Fisheries Sector In India: Dimensions Of Development

Ayyappan S. and M.Krishnan (2004), Indian fisheries: dimensions of development, Indian Journal of Agricultural Economics, July-September 2004, 59(3) : 391-412 (Annual Conference of Indian Society of Ag. Economics, TNAU, Coimbatore - lead paper)

FISHERIES SECTOR IN INDIA: DIMENSIONS OF DEVELOPMENT S.AYYAPPAN AND M.KRISHNAN1

Introduction

Fisheries sector occupies a very important place in the socio-economic development of the country. It has been recognized as a powerful income and employment generator as it stimulates growth of a number of subsidiary industries and is a source of cheap and nutritious food besides being a foreign exchange earner. Most importantly, it is the source of livelihood for a large section of economically backward population of the country. The main challenges facing fisheries development in the country have been in assessment of fishery resources and their potential in terms of fish production, development of sustainable technologies for fin and shell fish culture, yield optimization, harvest and post-harvest operations and landing and berthing facilities for fishing vessels, augmenting export of marine products, generating employment and improving welfare of fishermen and their socio-economic status. India with a long coast line of 8129 Kms, two million sq. kms of Exclusive Economic Zone and 1.2 million hectars of brackish water bodies, offers vast potential for development of fisheries. Against an estimated fishery potential of 3.9 million tones from marine sector, only 2.6 million tones are tapped. Fishing efforts are largely confined to the inshore waters through artisanal, traditional, mechanised sectors. About 90% of the present production from the marine sector is from within a depth range of up to 50 to 70 meters and remaining 10% from depths extending up to 200 meters. While 93% of the production is contributed by artisanal, mechanised

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Deputy Director General (Fisheries), Indian Council of Agricultural Research, Krishi Anusandhan Bhavan, Phase II, Pusa, New – 110 012 ([email protected]) and Head, Technology Transfer, Evaluation and Informatics Division, Central Institute of Brackishwater Aquaculture, 75, Santhome High Road, R.A.Puram, Chennai – 600 028 ([email protected]) respectively. The views expressed in this paper are those of the authors only.

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and motorised sector, the remaining 7% is contributed by deep sea fishing fleets confining their operation mainly to the shrimp grounds in the upper East Coast. A working Group constituted by Ministry of Agriculture in August 1990 had revalidated the fishery resource potential of Indian EEZ at 3.9 million tonnes of which 2.21 million tonnes are within a region of depth upto 50 meters. It is found that the resource within 50 meters.depth regions is at present exploited to the optimum level. The resource potential beyond 50 meters. is estimated at 1.69 million tonnes. Some of the commercially important resources uder exploitated beyond 50 mtrs. depth regions are tuna(2.09 lakhs tonnes), Tunnies (2.42 lakh tonnes), Ribbon fish (2.16 lakh tonnes), Perches(1.25 lakh tonnes), Cat fish (0.63 lakhs tonnes) etc (Annexure 1)

The Exports Dimension

The attention turned to seafood exports as a result of the implementation of the New Economic Policy of Government of India in mid 1991. Seafood or marine products exports was recognised as a source of great potential for earning foreign exchange to help ease the adverse balance of payments position that India was facing in those years.

Table 1 shows the pattern of agricultural exports from India. It can be noted that of the total value of exports of Rs. 55716 crores in 2003-04, 11.7 % of the exports value is from agricultural commodity exports. Among the agricultural products exports, marine products contributed 18.7 % of the total value of agricultural commodities exported. It is the single largest contributor to the agricultural commodities exports kitty of India.

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Table 1: Pattern of Selected Agricultural Commodities Exports from India Items

2001-02 Million US $

2002-03 % Share of Ag. Exp. 6.1 11.3 5.30 6.40 8.0 4.50

Tea 360.5 Rice 665.5 Spices 313.90 Cashew 375.10 Oil Meals 474.50 Fruits and 262.80 Vegetables Meat and 250.20 4.20 Meat Preparations Marine 1236.80 21.00 Products Agricultural 5901.00 exports Total 43826.70 Exports Ag. Exp. % 13.50 of Total Exports Source: DGCI&S

343.6 1238.10 342.80 424.20 308.80 300.20

2002-03 (April – Feb.) % Million % Share US $ Share of Ag of Ag. exports Exp. 5.1 320.3 5.3 18.40 1106.00 18.20 5.10 314.20 5.20 6.30 394.40 6.50 4.60 286.40 4.70 4.50 258.20 4.20

317.1 799.70 286.40 331.50 563.10 385.10

% Share of Ag Exp. 4.9 12.30 4.40 5.10 8.70 5.90

284.60

4.20

263.10

4.30

310.30

4.80

1431.60

21.30

1303.60

21.50

1218.80

18.70

Million US $

2003-04 Feb.) Million US Dollar

6734.00

6076.00

6506.00

52719.40

47136.10

55716.70

12.80

12.90

The index numbers of the unit values and quantum of exports of food and food articles and fish and fish preparations indicate that the rate of growth of the index in respect of fish and fish preparations have been outstanding (Table 2)

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(April-

11.70

Table 2: Index numbers of the unit values and quantum of exports (Base 1978-79=100) Commodity heads

Parameter 199091

199798

199899

19992000

200001

200102

Food and Unit Value 226 food articles Quantum 138

514

451

498

524

482

270

334

276

304

350

Fish and Unit Value 259 Fish preparations Quantum 164

679

685

700

808

703

294

283

324

349

371

Source: Statistical Abstracts, India, 2002

The index of unit values of exports of fish and fish preparations have grown almost twice as much as food and food articles, the index of quantum of both remaining more or less equal indicating that Indian exports of fish and fish preparations have doubled in unit value over time. Data of gross sales of companies in marine foods as per Centre for Monitoring Indian Economy (CMIE) shows to have more than doubled during the period 1993-94 to 2000 – 2001. The Herfindahl Index of Concentration of the CMIE sample of 148 companies indicate zero concentration implying that the seafood industry is wide open to market forces and competition which ensures that the market for seafood is almost perfectly competitive (CMIE data, June 2001 and August 2003). A Brief History of Marine Products Exports Till the close of 1960 the export of Indian marine products mainly consisted of dried items like dried fish, dried shrimp, shark fins, fish maws etc. The frozen items entered in the export basket in 1953 in negligible quantities. From 1961 the export of dried marine products was on decline and exports of processed items were making steady progress. With the devaluation of Indian currency in 1966 the frozen and canned items registered a significant rise. These items continued to dominate the trade. Markets for Indian products spread fast to developed countries from the traditional buyers in developing countries.

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Market Structure Before 1960, the markets for Indian marine products were largely confined to neighbouring countries like Sri Lanka, Myanmar, Singapore etc. This position continued as long as exports from India were dominated by dried items. When the frozen and canned items increasingly figured in our exports, the sophisticated affluent markets like USA, France, Australia, Canada, Japan etc. became important buyers. Processing units with modern machinery for freezing and canning came up at important centres to process and pack for exports. Over the years, the frozen seafood markets for Indian marine products have witnessed changes. The USA was the principal buyer for our frozen shrimp for a long time but after 1977, Japan emerged as the principal buyer for frozen shrimp followed by the Western European countries. While Japan continued to be the single largest buyer of our marine products accounting for 15.29% in volume and 30.56% in value during 2001-02, USA accounted for 11.55% of volume and 23.86% of the value during the same period. Share of USA is increasing steadily. China is one of the leading markets for fish items like Ribbon fish, Crocker etc. China accounted for 31.75% in volume and 10.03% in value of the total export of marine products from India. Export Trend The export of marine products had grown to greater proportion as one of the important item of India's exports. accounting for approximately 4 % of the total export from India. Dried fish was the prominent item exported during the fifties and sixties but in the seventies it gave way to frozen and canned products. During eighties, the canned items slowly disappeared and frozen items become the prominent one in India's seafood trade. Amongst the frozen items also, there was changes in the demand from various countries. While Japan showed their preference to headless shell on shrimp, the USA demanded peeled shrimp meat while the European countries preferred the IQF shrimp in frozen and cooked form. The European market also absorbed the major share of cephalopods while Japan

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had taken a small share of it. Due to introduction of new deep sea fishing vessels and modification of the existing trawlers to suit deep sea fishing, a large quantity of fish become available for export. These frozen fish items had greater demand in the South East Asian countries as well as in the Middle East (Annexure II) In the seventies, the export was depending mainly on shrimp but due to the export promotional measures, it become possible to diversify the products in eighties adding Cephalopods (Cuttlefish, squid and octopus) and frozen fish (such as Pomfret, Ribbon fish, Seer fish, Mackerel, Reef cod, Croakers, Snapper etc). While all these items hold good prospects, live fish, chilled fresh water fish etc. are promising items for the future. Due to the introduction of scientific shrimp farming, the export of frozen value added shrimp is continuing as the major foreign exchange earner among marine products. Export of items like breaded and battered shrimp, double skinned cuttlefish, fish burgers, sea food mix, squid fillets etc. have made its presence felt and is expected to increase in leaps and bounds by the turn of the century. The export mainly consists mostly of low valued fin fish varieties (35.83%) followed by frozen Shrimp (33.83%), frozen Cephalopods (22.88%) and dried seafood items (2.07%). The major change noticed in the export trend, is the emergence of South East Asia who continued to be the top most importer of marine products in terms of volume. The other individual markets which increased their shares are Canada, Mauritius, Australia, Switzerland, Maldives, New Zealand, Reunion, Panama, Venezuela, Taiwan, Bangladesh, Philippines, Turkey and Malta. Marine Products Exports : Recent Trends Export of marine products has increased considerably to an all time high both in volume and value during 2002-03 with actual export of 467297 MT valued at Rs.6881 crore or US $ 1425 million. There is an increase in the unit value realisation also over the previous year. The increase in unit value was 3.39%. The export details during the last 5 years is given in Table 3.

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Table 3: Marine Products Exports 1998- 2003 Q: Quantity in MT, V: Value Rs. Crore, $: US Dollar in Million

1998-99

1999-00

2000-01

2001-02

2002-03

Q V $ Q V $ Q V $ Q V $ Q V $

Variation - 82884 - 70.61 - 188.95 + 37069 + 468.87 + 77.32 +97443 +1327.22 +227.31 -16003 -486.84 -16297 +42827 +924.26 +171.55

Export 302934 4626.87 1106.91 340003 5095.73 1184.23 440473 6443.89 1416.32 424470 5957.05 1253.35 467297 6881.31 1424.90

(%) - 21.48 - 01.50 - 14.58 + 12.24 + 10.13 + 06.99 +28.41 +19.12 +19.12 -3.63 -7.56 -11.51 +10.09 +15.52 +13.69

U.V. 152.73 3.65 149.87 3.49 146.29 3.22 140.36 2.95 147.26 3.05

Major Items Frozen Shrimp continued to be the major item, contributing 66.97% in value of the total export of marine products from India. Even though the share of shrimp export has decreased from 30.09% of the previous year to 28.85% in quantity and from 69.50% of the previous year to 66.97% in terms of value it recorded a growth of 5.56%, 11.31% and 9.46% in terms of volume, rupee realisation and in US $ terms during 2002-03. The unit value of shrimp also increased to US $ 7.07 per kg from US $ 6.82 per kg realised during the previous year i.e. an increase of 3.67%. The share of frozen fish during 2002-03 was 42.01% in volume compared to 41.22% in 2001-02 and 12.23% in value compared to 11.97% in 2001-02. There has been an increase in the export of frozen fish by 12.20% in quantity and 18.03% in rupee value respectively over the previous year. There was marginal increase in the unit value realization. The unit value realised was US $ 0.89 per kg from US $ 0.86 of the last year registering a growth of 3.49%. Frozen ribbonfish, frozen pomfret, frozen tuna (Skipjack, Yellow Fin), fish loins and steaks contributed considerably in increasing the export of Frozen Fish. This year, export of Cephalopods especially Cuttlefish showed a growth, which was to the tune of 35.37% in quantity and 48.92% in value.

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The export of frozen. squid also registered a growth of 16.59% in value terms over the previous year. However, there was a shortfall of 4.91% in volume. Live items like live whelk (Baigai), live fish and live crab showed an increase in exports whereas the export of live lobster, live aquarium fish and live snail recorded a shortfall during the year. Export of chilled items has accorded a decline both in volume and value during this year. Details of item-wise export during the last two years are available in Table 4. Table 4: Item Wise Exports of Marine Products Q: QUANTIY IN MT, V: IN RS. CRORE, $: US$ IN MILLION, UV$: UNIT VALUE IN US$/KG ITEMS

% Share to Total

Frozen Shrimp

28.85 66.97 66.91

Frozen Fin Fish

42.10 12.23 12.26

Frozen Cuttle Fish

8.85 6.06 6.06

Frozen Squid

8.10 5.59 5.60

Dried items

1.75 1.22 1.23

Live items

0.45 0.78 0.78

Chilled items

0.72 0.86 0.86

Others

9.27 6.29 6.30

TOTAL

100.00 100.00 100.00

Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$ Q V $ UV$

APR-MAR 2002-03 134815 4608.31 953.44 7.07 196322 841.65 174.63 0.89 41381 417.09 86.09 2.09 37838 384.37 79.83 2.11 8178 84.23 17.46 2.13 2115 53.66 11.12 5.26 3350.00 59.14 12.27 3.66 43298.00 432.86 89.78 2.07 467297.00 6881.31 1424.90 3.05

(*) Salted Jellyfish is included under Dried Items.

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APR-MAR 2001-02 127709 4139.92 871.03 6.82 174976 713.11 150.04 0.86 30568 280.07 58.93 1.93 39790 329.67 69.36 1.74 * 8307 67.96 14.30 1.72 1628 40.57 8.54 5.24 3284.00 63.66 13.39 4.08 * 38208 322.09 67.76 1.77 424470 5957.05 1253.35 2.95

VARIATION

(%)

7106 468.39 82.41 0.25 21346 128.54 24.59 0.03 10813 137.02 27.44 0.16 -1952 54.70 10.47 0.37 -129 16.27 3.16 0.41 487 13.09 2.58 0.02 66 -4.52 -1.12 -0.42 5090 110.77 22.02 0.30 42827 924.26 171.55 0.10

5.56 11.31 9.46 3.67 12.20 18.03 16.39 3.49 35.37 48.92 46.56 8.29 -4.91 16.59 15.10 21.26 -1.55 23.94 22.10 23.84 29.91 32.27 30.21 0.38 2.01 -7.10 -8.36 -10.29 13.32 34.39 32.50 16.95 10.09 15.52 13.69 3.39

Major Markets USA emerged as the single largest market for Indian marine products during 2002-03 relegating Japan to the second position. The share of USA was 13.21% in quantity, 29.81% in value by registering an export growth of 25.82% and 44.30% in volume and value respectively. The share of Japan was 11.75% in volume and 22.30% in value. There was a shortfall in the export to Japan to the tune of 15.39% and

15.70%

in

quantity

and

value

terms

respectively.

In spite of the antibiotics problems in the EU, the export to EU countries registered a growth of 14.50% and 21.21% in volume and value when compared to the year 2001-02. The member countries of European Union together accounted for 20.23% and 20.18% in the total quantity and value of Indian marine products exported. In terms of quantity, China occupied the first position contributing 36.55% of the total exports from India. However, China’s share in value was only 11.08%. This was mainly due to the export of low valued items, especially finfish varieties like frozen ribbonfish, frozen croaker, etc. There was also a remarkable increase in exports to China in terms of quantity (by 26.75%) and value by 27.67%. The export to South East Asia has also increased by 19.24% in value with a shortfall of 15.88% in volume compared to last year. The export to Middle East market has increased 2.66% in quantity, 13.08% in value and 11.29% in dollar terms. Exports to other markets like Australia, Tunisia, South Africa, Lithuania, Mexico, Dominican Republic, Poland, Puertorico, Ukraine, etc. showed a positive growth in volume, value and foreign exchange realization terms. Other markets like Sri Lanka, Canada, Mauritius, etc. had a growth in terms of value but declined in volume terms (Table 5). Prospects of Fisheries growth:

With the fisheries sector comprising of marine fisheries, freshwater and brackishwater aquaculture and inland fisheries consisting of tanks and reservoirs, the potentiality of the sector as a whole remains to be fully tapped. It remains a sector of much promise. Fisheries sector in particular is more complex enterprise that functions under integrated network of natural resources, other enterprises with forward and backward linkages with fisheries and other socio-political variables. Major functions of fisheries 9

enterprises viz. production, transportation and processing involves value addition from labour, capital and management which significantly influences the rapid economic development of the country. Unlike agriculture, contribution of fisheries sector to GDP continues to grow at a rapid pace because of expansion of culture fisheries enterprises.

Table 5: Country Wise Export of Marine Products Q:Quantity in M T, V: Value in Rs. Crore, $: US Dollar Million

COUNTRY JAPAN

USA

European Union

CHINA

South Asia

% share to Total 11.75 22.30 22.26 13.21 29.81 29.79 20.23

20.18 20.20 36.55 11.08 11.10 East 9.44

Middle East

9.33 9.35 4.21 2.98 2.98 4.61

OTHERS

TOTAL

4.32 4.32 100.00 100.00 100.00

APRMAR 2002-03 54916 1534.76 317.17 61703 2051.12 424.51

Q V $ Q V $

APR-MAR VARIATION % 2001-02 64905 -9989 -15.39 1820.69 -285.93 -15.70 383.07 -65.90 -17.20 49041 12662 25.82 1421.38 629.74 44.30 299.05 125.46 41.95 * 94541 82572 11969 14.50 1388.47 1145.49 242.98 21.21 287.84 241.01 46.83 19.43 170811 134767 36044 26.75 762.48 597.23 165.25 27.67 158.23 125.66 32.57 25.92

Q V $ Q V $

44097 642.38 133.15 19668 204.74 42.40

Q V $ Q V $

Q V $ Q V $

52424 538.75 113.35 19159 181.06 38.1 * 21561 21602 297.36 252.45 61.60 53.11 467297 424470 6881.31 5957.05 1424.90 1253.35

-8327 103.63 19.80 509 23.68 4.30

-15.88 19.24 17.47 2.66 13.08 11.29

-41 44.91 8.49 42827 924.26 171.55

-0.19 17.79 15.99 10.09 15.52 13.69

* Norway and Switzerland are excluded from EU and included in Others

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Performance of the fisheries sector has been quite consistent. Fish production was 0.75 million tonnes in 1950-51. It rose to 2.34 million tonnes during 1979-80 and then to 3.68 million and 5.26 million tonnes in 1989-90 and 1998-99 respectively. In terms of growth, production rose by 4.78 per cent in 1979-80 to 1989-90 and by 4.70 during 1989-90 to 1998-99 (Table 6)

Table 6: Production and Growth Rates of Some Major Agricultural Commodities Commodity

Production (Million tonnes) 19491979198950 80 90

199899

Rice Wheat Foodgrains

23.54 6.39 54.92

42.33 31.83 109.70

73.57 49.85 171.04

85.99 70.78 203.04

Fish

0.75

2.34

3.68

5.26

Growth rates (% per annum) 1979 to 1989-90 1989-90 to1998-99 Area 0.45 0.57 (-) 0.11

Prod 4.29 4.24 3.54

Yield 3.82 3.65 3.33

4.78

Area 0.49 1.64 (-) 0.18

Prod. 1.70 3.64 1.80

Yield 1.21 1.96 1.42

4.70

Source: Planning Commission (2002) p. 55 (abridged)

Changes in output values and performance:

The performance of the fisheries sector has been commendable relative to that of agriculture and livestock .The performance of fisheries between 1995-96 and 2000-01 has been significantly attractive. Analysis of data on gross output values of agriculture, livestock and fisheries revealed that percentage of positive change in output values with respect to time has risen by 28 per cent in fisheries with inland fisheries contributing more than 40 percent of the growth (Table 7).

Table 7: Matrix of change in output values in agriculture, livestock and fisheries (1993-94 = 100) Sectors Agriculture Livestock Fisheries Inland Fisheries Marine Fisheries

1995-96

1996-97

1997-98

103.60 107.56 110.90

113.65 111.34 119.71

110.19 114.47 121.37

118.68 119.27 117.65

119.43 122.85 125.58

200001 116.38 127.09 127.78

112.25 109.60

117.77 121.58

120.75 121.96

128.20 107.52

139.70 112.02

140.78 115.30

Data Source: National Accounts Statistics, CSO (Data for 1994-95 – NA) 11

1998-99

1999-2000

Requirements, growth and projections Given the objectives of removal of incidence of poverty and unemployment and of ensuring food and nutritional security, attaining a high growth rate in agriculture in the Tenth Plan and beyond is necessary. The targeted annual growth rates in the value of agricultural output for the Tenth and Eleventh Plans are 5.3 percent and 5.1 per cent respectively. The commodity wise break up of the target growth rates is given in Table 7. Table 7: Target growth rate in value of output of agriculture during the Tenth Plan and XI Plan ( Per cent) Sr. No 1.

Commodity Agricultural crop Foodgrain

a)

Rice Wheat Coarse cereal Pulses

i) ii) iii) iv) b) c) d) e)

Oilseeds Sugar Cane Fruits & Vegetables Other agricultural products of which Tea Coffee

i) ii) 2.

Livestock a) b) c)

Milk Group Meat & Poultry group Other livestock products

X Plan 4.54 3.57 3.08 4.31 2.40

XI Plan 4.27 2.73 2.73 3.64 2.43

4.93 8.85 6.16 8.01 3.08

5.66 5.16 6.07 7.89 3.04

6.16 6.16 7.68 8.32

6.07 6.07 7.36 7.89

8.63

8.50

1.85

1.82

3. Fishery 7.00 7.00 4. Total agriculture 5.30 5.10 Note: The growth rates differ from the growth rates of the quantum of output on account of expected changes in relative prices. Source: Planning Commission (1999)

The targeted rate of growth of value of output of the fishery sector has been pegged at 7 per cent in both the X and the XI plans, comparable to the targets for the

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livestock sector indicating the growing confidence of the country in the fisheries sector.

But, during the Ninth Plan period, Rs. 800 crore had been earmarked for the fisheries sector. Against the outlay of Rs. 119.15 crore for 1997-98 and Rs. 159.90 crores for 1998-99, expenditures was only Rs. 85.06 crore (71.4 per cent) and Rs. 91.42 crore (57.2 per cent) respectively (Planning Commission, 2002).

The state wise projected outlay for the fisheries sector in the Tenth Five Year Plan 2002 – 2007 is given in Table 8. Andhra Pradesh has made more than 50 per cent of its outlay on agriculture to fisheries. West Bengal (20%) and Kerala (16 %) are the only other two states that have more than 15-20 per cent of their outlay on agriculture directed towards fisheries. The projected outlays do not seem to have been made based on the inherent potential of at least the maritime states and reallocation of outlays in tune with the requirement and potential of the sector can be hoped for.

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Table 8: Projected Outlay for Fisheries Sector – States / UT’s (2002-2007) (Rs. Lakhs) X Five Year Plan States / UT’s Agriculture and activities Andhra 2333.21 Pradesh Arunachal 51531.00 Pradesh Assam 66498.00 Bihar 53611.00 Chattisgarh 86097.00 Goa 15834.00 Gujarat 354871.00 Haryana 46953.00 Himachal 120169.00 Pradesh Jammu & 150780.00 Kashmir Jahrkhand 82485.00 Karnataka 234694.00 Kerala 112500.00 Madhya 158152.00 Pradesh Maharashtra 424862.00 Manipur 11386.00 Meghalaya 29960.00 Mizoram 16198.00 Nagaland 25550.00 Orissa 116520.00 Punjab 63541.00 Rajasthan 164948.00

allied

Fisheries 1270.00

Fisheries %of Agriculture & a/a 54.43

2394.00

4.65

6829.00 1895.00 1884.00 780.00 6639.00 3720.00 1554.00

10.27 3.53 2.19 4.93 1.87 7.92 1.29

4537.00

3.01

2075.00 6765.00 17500.00 2989.00

2.52 2.88 15.56 1.89

7020.00 1375.00 700.00 607.00 950.00 3445.00 694.00 302.00

1.65 12.08 2.34 3.75 3.72 2.96 1.09 0.18

Sikkim Tamil Nadu

17499.00 393205.00

200.00 20400.00

1.14 5.19

Tripura Uttar Pradesh

45000.00 514240.00

2603.00 5000.00

5.78 0.97

Uttaranchal West Bengal Total States A&N Islands Chandigarh D&N Haveli Daman & Diu Delhi Lakshadweep

69492.00 91463.00 675195.00 177777.00 2032.50 2783.50 923.45 13745.00 10683.60

367.00 17560.00 22927.00 2725.00 100.00 0.00 223.00 50.00 5989.26

0.53 19.20 3.40 1.53 4.92 0.00 24.15 0.36 56.06

Pondicherry Total (UT’s) Total States & UT’s % to total outlay

19580.00 67525.05 3818885.05

1280.00 10367.26 132421.26

6.54 15.35 3.47

6.46

0.22

Source: Planning Commission (2002)

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Table 9 gives the projected production and per capita consumption of selected agricultural commodities. The figures have been worked out on the basis of the expected population growth rate in per-capita consumption expenditure and the elasticity of demand with respect to per capita consumption expenditure.

Table 9: Projected production and per capita consumption of selected agricultural commodities Commodity Production Consumption Production Consumption 1996-97 (mil. 1996-97 (Kgs.) 2011 – 12 ( 2011-12 (Kgs.) Ton) Mil. Ton) 1) Agricultural Crop a) Foodgrain 199.32 188.50 337.3 223.35 i) Rice 81.31 84.00 128.16 93.80 ii) Wheat 69.27 63.00 130.45 81.25 iii) Coarse 34.27 27.50 48.93 27.50 cereals iv) Pulses

b) Oilseeds c) Sugar Cane

14.46 24.96 277.25

14.00 7.00* 27.00**

29.76 58.56 679.64

20.80 11.05* 45.48**

68.60 5.35

70.25 5.05

227.50 14.76

152.15 9.30

2) Livestock a) Milk

3) Fishery

* Consumption of oilseeds is in terms of edible oil ** Consumption of sugarcane is in terms of sugar and jaggery

Source: Planning Commission, 1999

Food grain consumption is likely to increase from 188.50 Kgs / per capita in 1996-97 to 223.35 Kgs/ per capita in 2011-12. In order to meet this demand, the production of foodgrain is projected to increase from 199.32 million tonnes in 199697 to 337.3 million tonnes in 2011-12. Fish consumption is likely to rise from 5.05 Kgs./ per capita in 1996-97 to 9.30 Kgs./ per capita in 2011-12. (Planning Commission, 1999).

Role of NABARD and institutional Finance:

India’s rural credit system is unique in its reach and diversity. The thrust of National Bank’s (NABARD) rural development programmes has been to make a frontal attack on poverty through their credit and development functions. NABARD’s refinance to credit institutions rose from 703 crore 1n 1982-83 to Rs. 6683 crore in

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2001-02. Table 10 gives the disbursement of refinance to the fisheries sector including aquaculture.

Table 10: NABARD Refinance to Fisheries and Aquaculture Year

(Rs. Crores)

Refinance to agriculture

Refinance to Fisheries / Aq. 1990-91 21.00 1991-92 31.00 1992-93 31.00 1993-94 55.00 1994-95 100.00 1995-96 107.40 1996-97 40.59 1997-98 32.58 1998-99 3837 29.69 1999-2000 4351 26.84 2000-01 5104 34.25 2001-02 3837 36.50 2002-03 6146 34.73 Source: O/O. General Manager (Fisheries), NABARD, Chennai -34 Refinance to the fisheries sector needs to play a greater role In financing the fisheries sector. But a portion of the non- farm sector refinance is also a part of the overall assistance to the fisheries sector. The figures in Table 10 does not reflect this information. Moreover the ground level credit (GLC) reflects the actual credit made available to the fisheries sector (Table 6). Table 11: Ground Level Credit and Refinance Disbursed to the Fisheries Sector (Rs. Cr.) Type Years 1997-98 1998-99 1999-2000 Ground Level credit (GLC) 338.00 443.00 508.00 Refinance Disbursed 32.58 29.69 26.84 Per cent of GLC 9.64 6.70 5.28 Source: O/O. General Manager (Fisheries), NABARD, Chennai –34 The refinance component of the GLC to the fisheries sector has been declining in the recent years. The GLC, which reflects the actual funds made available to the sector both in terms of refinance through the NABARD and through commercial banks has been increasing. The NABARD is taking a positive and proactive role in financing the fisheries and aquaculture by way of co-financing with commercial banks and also extending direct credit to entrepreneurs. 16

Long Term Management Targets: Deep Sea Fishing In 1986 Government of India revised its Deep Sea Fishing Policy giving more stress to joint ventures in deep sea fishing. In 1991 Government of India further modified the deep fishing policy encouraging long lease of fishing vessels and permitting test fishing as prelude to joint venture. Subsequent to the recent economic liberalisation conditions for foreign equity permitted in the case of a deep sea fishing policy are as •

New or second hand vessels can be acquired on lease.

•

The vessels should be for non-shrimp resource.

•

Deep sea fishing project can be registered under 100% EOU scheme.

•

Test fishing may be done to establish techno-economic viability.

•

Foreign collaboration involving foreign equity upto 51% is generally permitted. Foreign equity once invested is considered on par with Indian share holding.

•

Foreign equity can be by way of fishing vessels also.

•

Services of foreign crew can be availed.

•

Mid sea bunkering is permitted . Considering the importance of deep sea fishing sector in marine products

export, the Marine Products Exports development Authority (MPEDA) has initiated a number of steps for increasing the fleet strength for exploitation of under exploited resource and for encouraging the existing outrigger trawlers to modify for diversified fishing. Aquaculture To augment production through aquaculture and to sustain and increase the exports, the government of India promotes •

Micro and macro level survey to identify suitable sites for farming

•

Preparation of site specific project reports

•

Technical advice on various aspects of farming.

•

Training farmers/entrepreneurs in farming

•

Arrange visit of farmers from one state to other state for learning different aspects of farming.

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•

Conduct workshop/seminar/symposium/farmers meets for the benefit of farmers/entrepreneurs.

•

Promote ecofriendly aquaculture

Controls / Enforcements being practiced for sustainable management of resources, food safety etc. Regulatory Tools Constituted under Section 3 (3) of the Environment (Protection) Act, 1986, the Aquaculture Authority is mandated to protect the ecologically fragile coastal areas, sea shore, water front and other areas through regulation of shrimp culture in coastal States and Union Territories of India. The Authority promotes development of sustainable and responsible shrimp farming practices within and outside the Coastal Regulation Zone.

Functions of the Aquaculture Authority The functions of the Aquaculture Authority are enshrined in the Notification of S O 88 (E) dated 6 Februrary 1997 and subsequently amended vide notification S O 421 (E) dated 20 May 1997 of the Ministry of Environment and Forests. The functions of the Authority are as follows: I.

II.

To exercise the powers under section 5 of the Environment (Protection) Act, 1986 for issuing directions and for taking measures with respect to matters referred to in clauses (v), (vi), (vii), (viii), (ix) and (xiii) of subsection (2) of Section 3 of the said Act. To ensure that no shrimp culture pond can be constructed (or) set up within Coastal Regulation Zone and up to 1 000 m of Chilka lake and Pulicat Lake (including bird sanctuaries namely Yadurapattu and Nelapattu).

III.

To ensure and give approval to the farmers who are operating traditional and improved traditional systems of aquaculture for adopting improved technology for increased production

IV.

To ensure that the agricultural lands, salt pan lands, mangroves, wet lands, forest lands, land for village common purposes and the land meant for public purposes shall not be used (or) converted for construction of shrimp culture ponds.

V.

To implement the “Precautionary Principle” and the “Polluter Pays Principle” in coastal shrimp aquaculture activities by adopting the procedure described in

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the Supreme Court Order dated 11 December 1996 passed in Writ Petition (Civil) No 561 of 1994. VI.

To regulate and give the necessary approvals/ authorisation for shrimp activities outside Coastal Regulation Zone areas and 1000 m from the Pulicat lake and Chilka lake.

VII.

To frame scheme/schemes in consultation with expert bodies like National Environmental Engineering Research Institute, Central Pollution Control Board, respective State Pollution Control Board for reverting the damages caused to the ecology and environment by pollution in coastal States/ Union Territories.

VIII.

To ensure the payment of compensation to the workmen employed in the shrimp culture industries as per the procedure laid down in the Supreme Court Order dated 11 December 1996 passed in Writ Petition (Civil) No 561 of 1994.

IX.

To comply with the relevant orders issued by the concerned High Courts and Supreme Court from time to time.

X.

To deal with any other relevant environment issues pertaining to coastal areas with respect to shrimp culture farming, including those which may be referred to it by the Central Government in the Ministry of Environment and Forests.

For discharging the above functions, the Aquaculture Authority has constituted State Level Committees (SLCs) and District Level Committees (DLCs) under the chairpersonship of Secretary-in-Charge of Fisheries and the District Collector/ Deputy Commissioner respectively. The applications submitted by the shrimp farmers are received by the DLCs and after scrutiny and verification of the information and field level inspections, wherever necessary, are forwarded to the SLCs for consideration. The applications after recommendation of the SLC are forwarded to the Aquaculture Authority for consideration for issue of approvals. Quality Control and Food Safety Quality & Food Safety is the foundation of any food processing industry. In the sea food industry, quality control is a very vital element as quality of the products processed is highly heterogeneous and perishable in nature, particularly under tropical conditions. Realizing this, the industry has adopted modern methods of handling, processing besides adequate quality control measures to improve the quality of sea food.

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To cope up with the increasing demand for safe food and to satisfy the needs of health / quality conscious consumers of the global seafood market, the government has identified the following thrust areas for development / improvement and implement programmes as under: i)

Product development for export: Research and development of new products Training in new technology and inviting overseas technical experts to India

ii) Quality improvement Imparting training to technologists of Indian seafood industry in quality control in overseas labs Entrusting special research projects on quality problems with National Research Institutes Monitoring of seafood quality in landing and pre-processing centers. Integrated development programme for upgrading seafood quality by providing infrastructural facilities like pre-processing centers and setting up of mini lab towards quality assurance. Evolving standards for compliance for export of fish and fishery products to various developed countries based on standards / norms / regulations prescribed by such countries.

Salient features of some of the standards now being implemented in India are given below: Consequent to the promulgation of US Seafood Regulation on HACCP on 18th December 1995, it has become mandatory that every processor and importer has to comply with HACCP with effect from 18.12.1997.

Government of India

constituted HACCP Cell in early 1996 to assist the Indian seafood industry for the effective implementation of HACCP. The major activities of the HACCP Cell are : •

Organizing training programmes in HACCP basic principles, audit etc. for the benefit of technical personnel in the seafood industry and related departments. So far, 32 such programmes were organized for the benefit of over 900 technical personnel.

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•

Assisting the seafood establishments in the preparation of HACCP manual, certification of such manuals, certification of HACCP compliance etc. So far, 26 processing establishments in India are issued with HACCP compliance certificate by MPEDA.

•

Inviting Consultants from US FDA, NMFS, FAO / INFOFISH etc. from time to time which facilitates in updating knowledge on HACCP and strengthen the technical base of MPEDA and the industry.

Besides, ICAR fisheries institutes and the MPEDA lab at Cochin has facilities to test seafood samples for heavy metals, pesticides and antibiotic residues using advanced technology. These institutions also serve as a member in the Export Inspection Council of India, Bureau of Indian Standards and National Committee of Codex Alimentarius. Value Addition and Quality Control Modernisation of Processing Facilities Several importing countries are stipulating stringent quality control for marine products. Introduction of the concept of HACCP by USFDA, ISO 9000 and European Community directive (EC 91/493) demand very high hygienic standards in the production and processing facilities. Modernisation of processing facilities to meet international standards is of primary importance for the industry in the coming years.

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Table 12: State-wise summary of the list of approved Units to EU (2002) Maritime State Gujarat Maharashtra Karnataka Kerala Tamil Nadu Andhra Pradesh Orissa West Bengal Total PP ZV

PP 14 15 5 52 19 24 4 5 138

ZV 0 0 0 0 0 5 0 0 5

Total 14 15 5 52 19 29 4 5 143

Processing Plant Freezer Vessel

The seafood industry in India is currently in a transitional stage from the traditional block freezing on the production of Individually Quick Frozen (IQF) and other value added frozen items for export to the major overseas markets. Market Service and Market Promotion With this aim and objective, the Government of India through the MPEDA has drawn up various market promotion programmes for projecting our resource potential, product diversification, quality assurance and liberal incentives for investments and joint ventures. These include: 1. 2. 3. 4. 5. 6. 7. 8.

Overseas market survey Data collection and maintenance of Data Bank Assistance for market development Publicity through media and production of literature and films on trade promotion. Sponsoring of sales team / delegations. Invitation of overseas experts for export promotion visit to India. Organising buyer-seller meets in overseas markets Participation in overseas Trade Fairs and Exhibition Exhibition & Trade Fairs within India.

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Quality Control MPEDA ensures the highest standards for seafood's exported from India. It works in close association with Export Inspection Council of India and the Fisheries Institutes of the ICAR and other Indian and International quality control organizations. Assistance is given to registered processors to set up quality control laboratories and modern pre-processing plants throughout the country to meet the ISO 9000 quality standards. The HACCP cell in MPEDA offers advise on matters connected with EC Directives (Annexure III).

Conclusions

The Union Budget 2004 speaks of water bodies restoration and enhancement of agricultural credit through specific programs aimed at agricultural development. A concerted effort to understand fisheries and its nuances to make the best of the comparative advantage that we have in this sector would go a long way to assimilate the blue revolution in its entirety. Not only in respect of exports but the scope of he fisheries sector as a provider of employment and income is to be realized in full measure. Non governmental agencies like the Dr. M.S.Swaminathan Foundation, the Aquaculture Foundation of India, and the inter-governmental body, the Bay of Bengal Program have been in the forefront to exploit the scope of fisheries as a provider of income and employment. Sufficient attention need to given to sustainability of aquaculture operations by adoption of proper management practices. The scope of diversification of enterprises within the gamut of aquaculture operations is available in the literature generated by fisheries research institutes and fisheries colleges located in the country. This literature needs to be studied and intensive efforts made to suggest economically viable and socially accepted technologies developed, reach the masses. The role of the fisheries sector need to be highlighted in order to build awareness among the population to enhance increased participation and create social cohesiveness for the development of the sector.

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Agricultural economics research has not paid sufficient attention to the fisheries and aquaculture component that is an integral part of its whole. Dynamics of fisheries and aquaculture economics research demand that in order to get the best out of the policy efforts of the government, the output from this group need to enhanced quantitatively and qualitatively.

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Annexure I Estimated group wise fishery potential of the Indian EEZ Quantities are in' 000 Tonnes Groups Elasmobranchs Eels Cat Fish

Upto 50 m

Beyond 50 m

Total

65

103

168

7

-

7

60

63

123

191

-

191

Other Sardines

96

-

96

Anchovies

53

-

53

Other Clupeids

196

14

210

Bombay Duck

104

-

104

27

21

48

Perches

114

125

239

Sciaenids

120

22

142

95

216

311

Oil Sardine

Lizard Fish

Ribbon Fish Carangids

143

304

447

Silverbellies

82

4

86

Pomfrets

42

12

54

Mackerel

162

62

224

Seer Fish

42

-

42

Tunnies

37

242

279

Flat Fish

38

-

38

Penaeid Prawns

178

-

178

Non-Penaeid Prawns

54

-

54

Cephalopods

50

21

71

Priacanthus Sp.

-

55

55

Black Ruff

-

9

9

Indian drift fish

-

7

7

Deep Sea Prawns

-

3

3

Deep Sea Lobster

-

5

5

Oceanic Tunas

-

209

209

Bill Fishes

-

4

4

254

189

443

2210

1690

3900

Others Total

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Annexure II (EXIM POLICY 2002-07) 1.

Items permitted (EXIM POLICY 2002-2007) (i)

No Quantitative restrictions on export.

(ii)

Licence under EXIM policy not required for import of 125 species/groups of fish, crustaceans, molluscus and other aquatic invertiberates covered under FREE policy in Chapter 3 of ITC (HS) classification of Export &Import items under the EXIM policy.

(iii)

Import of five groups of live fish permitted under Restricted Policy (EXIM Code 0301)

(iv)

Import of Whale Shark (Rhincodon types) and parts and products of the species is restricted.

2. Promotional measures (i)

Central assistance to States for development of critical infrastructure for export such as roads, inland container depots, container freight stations, Export Promotion Industrial Parks and for equity participation in infrastructure projects.

(ii)

Encouragements to State Governments for setting up Export Zones.

(iii)

Declaration of Towns of Export Excellence to encourage setting up of critical infrastructure for export production, encourage common service providers and facilitate availability of better technological services and integrate benefits under the other schemes of EXIM Policy for the units in such towns.

(iv)

Market Access Initiative Schemes for encouraging increased marketing efforts by exporters/Brand promotion

(v)

Schemes to promote the Concept of Total Quality Management.

3. Import for export production (i)

Advance license for duty free import of inputs for export production.

(ii)

Duty free import of raw material for jobbing for export/re export.

(iii)

Manufacturer exporters, merchant exporters tied to supporting manufacturers and service providers eligible for import of capital goods at

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5% Customs duty linked to fulfilment of export obligation in 8 to12 years under EPCG Scheme. 4. EOU/EPZ/SEZ (i) Scheme of 100% EOU/Export Processing Zone/Special Economic Zone for export production continues. No trading units permitted under the scheme.

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ANNEXURE III : AQUACULTURE SECTION-SUBSIDY ASSISTANCE SCHEMES (as on 01.09.02) GIVEN BY MPEDA Sl No

Name of Scheme

Objectives

Quantum of Subsidy

1

Subsidy for new farm development

For development of new prawn / shrimp farms

@25% of the capital cost, subject to a maximum of Rs.30,000/- per ha. water area, restricted to Rs.1.5 lakh per beneficiary.

Subsidy for small-scale hatcheries

For setting up of shrimp hatchery with a minimum production capacity of 10 million seeds per annum

@ 15% of the capital cost or Rs.1.50 lakh for private hatcheries, 25% or Rs.2.50 lakh to co-operative sector and 50% of Rs.5.00 lakh to Govt. sector.

3

Subsidy for mediumscale hatcheries

For setting up of shrimp hatchery with a minimum production capacity of 30 million seeds per annum

@ 25% of the capital cost, subject to Rs.5.00 lakh per beneficiary / hatchery (about 7 districts are excluded, being overcrowded already)

4

Subsidy for setting up of PCR labs in hatcheries

To establish PCR labs in hatcheries

@ 50% of capital cost, subject to a maximum of Rs.5 lakh per beneficiary /hatchery.

5

Subsidy for effluent To set up effluent treatment system(ETS) in treatment systems Shrimp Farms. attached to shrimp farms

@ 25% of the capital cost, subject to Rs.1.50 lakh for shrimp farms with a minimum water area of 5.00 ha and upto Rs.6.00 lakh per beneficiary

6

Subsidy for establishment To set up facilities for post of chill room facilities in harvest care of farm raised shrimp / prawn farming shrimp/prawn. areas

@25% of the cost of establishment of chill room, subject to a maximum of Rs.3.00 lakh per beneficiary / farmer.

7

Subsidy for purchase of water testing kits / equipment for shrimp / prawn farms

@ 25% of the cost of water testing kits / equipment purchased for use in the farm, subject to a maximum of Rs.30,000/- per beneficiary / farmer.

2

To encourage & support the farmers to use water testing kits / equipment in their farms

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References: 1. Centre for Monitoring Indian Economy (2001), Company Finance Marine Foods, Financial Aggregates & Ratios, CMIE, June, p.37 2. Centre for Monitoring Indian Economy (2003), Marine Products, Industr: Market size & shares, Centre for Monitoring Indian Economy, August, p.37 3. Planning Commission (1999), Ninth Five Year Plan, 1997-2002, Vol 1, Development goals, strategy & policies, Govt. of India, New Delhi. 4. Planning Commission (2002), Tenth Five Year Plan, 2002-2007, Vol II, Planning Commission, Govt. of India, New Delhi. 5. Planning Commission (2002), Tenth Five Year Plan, 2002-2007, Vol III, Planning Commission, Govt. of India, New Delhi.

6. www.fao.org 7. www.aquaculture.tn.nic.in 8. www.mpeda.com 9. www.thehindubusinessline.com 10. www.indiaimage.nic.in 11. www.dahd.nic.in/stat.htm 12. www.indiabudget.nic.in/es2003-04/tables.htm 13. www.agricoop.nic.in/stats.htm 14. www.enaca.org

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