Industry status

Kerala budget: Giving plantations industrial status is a welcome decision | Kochi News

By: Shivdas B. Menon
The first comprehensive budget presented by Finance Minister KN Balagopal is not disappointing. He did a lot of homework, realizing the need for support for higher education, industry, tourism, plains and plantation agriculture, etc. All will agree that it is not easy to solve all the problems of the state after the floods of 2018. & 19 and two years of pandemic. Many industries have closed, construction activities have declined, tourists have stopped abruptly, Keralites have lost jobs in Gulf countries, etc.
MSMEs have suffered a lot from the pandemic and they need more help to survive. Some MSME units have benefited from Covid-related loans under credit guarantee schemes. But the repayment period is only three years, and the repayment of all units has already started, but the business has not accelerated, resulting in non-payment. The state government, through the KSIDC, is expected to provide working capital and term loans for a period of 10 years. This will help reduce NPAs and improve job creation.
Agriculture-related industries, including input manufacturing, should be encouraged by introducing start-up projects in agricultural schools. At present, most of the inputs for advanced agriculture, micro-irrigation system and packaging materials are sourced from other states.
Very pleased to see that the Minister of Finance has spent a lot of time with the Minister of Industry P Rajeeve to understand the immediate needs of the plantation sector which is facing a very difficult time. I want to commend Rajeeve for giving plantations industry status. Contrary to previous assurances, the Minister has already formed a plantation committee represented by various associations and he has taken their point of view to study and understand the necessary reforms. This budget will allow polyculture in plantations up to 10% of the land. This promise was also made earlier. Now, the industries are waiting for the implementation of the same by issuing directives to the local authorities so that the plantations do not encounter difficulties.
The government may need to see how plantations can enter into joint ventures (JVs) with supply companies, as investing in new crops can be difficult for cash-strapped plantations. Major reforms in the immediate future will not only help the plantation companies that were once profitable and will be a major revenue for the state.
The finance minister has allocated Rs 2 crore for bringing in global experts. The government has signed memorandums of understanding for “centres of excellence” with the Dutch government. This arrangement should be utilized when inviting floriculture/horticulture experts from Holland. Some Dutch companies may be interested in investments/JVs with plantation companies.
Agricultural sector
This budget allocated a reasonably large amount to agricultural projects such as support for paddy cultivation, jackfruit, vegetable cultivation, development of coconut, cashew, etc. Although the agents of the Department of Agriculture are good and committed, they need training from Israeli experts for high technology. cultivation. Agriculture should also be granted industrial status like plantations, as this would certainly bring better concentration in this sector. The overall allocation for agriculture is around Rs 900 crore, which may not be enough unless outside investment is encouraged in plantations and also in field crops.
One exciting thing I can see in this budget is that the minister mentions the PPP model in different projects including a food processing park (Cial model) funded by KIIFB.
Apart from using global experts for different projects, I also want to suggest bringing in experts from our private sector.
(Shivdas B Menon is former Chairman, CII-Kerala & MD Sterling Farm Research & Services Pvt Ltd)