistance for the development of the AEZs,
apart from creating additional infrastructural facilities, the sources
said.
Currently the government has been identified 10 AEZs, while 10 more
will be set up during the coming financial year. In Maharashtra, two
AEZs have already been identified at Aurangabad, for processing
grapes, and at Nagpur, for processing oranges.
According to a recent study conducted by Exim Bank, the Indian agro-processing
industry should adhere to international quality standards, like ISO
and Hazard Analysis Critical Control Points, to boost exports.
The agro- and food-processing sector ranks fifth in terms of its
contribution to Indias GDP and employs around 18 per cent of the countrys
industrial work force. Exports from the sector have gone up from Rs
2,821 crore in 1990-91 to an estimated Rs 10,770 crore in 2000-01, the
study said.
It added: "The agro- and food-processing sector holds significant
potential for Indias future development due to the ingredients it
has for promoting vital linkages between the agriculture and
industry."
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