Business Plan-Organic Farm

BUSINESS PLAN FOR SETTING UP AN ORGANIC

FARM

Submitted by:

Under guidance of:

Prof.Anil Dubey Dupt.Director ABS, Lucknow

(DISSERTATION REPORT IN PARTIAL FULFILLMENT OF THE AWARD OF FULL TIME MASTERS IN BUSINESS ADMINISTRATION (INTERNATIONAL BUSINESS) 2008-10

AMITY BUSINESS SCHOOL

STATEMENT BY THE STUDENT

I here by state that this project is submitted in partial fulfillment for the requirements of MBA (IB) program of the AMITY UNIVERSITY, UTTAR PRADESH is an original research work carried out by me under the guidance and supervision of Prof.

Anil Dubey, Dupt. Director, AMITY BUSINESS SCHOOL ,LUCKNOW and the

thesis or any part has not been previously submitted. previously

Date.______________

Signature Signature Signature

Mohammad Ali Prof.Anil Dubey Prof. R P Singh

CERTIFICATE BY FACULTY GUIDE

Certified that this report is prepared based on the dissertation topic BUSINESS PLAN FOR SETTING UP AN ORGANIC FARM undertaken by Mohammad Ali Student of MBA(IB) 4th semester, AMITY BUSINESS SCHOOL, LUCKNOW CAMPUS in partial fulfillment of award of degree of Master Of Business Administration In International Business from AMITY UNIVERSITY, UTTAR PRADESH.

DATE:

FACULTY GUIDE:

Prof.Anil Dubey

ACKNOWLEDGEMENT

As a part of our course curriculum, I had to make a dissertation report on any topic to get the right exposure to the practical aspects of business management. I got an opportunity to work upon this topic, where I work on the project entitled BUSINESS

PLAN FOR SETTING UP AN ORGANIC FARM

Dedication, hard work and application are vital for achieving any goal but these are also awarded by guidance / co-operation and proper assistance. A number of persons have given their ideas and precious time to complete the report. I wish to express my heartfelt gratitude to the following individuals who have played a crucial role during my project. Without their active cooperation the preparation of this project could not have been completed within the specified time limit.

The first person I would like to acknowledge is my project guide Prof.Anil Dubey who, supported me throughout this project with utmost cooperation and patience. I am very much thankful to him for sparing his precious time for me and for helping me in doing this project.. He was a constant source of support during my research.

I would also like to thank Mrs. Charu Bisaria, coordinator for Dissertation for her help. I give my sincere thanks to my partners Shantanu Sing and Rahul Shankar, for giving me the opportunity and creating a nice work environment for me to complete my Business Plan report within the stipulated period of time. I would like to thank my parents for supporting me during my research.

Finally I thank Krishi Vigyan Kendra, Unnao, for their continued support in this project. This is a small contribution towards the greater goal.

Above all, I would like to thank THE ALMIGHTY for always helping me.

SYNOPSIS

The emerging global prospects for organic farm produce and the realisation of long-lasting damages caused to soils by chemical fertilisers and pesticides have propelled a shift to organic farming methods both in developed and developing countries. World wide, about 130 countries produce certified organic products on a commercial scale.

Reasons for the increase in organic food production are: market premiums of 2 to 2.5 times the conventional market price; an expansion in the consumer sector willing to pay the higher prices demanded by organic food; an expansion of markets in the developed world where Saskatchewan farm exports traditionally are targeted; and lower input prices due to organic production.

This document is a proposed business plan, with a financial model, for setting up

and operating an organic grain farm in Uttar Pradesh

The success of Farm would depend largely on a few factors. Such factors would include the successful organic certification for the year of production, maintaining the industry average yields for organic crops and receiving the premium prices expected. Failure of one or a combination of these factors would mean certain failure for the business. An angle that was not addressed in this business plan would be to diversify an existing traditional grain farm into organic production over a number of years. This approach would seem more logical as the owner would have previous experience in the farming industry. However, if the individual that is investing their equity is confident that all the criteria can be met and continually achieved, Oraganic Farm would be a successful endeavor when started up on its own.

OBJECTIVE

The objective behind setting up an organic farm is to attract and invite more farmers towards this form of farming. It is clear from current scientific researches and through environmentalists that use of chemical pesticides have been one of the major cause behind the deteriorating level of crop production, and let the farmers know that organic farming will not only enhance there crop production but also help in maintaining the land fertility as it uses the sustainable agricultural techniques. Moreover, organic farming is also the need of the hour as it now very well known that this kind of farming is environment friendly and can be a farmers input against the fight against global warming. The sum up of objectives is as

under:- To increase crop productivity

 To use sustainable crop production methods

 To switch over to natural and environment friendly methods of crop cultivation

The purpose of this study is to –

 To find out the prospects of establishing an organic farm in Uttar Pradesh.  To find out the benefits of establishing an organic farm in Uttar Pradesh.

CONTENTS

1. Students certificate

2. Certificate by Faculty Guide 3. Acknowledgement

4. Synopsis

5. Objective of the report

CHAPTER -1

9

1. Background 10

2. History 10

3. Significance of the study 14

4. Review of literature 15

5. Hypothesis 19

6. Problems and constrains 20

CHAPTER-2

26

CHAPTER-3

34

CHAPTER-4:

36

1. Organic farming around the globe 37

2. Organic farming in India 40

3. Organic farming gaining momentum 41

4. Organic farming in rural India 42

5. Need for organic farming 44

6. Methods 48 7. Industry statistics 52 8. Growth 54 9. Economics 55 10. Critical analysis 56 11. Progress 60 12. Procedure 64 13. Prospects 65

CHAPTER-5

:

72

1. Presentation of Business Plan 73

2. General Information 74

3. Production details 75

4. Miscellaneous Fixed Assets 76

5. Preliminary Expenses 76

6. Working Capital 76

7. Marketing 77

8. Target clients, Marketing strategy, Manufacturing Process 77

9. Pollution Control, Energy Conservation 78

10. Production Schedule, sales revenues 79

11. Raw material, Utilities, salary, repairs 81 12. Selling Distribution, Administrative Exp., Interest 82

CHAPTER-6

86

1. Conclusions 87

2. Recommendations

BACKGROUND

Organic farming

Organic farming is the form of agriculture that relies on crop rotation, green

manure, compost, biological pest control, and mechanical cultivation to maintain soil productivity and control pests, excluding or strictly limiting the use of synthetic fertilizers and synthetic pesticides, plant growth regulators, livestock feed additives, and genetically modified organisms. Since 1990, the market for organic products has grown at a rapid pace, to reach $46 billion in 2007. This demand has driven a similar increase in organically managed farmland. Approximately 32.2 million hectares worldwide are now farmed organically, representing approximately 0.8 percent of total world farmland. In addition, as of 2007 organic wild products are harvested on approximately 30 million hectares.

Organic agricultural methods are internationally regulated and legally enforced by many nations, based in large part on the standards set by the International Federation of Organic Agriculture Movements (IFOAM), an international umbrella organization for organic organizations established in 1972. IFOAM defines the overarching goal of organic farming as follows:

"Organic agriculture is a production system that sustains the health of soils, ecosystems and people. It relies on ecological processes, biodiversity and cycles adapted to local conditions, rather than the use of inputs with adverse effects. Organic agriculture combines tradition, innovation and science to benefit the shared environment and promote fair relationships and a good quality of life for all involved.."

History of organic farming

The history of organic farming dates back to the first half of the 20th century at a time when there was a growing reliance on synthetic fertilizers. The organic movement began in the 1930s and 1940s as a reaction to agriculture's growing reliance on synthetic fertilizers. Artificial fertilizers had been created during the 18th century, initially with superphosphates and then ammonia derived fertilizers

mass-produced using the Haber-Bosch process developed during World War I. These early fertilizers were cheap, powerful, and easy to transport in bulk. Similar advances occurred in chemical pesticides in the 1940s, leading to the decade being referred to as the 'pesticide era'.

Sir Albert Howard is widely considered to be the father of organic farming. Further work was done by J.I. Rodale in the United States, Lady Eve Balfour in the United Kingdom, and many others across the world.

As a percentage of total agricultural output, organic farming has remained tiny since its beginning. As environmental awareness and concern increased amongst the general population, the originally supply-driven movement became demand-driven. Premium prices from consumers and in some cases government subsidies attracted many farmers into converting. In the developing world, many farmers farm according to traditional methods which are comparable to organic farming but are not certified. In other cases, farmers in the developing world have converted for economic reasons . As a proportion of total global agricultural output, organic output remains small, but it has been growing rapidly in many countries, notably in Europe.

20th Century

Technological advances during World War II accelerated post-war innovation in all aspects of agriculture, resulting in large advances in mechanization (including large-scale irrigation), fertilization, and pesticides. In particular, two chemicals that had been produced in quantity for warfare, were repurposed to peace-time agricultural uses. Ammonium nitrate, used in munitions, became an abundantly cheap source of nitrogen. And a range of new pesticides appeared: DDT, which had been used to control disease-carrying insects around troops, became a general insecticide, launching the era of widespread pesticide use.

At the same time, increasingly powerful and sophisticated farm machinery allowed a single farmer to work over larger areas of land and fields grew bigger.

In 1944, an international campaign called the Green Revolution was launched in Mexico with private funding from the US. It encouraged the development of hybrid

plants, chemical controls, large-scale irrigation, and heavy mechanization in agriculture around the world.

During the 1950s, sustainable agriculture was a topic of scientific interest, but research tended to concentrate on developing the new chemical approaches. In the US, J.I. Rodale began to popularize the term and methods of organic growing, particularly to consumers through promotion of organic gardening.

In 1962, Rachel Carson, a prominent scientist and naturalist, published Silent Spring, chronicling the effects of DDT and other pesticides on the environment . A bestseller in many countries, including the US, and widely read around the world, Silent Spring is widely considered as being a key factor in the US government's 1972 banning of DDT. The book and its author are often credited with launching the worldwide environmental movement.

In the 1970s, global movements concerned with pollution and the environment increased their focus on organic farming. As the distinction between organic and conventional food became clearer, one goal of the organic movement was to encourage consumption of locally grown food, which was promoted through slogans like "Know Your Farmer, Know Your Food".

In 1972, the International Federation of Organic Agriculture Movements, widely known as IFOAM, was founded in Versailles, France, and dedicated to the diffusion and exchange of information on the principles and practices of organic agriculture of all schools and across national and linguistic boundaries.

In 1975, Fukuoka released his first book, The One-Straw Revolution, with a strong impact in certain areas of the agricultural world. His approach to small-scale grain production emphasized a meticulous balance of the local farming ecosystem, and a minimum of human interference and labor.

In the 1980s, around the world, various farming and consumer groups began seriously pressuring for government regulation of organic production. This led to legislation and certification standards being enacted through the 1990s and to date.

Since the early 1990s, the retail market for organic farming in developed economies has been growing by about 20% annually due to increasing consumer demand.

Concern for the quality and safety of food, and the potential for environmental damage from conventional agriculture, are apparently responsible for this trend.

21st Century

Throughout the history, the focus of agricultural research, and the majority of publicized scientific findings, has been on chemical, not organic farming. This emphasis has continued to biotechnologies like genetic engineering. One recent survey of the UK's leading government funding agency for bioscience research and training indicated 26 GM crop projects, and only one related to organic agriculture. This imbalance is largely driven by agribusiness in general, which, through research funding and government lobbying, continues to have a predominating effect on agriculture-related science and policy.

Agribusiness is also changing the rules of the organic market. The rise of organic farming was driven by small, independent producers, and by consumers. In recent years, explosive organic market growth has encouraged the participation of agribusiness interests. As the volume and variety of "organic" products increases, the viability of the small-scale organic farm is at risk, and the meaning of organic farming as an agricultural method is ever more easily confused with the related but separate areas of organic food and organic certification.

In Havana, Cuba, a unique situation has made organic food production a necessity. Since the collapse of the Soviet Union in 1989 and its economic support, Cuba has had to produce food in creative ways like instituting the world’s only state-supported infrastructure to support urban food production. Called organopónicos, the city is able to provide an ever increasing amount of its produce organically.

Significance of the study

There are three categories of opinions about the relevance of organic farming for India. The first one simply dismisses it as a fad or craze. The second category, which includes many farmers and scientists, opines that there are merits in the organic farming but we should proceed cautiously considering the national needs and conditions in which Indian agriculture functions. They are fully aware of the environmental problems created by the conventional farming. But many of them believe that yields are lower in organic cultivation during the initial period and also the cost of labour tends to increase therein. The third one is all for organic farming and advocates its adoption wholeheartedly. They think that tomorrow's ecology is more important than today's conventional farm benefits.

However, among many a major reservation, the profitability of organic farming vis a vis conventional farming, is the crucial one from the point of view of the Indian farmers, particularly the small and marginal.

Organic farming involves management of the agro-eco system as autonomous, based on the capacity of the soil in the given local climatic conditions. In spite of the ridicule poured out on organic farming by many, it has come to stay and is spreading steadily but slowly all over the world. India has been very slow to adopt it but it has made Inroads into our conventional farming system. One advantage we have here is the fact that the farming techniques practiced in this country before the advent of the green revolution were basically eco-friendly and they have not faded away from the memories of the present elder generation of our farming community.

India's options in finding out an alternative method to the conventional farming are limited. The World Trade Organization (WTO) deadline for banning exports of vegetables and horticulture products based on inorganic farming will expire in 2005. Sensing the importance, the Central and state governments have taken several initiatives to popularise organic farming in the country.

Review of Literature

Howard's (1940) Agricultural Testament draws attention to the destruction of soil and deals with the consequences of it. It suggests methods to restore and maintain the soil fertility. The study contains a detailed deposition of the famous Indore method of maintaining soil health. The reasons and sources of the erosion of soil fertility and its effect on living things are discussed. The criticism of the agriculture research and examples of how it had to be carried out to protect soil and its productivity are discussed in detail.

Bemwad Geier (1999) is of the opinion that there is no other farming method so clearly regulated by standards and rules as organic agriculture. The organic movement has decades of experience through practicing ecologically sound agriculture and also in establishing inspection and certification schemes to give the consumers the guarantee and confidence in actuality. Organic farming reduces external inputs and it is based on a holistic approach to farming. He describes the worldwide success stories of organic farming based on the performance of important countries in the west. The magnitude of world trade in organic farming products is also mentioned. To the question of whether the organic farming can feed the world, he says that neither chemical nor organic farming systems can do it; but the farmers can.

Save and Sanghavi (1991) are of the view that after their intensive experiments with organic farming and narrating the results to the informed, it is time that the governments and farmers are brought around. They firmly state that the economic profitability of organic farming can be proved. Four crops of banana grown by the natural way on the same farm by them are compared with those produced by the conventional way. While the natural farm yielded 18 kg of banana in the first round, the conventional one gave 25 kg. 30 kg was the yield at the second round on both the farms. However, on the third round, the natural farm gave 25 kg, the conventional one yielded only 20 kg. The results on the fourth round were stunning - the plants on the conventional farm died out; but the natural ones gave 15 kg on an average. Thus, the aggregate output was 88 kg on the natural farm and 75 kg on the conventional one.

While, the natural banana commanded a price of Rs 2.50 per kg, the conventional one could fetch only Rs 1.75 per kg. This has been the major reason for the substantial net profit (Rs 154) earned from the cultivation of natural banana (conventional banana could get only a net profit of Rs 26.25). The expenses incurred were Rs 66 and Rs 105 for the natural and conventional bananas respectively. However, a stringent cost and return analysis representing a larger sample size will be necessary to draw meaningful conclusions. It should be born in mind that the output obtained from the natural banana farm was also because of the accessibility to the inputs and expertise, which the authors happened to possess. Farmers placed in less advantageous positions may not derive such results. The price advantage to the natural organic farming products will also taper off when the supply increases. The environmental costs and returns have to be internalized and it is quite possible that the organic farming will prove to be a far better alternative to the conventional one. However, these aspects will have to be built into a scientific and tight economic reasoning, among others.

Kaushik (1997) analyses the issues and policy implications in the adoption of sustainable agriculture. The concept of trades off has a forceful role to play in organic farming both at the individual and national decision making levels. Public vis-a-vis private benefits, current vis-a-vis future incomes, current consumption and future growths, etc. are very pertinent issues to be determined. The author also lists a host of other issues. While this study makes a contribution at the conceptual level, it has not attempted to answer the practical questions in the minds of the farmers and other sections of the people.

Sharma (2001) makes a case for organic farming as the most widely recognized alternative farming system to the conventional one. The disadvantages of the latter are described in detail. Other alternatives in the form of biological farming, natural farming and perm culture are also described. The focus is on the organic farming, which is considered as the best and thus is discussed extensively. The work is not addressing the relevant issues in the adoption of organic farming on ground.

Veeresh (1999) opines that both high technology and sustainable environment cannot go together. Organic farming is conceived as one of the alternatives to conventional agriculture in order to sustain production without seriously harming the environment and ecology. However, he says that in different countries organic farming is

perceived differently. While in the advanced countries, its focus is on prevention of chemical contamination, we, in countries like India are concerned of the low soil productivity. Even the capacity to absorb fertilizers depends on the organic content of the soil. The principles of organic farming are more scientific than those of the conventional. India's productivity of many crops is the lowest in the world in spite of the increase in the conventional input use. The decline in soil nutrients, particularly in areas where the chemical inputs are increasingly being used in the absence of adequate organic matter is cited as a reason for low productivity. Doubts about the availability of massive sources of organic inputs also exist. He advocates an advance to organic farming at a reasonable pace and recommends conversion of only 70 per cent of the total cultivable area where unirrigated farming is in vogue. This 70 per cent supplies. only 40 per cent of our food production. While this analysis has several merits, it is more addressed to the policy makers and less to the farmers.

Sankaram Ayala (2001) is of the view that almost all benefits of high yielding varieties based farming accrue mostly in the short term and in the long term they cause adverse effects. There is an urgent need for a corrective action. The author rules out organic farming based on the absolute exclusion of fertilizers and chemicals, not only for the present, but also in the foreseeable future. There ought to be an appropriate blend of conventional farming system and its alternatives. The average yields under organic and conventional practices are almost the same and the declining yield rate over time is slightly lower in organic farming. The author also quotes a US aggregate economic model, which shows substantial decreased 5aelds on the widespread adoption of organic farming. Decreased aggregate outputs, increased farm income and increased consumer prices are other results the model gives. While the details about this US analysis are not known, its relevance to India where we already have the lowest yields of a number of crops under the conventional system appears to be open.

Singh and others (2001), recording the experiments on rice-chick pea cropping sequence using organic manure, found the yields substantially higher compared to the control group. Similar results were obtained for rice, ginger, sunflower, soyabean and sesame.

Ahn Jongsung opines that organic agriculture is economically viable (Anon, 1998). The author gives emphasis on marketing the organic products on the basis of reputation and credibility. In Japan, the farmers sell the produces directly to the consumers. The Kenyan farmers have seen that in organic farming, costs go down and profits increase. A farmer from UP who allotted a portion of his land exclusively for organic farming found that the yields of sugarcane, rice, wheat and vegetables were lower than those under chemical farming. An Englishman, settled in Tamil Nadu, who runs an organic farm in 70 acres planted with coffee, citrus, other fruits, rice, pepper and vegetables says that he does not earn a profit and does not have confidence in organic farming.

Somani and others (1992) have published a collection of 42 papers presented at a National Seminar on Natural Farming. Korah Mathen recounts several problems in evolving representative and rigorous yardsticks for comparison between modern and alternative farming. Yields cannot be compared, because of monoculture nature of chemical farming with those of multi crops raised under organic/natural farming. Economic analysis is also problematic because one has to quantify the intangibles. He advocated the resource use efficiency analysis. But the question of profitability of different systems of farming seems difficult to be examined in the absence of an economic analysis although the author does not rely upon it.

Save (1992) found that after three years of switching over to natural cultivation, the soil was still recovering from the after effects of chemical farming. When the soil regained its health, production increased and the use of inputs decreased. The farm, which was yielding 200 to 250 coconuts per tree, gave 350 to 400 per annum.

Rahudkar and Phate (1992) narrate the experiences of organic farming in Maharashtra. Individual farmers growing sugarcane and grapes, after using vermi compost, saw the soil fertility increased, irrigation decreased by 45 per cent and sugarcane quality improved. The authors say that net profits from both the sugarcane and grape crops are high in organic farms.

The foregoing overview of the literature makes it clear that opinions about organic farming are divided both among the farmers and experts. Disputes about the profitability and yield increases in organic farming are acute, but there Is a consensus on its eco-friendly nature and inherent ability to protect human health. There are

strong views for and against organic farming (the latter, mainly on the grounds of practicability of feeding a billion people, financial and economic viability, availability of organic inputs and the know-how). Those who are totally against it are prepared to ignore the ill effects of the conventional farming system. There are many who while approving organic agriculture, want a mixture of both the systems or advocate a careful approach by proceeding slowly towards the conversion of the conventional farms into organic. The questions about the yield and financial viability are crucial from the point of view of farmers; but they remain unanswered to a large extent. The study of a geographical area in the country endowed with a large number of resources for organic farming, but has not made any significant stride towards it, is also not found in the literature overview.

Objectives of the dissertation

 To understand the need for organic farming in India in the light of the experiences of other countries.

 To assess and evaluate the factors which may facilitate the adoption of organic farming in the country.

 To analyse the constraints, both political and social, and above all economic, in the introduction of organic farming in India.

Hypothesis

About 65% of India's cropped area is not irrigated and it can be safely assumed that high-input demanding crops are not grown on these lands. Fertiliser use on drylands is always less anyway as chemical fertilisers require sufficient water to respond. Pesticide use in these lands would also be less as the economics of these hardy or "not-so profitable" crops will not permit expensive inputs. These areas are at least "relatively organic" or perhaps even "organic by default". While neither of these terms necessarily denotes a healthy farm or a recommended agriculture system, it would at least imply a non-chemical farm that can be converted very easily to an organic one providing excellent yields and without the necessity and effort of a lengthy conversion period.

Problems and Constraints

The most important constraint felt in the progress of organic farming is the inability of the government policy making level to take a firm decision to promote organic agriculture. Unless such a clear and unambiguous direction is available in terms of both financial and technical supports, from the Centre to the Panchayath levels, mere regulation making will amount to nothing. The following are found to be the major problem areas for the growth of organic farming in the country:

Lack of Awareness

It is a fact that many farmers in the country have only vague ideas about organic farming and its advantages as against the conventional farming methods. Use of bio-fertilizers and bio pesticides requires awareness and willingness on the part of the farming community. Knowledge about the availability and usefulness of supplementary nutrients to enrich the soil is also vital to increase productivity.

Farmers lack knowledge of compost making using the modern techniques and also its application. Proper training to the farmers will be necessary to make vermi-compost on the modern lines. Attention on the application of composts/organic manure is also lacking. The organic matter is spread during the months when the right moisture level is absent on the soil. The whole manure turns into wastes in the process. The required operation is of course labour intensive and costly, but it is necessary to obtain the desired results.

Output Marketing Problems

It is found that before the beginning of the cultivation of organic crops, their marketability and that too at a premium over the conventional produce has to be assured. Inability to obtain a premium price, at least during the period required to achieve the productivity levels of the conventional crop is a setback. It was found that the farmers of organic wheat in Rajasthan got lower prices than those of the conventional wheat. The cost of marketing of both types of products was also same

and the buyers of wheat were not prepared to pay higher prices to the organic variety (Rao, 2003).

Shortage of Bio-mass

Many experts and well informed farmers are not sure whether all the nutrients with the required quantities can be made available by the organic materials. Even if this problem can be surmounted, they are of the view that the available organic matter is not simply enough to meet the requirements.

The crop residues useful to prepare vermi-compost are removed after harvest from the farms and they are used as fodder and fuel. Even if some are left out on the farms termites, etc destroy them. Experiments have shown that the crop residues ploughed back into soil will increase productivity and a better alternative is conversion into compost.

The small and marginal cultivators have difficulties in getting the organic manures compared to the chemical fertilizers, which can be bought easily, of course if they have the financial ability. But they have to either produce the organic manures by utilizing the bio-mass they have or they have to be collected from the locality with a minimum effort and cost. Increasing pressure of population and the disappearance of the common lands including the wastes and government lands make the task difficult.

Inadequate Supporting Infrastructure

The state governments are yet to formulate policies and a credible mechanism to implement them. There are only four agencies for accreditation and their expertise is limited to fruits and vegetables, tea, coffee and spices. The certifying agencies are inadequate, the recognized green markets are non-existent, the trade channels are yet to be formed and the infrastructure facilities for verification leading to certification of the farms are inadequate.

High Input Costs

The small and marginal farmers in India have been practicing a sort of organic farming in the form of the traditional farming system. They use local or own farm renewable resources and carry on the agricultural practices in an ecologically friendly

environment. However, now the costs of the organic inputs are higher than those of industrially produced chemical fertilizers and pesticides, including other inputs used in the conventional farming system. The groundnut cake, neem seed cake, vermi-compost, silt, cow dung, other manures, etc. applied as organic manure are increasingly becoming costly making them unaffordable to the small cultivators.

Marketing Problems of Organic Inputs

Bio-fertilizers and bio-pesticides are yet to become popular in the country. There is a lack of marketing and distribution network for them because the retailers are not interested to deal in these products, as the demand is low. The erratic supplies and the low level of awareness of the cultivators also add to the problem. Higher margins of profit for chemical fertilizers and pesticides for retailing, heavy advertisement campaigns by the manufacturers and dealers are other major problems affecting the markets for organic inputs in India.

Absence of an Appropriate Agriculture Policy

Promotion of organic agriculture both for export and domestic consumption, the requirements of food security for millions of the poor, national self-sufficiency in food production, product and input supplies, etc. are vital issues which will have to be dealt with in an appropriate agriculture policy of India. These are serious issues, the solution to which is hard and consistent efforts along with a national consensus will be essential to go forward. Formulation of an appropriate agriculture policy taking care of these complexities is essential to promote organic agriculture in a big way.

Lack of Financial Support

The developing countries like India have to design a plethora of national and regional standards in attune with those of the developed countries. The adoption and maintenance of such a regulatory framework and its implementation will be costly. The cost of certification, a major component of which is the periodical inspections carried out by the certifying agencies, which have freedom to fix the timings, type and number of such inspections appears to be burdensome for the small and marginal farmers. Of course, the fees charged by the international agencies working in India

before the NPOP were prohibitive and that was a reason for the weak response to organic agriculture even among the large farms in the country. No financial support as being provided in advanced countries like Germany is available in India. Supports for the marketing of the organic products are not forthcoming neither from the State nor from the Union governments. Also, the financial assistance extended to the conventional farming methods are absent for the promotion of organic farming.

Low Yields

In many cases the farmers experience some loss in yields on discarding synthetic inputs on conversion of their farming method from conventional to organic. Restoration of full biological activity in terms of growth of beneficial insect populations, nitrogen fixation from legumes, pest suppression and fertility problems will take some time and the reduction in the yield rates is the result in the interregnum. It may also be possible that it will take years to make organic production possible on the farm.

Small and marginal farmers cannot take the risk of low yields for the initial 2-3 years on the conversion to organic farming. There are no schemes to compensate them during the gestation period. The price premiums on the organic products will not be much of help, as they will disappear once significant quantities of organic farm products are made available.

Inability to Meet the Export Demand

The demand for organic products is high in the advanced countries of the west like USA, European Union and Japan. It is reported, that the US consumers are ready to pay a premium price of 60 to 100 per cent for the organic products. The upper classes in India are also following this trend as elsewhere. The market survey done by the International Trade Centre (ITC) during 2000 indicates that the demand for organic products is growing rapidly in many of the world markets while the supply is unable to match it.

India is known in the world organic market as a tea supplier and there is a good potential to export coffee, vegetables, sugar, herbs, spices and vanilla. In spite of the several initiatives to produce and export organic produces from the country, the

aggregate production for export came to only about 14000 tonnes. This also includes the production of organic spices in about 1000 ha under certification. Some export houses are also engaged in exporting of organic fruits, vegetables and coffee from India. The country could export almost 85 per cent of the production indicating that demand is not a constraint in the international markets for organic products.

Vested Interests

Hybrid seeds are designed to respond to fertilizers and chemicals. The seed, fertilizer and pesticide industry, are also the importers of these inputs to the country having a stake in the conventional farming. Their opposition to organic farming stems from these interests.

Lack of Quality Standards for Biomanures

The need for fixing standards and quality parameters for bio-fertilizers and biomanures has arisen with the increasing popularity of organic farming in the country. There are a very large number of brands of organic manures, claiming the high levels of natural nutrients and essential elements. But most farmers are not aware of the pitfalls of using the commercially available biomanure products. While the concept of organic farming itself lays great stress on the manures produced on the farm and the farmers' household, many of the branded products available in the market may not be organic. Elements of chemicals slipping into the manures through faulty production methods could make the product not certifiable as organic. Even if the farmers are using manure produced by different methods, proper parameters for biomanure are yet to be finalized. Most farmers are still unaware of the difference between biomanure and bio-fertilizer. While biomanure contains organic matter, which improves the soil quality, bio-fertilizers are nutritional additives separated from the organic material, which could be added to the soil, much like taking vitamin pills. Bio-fertilizers do nothing to enhance soil quality while the loss of soil quality has been the major problem faced by farmers these days.

Improper Accounting Method

Understanding the real costs soil erosion, human health and the loss of welfare of both humans and other living things, the computation of these costs are necessary to evaluate the benefits of organic farming. These costs will have to be integrated to a plan for the implementation of organic agriculture.

A recent study shows the inappropriateness of the cost and return accounting methods adopted to find out the economics of the organic farming (Prakash, 2003). An economic evaluation of the bad effects of inorganic agriculture and their internalization through environmental taxes is proposed for a market based approach to promote organic farming in India.

Political and Social Factors

Agriculture in India is subject to political interventions with the objectives of dispensing favours for electoral benefits. Subsidies and other supports from both the Central and state governments, government controlled prices of inputs like chemical fertilizers, the public sector units' dominant role in the production of fertilizers, government support/floor prices for many agricultural products, supply of inputs like power and water either free of cost or at a subsidized rate, etc are the tools often used to achieve political objectives. Any movement for the promotion of organic farming in India will have to counter opposition from the sections who benefit from such policies in the conventional farming system. The political system in a democracy like India is likely to evade the formulation of policies, which affect the interests of the voting blocks unless there are more powerful counter forces demanding changes. In the absence of alternative employment opportunities and other considerations, the organized workforce particularly in the public sector fertilizer, pesticide and seed industries is also likely to oppose moves on the part of the government to promote organic farming on a large scale.

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CHAPTER TWO

Company profile

The generation of idea

The rapid urbanization in the country has resulted in the declining progress in the agricultural sector due to which the current agricultural growth is at 4% where as the industrial growth rate is at 12% .To minimize the gap between the two sectors we need investment in the agricultural sector. Through this project we are planning to do the following things, which will ultimately result in overall growth of the agricultural sector along with the improvement in the lifestyle of the economically backward sector of the society.

1. We will take the agricultural lands on lease or some other feasible alternative by discussing with the owners of the land.

2. We will invest money to build a good agricultural infrastructure viz irrigation, power, modern equipments etc.

3. We will exploit the local unemployed villagers, train them in organic farming and make them engage in production process.

4. We will recruit people from various agricultural schools and colleges to improve this project and train local peoples

5. The production from the agricultural lands will be sold in the local market by opening various outlets.

6. The project gradually will become “Agricultural Park” which can be a source of a income by attracting the tourist and this is possible as government is now more concerned about the rural tourism in India.

THE PROMOTERS :

KRISHI VIGYAN KENDRA, Unnao.

Genesis of KVK

Taking the note of the developmental activities of PIRENS the Indian Council of Agricultural Research, New Delhi granted its sanction for establishment of the

Krishi Vigyan Kendra (the Farm Science Centre) in May 1992. However the actual implementation of its programmes could be started during March, 1993 only. Before launching its programmes and activities, a Benchmark survey of the selected villages was done to make a socio-economic appraisal and to understand the existing practices of the farmers. This enabled the KVK to identify the technological gaps and critical needs and requirements of the farmers. This formed the basis for framing operational modality like training, demonstration and on-farm-trials by the KVK. Simultaneously the farm development work was also started as an important requirement for the strengthening of training-cum-demonstration infrastructure of the KVK.

Initially the off campus training were given emphasis due to unavailability of infrastructure. However, since 1995, the on campus training has become a core activity of the KVK. Comparatively the demonstrations under the LLPs and FLDs took off on an earlier note during 1993-94.

Apart from conducting these demonstrations various innovative approaches were undertaken for providing the environment friendly packages to meet the farmer’s problem. An overwhelming response of the farmers to these eco-freindly practices later paved the way for forming various farmers interest groups and self help groups. The response to these groups organized under the domain of Krishi Vigyan Mandal further motivated the KVK to establish the Innovative Farmers Club in the year 1996. The club is an informal group of self experimenting farmers that provides an opportunity for sharing their innovations and practices among themselves. Further the KVK started the Innovative Farm Women's Club for involvement of farm women in the dissemination of various technological interventions at faster rate.

The KVK has excelled in bringing the modern technological packages at the farmers doorstep with the help of various instructional units. The KVK today has sufficient resources to impart training skills for not only the farmers but also the rural youth. The training schedule typically incorporates the existing needs and problems of the farmers for making a positive impact. The trainings are conducted both at the on-campus and off-campus locations. It invariably emphasizes on providing both the short term as well as long durational courses specifically to impart practical orientation to these courses. The KVK has started the instructional units for not only imparting the skills but also for providing the critical inputs as per the demand and need of the farmers. Wherever the response of the farmers to technologies under the Lab to Land Programmes and the on-farm-trials demonstrated by the KVK was multifold the need to take the assistance from the other funding agencies arose. The KVK took bold initiatives in convincing different State and Central Govt. funding agencies to provide the financial support

to undertake the innovative schemes and projects for further extending the extension programmes outside the purview of the KVK selected villages.

In the current scenario the mandates of the KVKs are as follows

Mandate

 Conducting “on-farm testing” for identifying technologies in terms of location specific sustainable land use systems (Technology Assessment and

Refinement).

 Organize training programmes to update the extension personnel with emerging advances in agricultural research on regular basis (In-service

training).

 Organize short and long-term vocational training courses in agriculture and allied vocations for the farmers and rural youth with emphasis on “learning by doing” for higher production on farms and generating self employment (Vocational training).

 Organize Front Line Demonstration on various crops to generate production data and feedback information (Front Line Demonstration).

Other Activities

 Formation of Farmers Commodity based Groups

 Conducting Monthly Zonal Workshop with extension functionaries  Rendering need based farm advisory services

 Implementing State and Central Governments sponsored agriculture related development programmes

 Developing location specific technologies  Conducting skill demonstrations

 Dissemination of technologies through AIR, Doordharsan, Websites and Newspapers

 Precision Farming, National Horticulture Mission, ATMA, IAMWARM, etc.

TYPE OF PRODUCT/SERVICES

Type of the Project: Production of agricultural food items and rendering services to

the rural society

Product/Services description (Type, Quality & uses): The rapid urbanization in the

country has resulted in the declining progress in the agricultural sector due to which the current agricultural growth is at 4% where as the industrial growth rate is at 12% .To minimize the gap between the two sectors we need investment in the agricultural sector. Through this project we are planning to do the following things, which will ultimately result in overall growth of the agricultural sector along with the improvement in the lifestyle of the economically backward sector of the society.

1. We will take the agricultural lands on lease or some other feasible alternative by discussing with the owners of the land.

2. We will invest money to build a good agricultural infrastructure viz irrigation, power, modern equipments, sustainable agricultural techniques, etc.

3. We will exploit the local unemployed villagers, train them in organic agricultural techniques and make them engage in production process.

4. We will recruit people from various agricultural schools and colleges to improve this project and train local peoples.

5. The production from the agricultural lands will be sold in the local market by opening various outlets.

6. The project gradually will become “Agricultural Park” which can be a source of a income by attracting the tourist and this is possible as government is now more concerned about the rural tourism in India.

SWOT-ANALYSIS OF INDIAN ORGANIC AGRICULTURE

(DOMESTIC AND EXPORT MARKET)

Organic farming is one such part of agriculture sector which is unexploited yet, especially in the state of Uttar Pradesh. The projects strength, weaknesses, opportunities and threats are discussed as

below-Strengths:

The export of Indian organic products is progressing. The Government support to organic agriculture, awareness for healthy food harmful effects of pesticides and presence of their residues. International and national certification bodies in India – these four facts are the dominating strengths. The supply (quantity, not considering the quality) is certainly not the bottle neck for further development of OA in India.

Weaknesses:

Major weaknesses are on the level of information/awareness: most farmers have only small holdings and quality consciousness is low besides lack of marketing skills (e.g. disjointed sector for the domestic market). Another weakness to be noted is that the organic market is not onsumer demand -based, but supply driven. From this fact a lot of threats can be derived. For the success of the organic market, powerful, well organized and consumerbased farmer organizations are certainly very important.

Opportunities:

To quantify the potential of the organic products is not simple because the fast development of the Indian society and economy. For further progress, more information should be gathered on the market opportunities. Nevertheless, the need assessment shows that on the level of the opportunities, a considerable potential for the organic market exists, even though the size of the potential can not be quantified exactly. There is a consensus within the Indian organic agriculture sector (private and government) that an interface organisation is needed to provide information and services. The founding of the Indian Competence Centre of Organic Agriculture is a promising initiative for this and can serve as a platform for various activities related to market development (as given in Business Plan of ICCOA).

Threats:

Some of the major threats are really dangerous. The awareness about pesticide residues is to be considered as strength. However, a bigger threat is that all kind of products are offered under declarations like “without pesticides”, “eco-friendly” or even “organic”. In this sense most threats are related to the problem of faithful declaration, role of government, and clarification of the term “organic”. These threats should be quickly overcome; otherwise the Indian organic market might fail before it has even started off.

CHAPTER THREE

Methodology

The paper is based on secondary data. Information from literature on the historical evolution of the organic farming and the progress it has made both in India and abroad collected from the published sources like the websites of the European Union countries. International Federation of Organic Farming Movements (IFOAM), books and periodicals and news paper reports is liberally used for the preparation of the paper.

This study used the analytical research design, as it was not intended to develop or defend any particular hypothesis. In Analytical Research design, research is done on the basis of already available facts or information to make a critical evaluation.

Sample Size:

I had done documentary observation to rearch up to the result so there is no need of sample size.

AREA:

CHAPTER FOUR

Organic farming- a global picture

The following information is taken from the 2009 edition of the yearbook "The World of Organic Agriculture", published by the International Federation of Organic Movements IFOAM, the Research Institute of Organic Agriculture FiBL and the International Trade Centre ITC.

According to the latest survey on organic agriculture, carried out by the Research Institute of Organic Agriculture FiBL and the International Federation of Organic Agriculture Movements IFOAM, organic agriculture is developing rapidly, and statistical information is now available from 141 countries of the world. Its share of agricultural land and farms continues to grow in many countries. The main results of the global survey on certified organic farming show that 32.2 million hectares of agricultural land are managed organically by more than 1.2 million producers, including smallholders (2007). In addition to the agricultural land, there are 0.4 million hectares of certified organic aquaculture. Global demand for organic products remains robust, with sales increasing by over five billion US Dollars a year. Organic Monitor estimates international sales to have reached 46.1 billion US Dollars in 2007 (FIBL, IFOAM, ITC 2009).

Africa

In Africa, there are almost 900’000 hectares of certified organic agricultural land (end 2007). This constitutes about three percent of the world’s organic agricultural land. The countries with the most organic land are Uganda (296'203), Tunisia (154'793 Hectares), and Ethiopia (140’308 hectares). The highest shares of organic land are in Sao Tome and Prince (5 percent), Uganda (2.3 percent) and Tunisia (1.6 percent). The majority of certified organic produce is destined for export markets, with the large majority being exported to the European Union, which is Africa’s largest market for agricultural produce. The African market for organic products is still small. Three countries have an organic regulation and seven are in the process of drafting one. A first African Organic Conference will be held in Kampala, Uganda, from May 19-22, 2009. (FIBL, IFOAM, ITC 2009).

Asia

The total organic area in Asia is nearly 2.9 million hectares. This constitutes nine percent of the world’s organic agricultural land. 230’000 producers were reported. The leading countries are China (1.6 million hectares) and India (1 million hectares) The total organic area in Asia is nearly 2.9 million hectares. This constitutes nine percent of the world’s organic agricultural land. 230’000 producers were reported. The leading countries are China (1.6 million hectares) and India (1 million hectares). The highest shares of organic land of all agricultural land are in Timor Leste (seven percent). Organic wild collection areas play a major role in India and China. Production of final processed products is growing, although a majority of production is still fresh produce and field crops with low value-added processing, such as dry or processed raw ingredients. Aquaculture (shrimp and fish) on the other hand, is emerging in China, Indonesia, Vietnam, Thailand, Malaysia and Myanmar. Textiles is another important trend. Sector growth is now also driven by imports, and local markets have taken off in many of the big cities in the South and Eastern part of region besides Japan, South Korea, Taiwan and Singapore. Kuala Lumpur, Manila, Bangkok, Beijing, Shanghai, Jakarta, Delhi, Bangalore and other cities are increasing internal consumption of organic products. Nine organic regulations are in place. In seven countries work on national standards and regulations is in progress.(FIBL, IFOAM, ITC 2009).

Europe

As of the end of 2007, 7.8 million hectares in Europe were managed organically by more than 200'000 farms. In the European Union, 7.2 million hectares were under organic management, with more than 180’000 organic farms. 1.9 percent of the European agricultural area and four percent of the agricultural area in the European Union is organic. Twenty-four percent of the world's organic land is in Europe. The countries with the largest organic area are Italy (1'150'253 hectares), Spain (988'323 hectares) and Germany (865'336 hectares). The highest percentages are in Liechtenstein (29 percent), Austria (13 percent) and Switzerland (11 percent).

Compared to 2006, organic land increased by more than 0.3 million hectares. Sales of organic products were approximately 16 billion Euros in 2007. The largest market for organic products in 2007 was Germany with a turnover of 5.3 billion Euros (2008: 5.8 billion Euros), followed by the UK (2.6 billion Euros), France and Italy (both 1.9 billion Euros). As a portion of the total market share, the highest levels have been reached in Austria, Denmark and Switzerland, with around five percent for organic products. The highest per capita spending is also in these countries. Support for organic farming in the European Union and the neighboring countries includes grants under rural development programs, legal protection and a European as well as national action plans. One of the key instruments of the European Action Plan on organic food and farming, an information campaign, was launched during 2008, with the aim of increasing awareness of organic farming throughout the European Union. Furthermore, most EU member states have national action plans. In order to boost organic farming research, a technology platform joining the efforts of industry and civil society in defining organic research priorities and defending them vis-à-vis the policy-makers was launched in December 2008. The platform’s vision paper reveals the potential of organic food production to mitigate some of the major global problems from climate change and food security, to the whole range of socio-economic challenges in the rural areas).(FIBL, IFOAM, ITC 2009).

North America

In North America, almost 2.2 million hectares are managed organically, representing approximately a 0.6 percent share of the total agricultural area. Currently, the number of farms is 12'064. The major part of the organic land is in the US (1.6 million hectares in 2005). Seven percent of the world’s organic agricultural land is in North America. Valued at more than 20 billion US Dollars in 2007 (Organic Monitor), the North American market accounted for 45 percent of global revenues. Growing consumer demand for healthy & nutritious foods and increasing distribution in conventional grocery channels are the major drivers of market growth. The U.S. organic industry grew 21 percent in sales in 2006, and was forecast to experience 18 percent sales growth each year on average from 2007 through 2010. Whether this rate will actually be realized is uncertain due to the economic downturn and reduction in

consumer spending in the last quarter of 2008. Likewise, a downturn is expected in Canada, even though the market growth in Canada, paired with the introduction of the new organic regulations, should provide a good outlook over the coming years. In the United States, the National Organic Program has been in force since 2002. Canada has had a strong organic standard since 1999; this had been, however, voluntary and not supported by regulation. Canada’s Organic Product Regulation will be fully implemented on June 30, 2009. Canadian labeling requirements will very similar to those of the US and the EU. In 2008, the new Farm Bill was passed by the US Congress. Increasing expenditures on organic agriculture and programs to approximately 112 million US Dollars1 over the course of its five-year life, the 2008 Farm Bill provides a five-fold increase for the organic sector compared with federal funding in the previous bill.(FIBL, IFOAM, ITC 2009).

Latin America and the Caribbean

In Latin America, 220’000 producers managed 6.4 million hectares of agricultural land organically in 2007. This constitutes 20 percent of the world’s organic land. The leading countries are Argentina (2'777'959 hectares), Brazil (1'765'793 hectares) and Uruguay(930'965 hectares). The highest shares of organic agricultural land are in the Dominican Republic and Uruguay with more than six percent and in Mexico and Argentina with more than two percent. Most organic production in Latin America is for export. Important crops are tropical fruits, grains and cereals, coffee and cocoa, sugar and meats. Most organic food sales in the domestic markets of the countries occurs in major cities, such as Buenos Aires and São Paulo.

Fifteen countries have legislation on organic farming, and four additional countries are currently developing organic regulations. Costa Rica and Argentina have both attained third country status according to the EU regulation on organic farming. In recognition of the growing importance of the organic sector to Latin America’s agricultural economy, governmental institutions have begun to take steps towards increasing involvement; governments are beginning to play a central role in the promotion of organic agriculture. The types of support in Latin American countries range from organic agriculture promotion programs to market access support by

export agencies. In a few countries, limited financial support is being given to pay certification cost during the conversion period.

An important process underway in many Latin America countries is the establishment of regulations and standards for the organic sector (FiBL, IFOAM, ITC 2009).

Oceania

This region includes Australia, New Zealand, and island states like Fiji, Papua New Guinea, Tonga and Vanuatu. Altogether, there are 7'222 producers, managing almost 12.1 million hectares. This constitutes 2.6 percent of the agricultural land in the area and 38 percent of the world’s organic land. Ninety-nine percent of the organically managed land in the region is in Australia (12 million hectares, 97 percent extensive grazing land), followed by New Zealand (65’000 hectares) and Vanuatu (8'996 hectares). The highest shares of all agricultural land are in Vanuatu (6.1 percent), Samoa (5.5 percent) and the Solomon Islands (3.1 percent). Growth in the organic industry in Australia, New Zealand and the Pacific Islands has been strongly influenced by rapidly growing overseas demand; domestic markets are, however, growing. In New Zealand, a key issue is lack of production to meet growing demand. Australia has had national standards for organic and biodynamic products in place since 1992, and like New Zealand, it is on the third country list of the European Union. It is expected that the Australian Standard, based on the National Standard employed since the early 1990s for the export market, will be adopted in 2009. In New Zealand, a National Organic Standard was launched in 2003. There is little government support to encourage organic agriculture in Australia. However, over the recent past, governments have been supportive of the Australian Standards issue. Furthermore, funding is made available to promote an understanding among consumers. In New Zealand, through the establishment of the sector umbrella organization Organics Aotearoa New Zealand and the Organic Advisory Programme as well as other initiatives, there is political recognition of the benefits of organic agriculture.

In the Pacific Islands work on a regional strategy and national plans to lay the foundation of sustainable organic agriculture development in the region is in progress.

The Regional Organic Task Force, a technical group representing all sectors and countries involved in organics, was charged with developing the Pacific Standard and will be responsible for implementing the Regional Action Plan. Pacific High Level Organics Group consists of Pacific leaders who have shown a commitment to the development of organic agriculture in the region and provide high level political support and advocacy. The first Pacific Organic Standard was endorsed by Pacific Leaders in September 2008. This provides a platform for further regional policy development around organic agriculture. (FIBL, IFOAM, ITC 2009).

Organic farming in India

The official position

As per a Food and Agriculture Organisation (FAO) study of mid-2003, India had 1,426 certified organic farms producing approximately 14,000 tons of organic food / produce annually. In 2005, as per Govt. of India figures, approximately 190,000 acres (77,000 hectares) were under organic cultivation. The total production of organic food in India as per the same reference was 120,000 tons annually, though this largely included certified forest collections.

Another side to the story

There are a number of farms in India which have either never been chemically-managed / cultivated or have converted back to organic farming because of their farmers' beliefs or purely for reason of economics. These thousands of farmers cultivating hundreds of thousands of acres of land are not classified as organic though they are. Their produce either sells in the open market along with conventionally grown produce at the same price or sells purely on goodwill and trust as organic through select outlets and regular specialist bazaars. These farmers will never opt for certification because of the costs involved as well as the extensive documentation that is required by certifiers.

Organic farming gains momentum in India

(As published in Business Standard: January 03, 2008)

Chennai/Bangalore: Four-fold rise targetted to take area beyond 2 million hectares by

2012. Organic agriculture movement is gaining in momentum in the country. The area under organic cultivation is likely to cross the 2 million hectare mark by 2012, according to National Centre for Organic Farming (NCOF), a body under the Union Ministry of Agriculture. This means a growth of nearly 4 times from the present 528,000 hectares, which includes both certified and in-conversion lands. According to Bangalore-based International Competence Centre for Organic Agriculture (ICCOA), a government recognised not-for-profit organisation promoting organic farming, organic farming is witnessing a growth of over 40 per cent year-on-year. While the domestic market for organic products is estimated at Rs 560 crore last year, the exports were in excess of Rs 250 crore. The Indian organic produce is mainly exported to Japan, Netherlands, Italy, France, Switzerland, the UK and USA.

Said Manoj Kumar Menon, Executive Director, ICCOA, "The major reason for the growth in organic farming is increased awareness among consumers in the country. Till now organic food was mainly being exported. But over the last couple of years, the domestic market has started growing. Many state governments have woken up to the importance of organic farming and have announced several incentives for farmers to go organic." The fact that organic movement has gained a wider acceptance was evident at the recently-concluded 'India Organic 2007', a trade fair and seminar. The third edition of India's first organic products trade fair, which was held for the first time in Delhi (Bangalore hosted the event in 2005 and 2006) saw participation of a record 184 companies and 25 state governments and 12 countries. The event generated business enquiries worth Rs 150 crore, a growth of 80 per cent over 2006, Menon said.

The fair, organised by NCOF, Agricultural and Processed Food Products Export Development Authority (APEDA), Research Institute of Organic Agriculture (FiBL),

Switzerland and ICCOA, witnessed 15,000 business visitors and key policy makers from the Central ministries and state governments.

The buyer-seller meet was a huge success. Large number of participants showed interest to have trade interactions with Indian organic producers. Out of 128 such meets, 58 B2B meets were held with foreign buyers directly.

Workshop on organic cotton and marketing of organic products, organic food festival and farmers meet were the other highlights of India Organic 2007.

Impressed with the progress made by the country in organic, the ministry of agriculture, government of Sri Lanka has invited by ICCOA to prepare a strategy for domestic market development in Sri Lanka, Menon said. The Sri Lanka government has also asked ICCOA to help them organise a trade fair on the lines of India Organic in Sri Lanka.

In India, the governments of Rajasthan, Maharashtra, Andhra Pradesh and Assam have also invited ICCOA to organise the organic trade fair in their states.

Organic Farming in India (Rural Economy)

The role of Organic Farming in India Rural Economy can be leveraged to mitigate the ever-increasing problem of food security in India. With rapid industrialization of rural states of India, there has been a crunch for farmland. Further, with the exponential population growth of India, the need for food sufficiency has become the need of the hour. Furthermore, the overuse of plant growth inhibitor, pesticides and fertilizers for faster growth of agricultural produce is detrimental to human health and the environment as a whole. The proposition of Organic Farming in India Rural Economy holds good, as an alternative to arrest this problem. The introduction of the process of Organic Farming in India Rural Economy is a very new concept. The huge furor over the overuse of harmful pesticides and fertilizers to increase agricultural out put has in fact catalyzed the entry of Organic Farming

in India Rural Economy. The process of organic farming involves using of naturally occurring and decomposable matter for growth and disease resistance of different crops. The concept of organic farming in India dates back to 10,000 years and it finds its reference in many Indian historical books.

Agriculture was the main source of livelihood in India and the use of naturally occurring matters for increased productivity, disease resistance and pest control was always in use, since time in memorial. The use of oil cakes, cow dungs, neem leaves, etc. is still practiced in India to ward of pests and used as preservatives. The use of chemical fertilizer for increased productivity started from late 1850s. In India, the first use of chemical fertilizer for increased agriculture productivity

started from 1906.

The Indian states involved in organic farming in India are as follows - Gujarat  Kerala  Karnataka  Uttarachal  Sikkim  Rajasthan  Maharashtra  Tamil Nadu  Madhya Pradesh  Himachal Pradesh

The main organic agricultural products of India are as follows- Bajra-mustard-wheat

 Chilly

 Cereals-cereals  Cereals-pulses

 Kholar  Maize  Ginger  Soybean  Large cardamom  Passion fruit  Dungarpur Pulses-cereals  Bajra  Mustard  Til  Wheat  Nagour Guar-cumin  Guar-wheat  Moong  Mustard  Ganganagar Cotton  Bhilwara Urd  Jaisalmer Bajra

 Bharatpur Bajra and wheat  Jhunjhunu Pulses and wheat  Alwar Wheat and bajra  Banswara Maize  Cotton-grass  Jaipur Guar

NEED FOR ORGANIC FARMING IN INDIA

The need for organic farming in India arises from the unsustainability of agriculture production and the damage caused to ecology through the conventional farming practices.

The present system of agriculture which we call 'conventional' and practiced the world over evolved in the western nations as a product of their socio-economic