Bonanza awaits floriculture industry

BANGALORE: There is a bonanza waiting for the Indian floriculture industry if the Commerce ministry had its way. It has proposed the implementation of the A F Ferguson report on financial rehabilitation of this sector.

Speaking to the media on the sidelines of the inauguration of the International Flower Auction centre, Mr K S Money, chairman of Agricultural & Processed Food Products Export Development Authority(APEDA) said that the rehabilitation package is estimated to cost about Rs 47 crore.

"The package covers a total of 39 units of which 16 units have already gone for the one-time settlement(OTS) scheme with commercial banks. The package will include the outstanding loan and overdue interest," he added. The average acreage of each unit is pegged around three acres.

Mr Money said that as a part of the package each unit would have to contribute 40% of the amount while the balance would be provided by APEDA by way of a grant to be repaid back to the agency over a period of seven to eight years. He said that APEDA would directly pay the banks/FIs, National Horticulture Board and not route the money through the units. In case of those units which had gone in for rehabilitation under the OTS, Mr Money said that Apeda would pay the fuel subsidy which had not been paid out to defaulting units since September 2002.

However Mr Money had a caveat saying that this was only at a proposal stage. "We have to still work out who would fund the exercise. Will we(Commerce ministry) have to pay for it or would the Union finance ministry provide some kind of budgetary support is yet to be work," he added.

Earlier speaking at the inauguration of the International Auction Centre, Union Commerce minister Kamal Nath noted that the floriculture industry in India was set for take-off thanks to the ongoing retail revolution in the country. " Organised retail is only 2.5% of the total Indian retail market, a figure which should go up. This will help the floriculture sector," he added.

Karnataka's CM H D Kumaraswamy said that the state was well-poised to become a major force in the agriculture/horticulture sector. Currently the state has 7 million hectares under horticulture cultivation with an annual production of over 100,000 tonnes worth Rs 8,500 crore.