Jai Kisan vs 2.0:New FTP chapter to be farm-friendly

NEW DELHI: The government���s focus on agriculture and farmers is all set to go beyond the Budget proposals announced last month. The annual supplement to the foreign trade policy (FTP) to be announced early next month is likely to have several farmer-friendly provisions. Prominent among them is the possible expansion of the scope of the Vishesh Krishi & Gram Udyog Yojana (VKGUY) by including more products under the export promotion scheme.

The scheme, which grants duty-free scrips of 5% against exports of identified agro-based products, might be expanded to include plantation crops like tea, coffee and cashew, sources said. There is also a possibility of including flowers in the list.

The agriculture ministry is pushing for incorporation of sugar in the scheme, but the commerce department is not keen as sugar exports already benefit under the existing export assistance scheme for the commodity.

The VKGUY was introduced in 2006-07 granting duty-free scrips of 5% against exports of 25 agro-based products like handmade paper, agarbatties, ayurvedic, unani and siddha medicines and room deodorants. Last year, the scheme got a shot in the arm when it was expanded to include exports of value-added variants of farm and forest products. These included coconut oil, soyabean oil, potato flakes, meals and flours, cardamom, food preparations like soups, sauces, artistic wooden furniture, herbal extracts of forest products and malt and minor forest produce. The provision for the scheme was enhanced from Rs 300 crore to Rs 500 crore.

���This year, the scope may be further expanded by including more products and the provision for the scheme would also be raised to match demand,��� an official said.

Other measures to boost farm produce might also be announced to incentivise processed food industry and building of agriculture infrastructure. Last year, a scheme was introduced for incentivising agro processing which rewarded status holding exporters with duty credit scrips equal to 10% of the value of agricultural exports, provided they used them for duty redemption on imports of cold storage, pack houses and refrigerated vans.