A

COMPREHENSIVE PROJECT REPORT

ON

“Scope for Exports of Agriculture

Product with Reference to Gujarat”

Prepared By
CHIKANI DHARA-217730592083
APARNA GHELANI-217730592076

(M.B.A. – SEMESTER III)

ACADEMIC YEAR 2016-2017

Sunshine Group of Institutions,
Faculty of Management,
Rajkot
Submitted To:
GUJARAT TECHNOLOGICAL UNIVERSITY

Under The Guidance Of

PROF .Abhipsa Vagadia

 PREFACE

As per the syllabus prescribed by GUJARAT TECHNOLOGICAL UNIVERSITY for MBA.

There is a Grand Project Study Course for the management course as the part of practical study
for the students. Theoretical knowledge and classroom discussion is not enough for a
management student to know the various areas of any business. And hence Grand Project Study
Course plays an important role to develop practical knowledge in students which makes them
aware about the opportunities and situations in the corporate world.

This will enable the students to explore an industry/organization, build a relationship with a
prospective employer, or simplify sharpen their skills in a familiar field. GP also provides
invaluable knowledge and networking experience to the students.
INSTITUTE CERTIFICATE
 ACKNOWLEDGEMENT

We would like to express my deepest gratitude to all those who had made this project possible.
We would also like to thank our project guide Pro.Abhipsa vagadia for effectively directing us in
our training activities. We would also like to thank all the other staff members of our college for
standing by side whenever we needed their help.

It was our pleasure that, we got a wonderful opportunity of preparing our Grand Project by
knowing the customer priorities and preferences; we have received all the necessary information
and a practical view of exports concern, which helped us to make our report the best one.
 DECLARATION

I undersigned Dhara chikani & Aparna Ghelnai Student of MBA, IV th Semester hereby declare
that the report for “Comprehensive Project Report” entitled “Scope for Exports of Agriculture
Product with Reference to Gujarat” is my own work and has been carried out under the
guidance by Prof. Abhpsa Vagadia of shri sunshine group of institution faculty of MBA- Rajkot.

Place: Rajkot Signature

Date: Dhara Chikani

Aparna Ghelani
CH. NO PARTICULARS PAGE NO
1 About the Sector/Industry

1.1 Overview of World Market

1.2 Overview of Indian Market
2 About major Players in the Sector/Industry

3 Introduction of the Study

3.1 Literature Review
3.2 Background of the Study
3.3 Problem Statement of the Study

3.4 Objectives of the Study

4 Research Methodology
4.1 Research Design
4.2 Sources of Data
4.3 Data Collection Method

4.4 Population
4.5 Sampling Method
4.6 Sampling Frame
4.7 Data Collection Instrument
5 Data Analysis & Interpretation
6 Results & Findings
7 Limitations of the Study
8 Suggestions

9 Conclusion
10 Bibliography
11 Annexure

1.1 OVERVIEW OF THE WORLD MARKET

 Agriculture and its allied activities engage 70% of the Indian population and contribute to
roughly 18% of the Indian Gross Domestic Product. 46 out of 60 soil types and 20 agro-climatic
regions exist in India. Compared to the world average of 11%, India has 52% cultivable land
spread across 1.84 million sq.km (more than that of China, USA, Japan). Indian agriculture is
wide spread with leading contributors in many areas. Production of food grains during 2011-12
is estimated at an all time record level of 250.42 MMT which is a significant achievement
mainly due to increase in the production of rice and wheat. .

India is among 15 leading exporters of agricultural products with a 1.7% share of world trade in
agriculture in 2010. With an export of USD 23.2 billion, India is expected to account for 5% of
the world's agriculture exports by 2014. The nation has emerged as world's top rice exporter
overtaking traditional leaders, Vietnam and Thailand. Increase in population and potential export
market will remain the key drivers of the growth in this sector.

Sector Spread on the Gujarat Map

Gujarat tops the agriculture growth table in the country with a CAGR of 10.7% over the last
decade. Around 65% of the total geographical area of 196 lac. hectares in Gujarat is cropped.
The state has seven agro-climatic zones and wide varieties of soil. The production of total food
grains witnessed ahigh growth, with a production of 10.1 MMT during 2010-11, as compared to
5.6 MMT in 2009-10. The state is also a leading contributor in the cotton production and
accounts for 31% of production in the country. The production of cotton during 2010-11 is at 9.8
million bales as against 7.4 million bales in 2009-10.

Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI); IBEF;
International Trade Statistics 2011, published by the World Trade Organization (WTO);
APEDA; National Institute of Food Technology Entrepreneurship and Management; Director
General of Commercial Intellig
ence & Statistics
Agricultural Exports Exports from India are broadly classified into several categories like
agriculture and allied products, oils and minerals, manufactured goods, mineral fuel etc. Among
them, agriculture and allied products occupied significant place in the total export earning of the
country. Agriculture and allied products alone contributed per cent of the total export earning of
India in 1970-71, which fell down to 30.6 percent in 1980-8 1 (Ruddar Datt and K P M
~undhararn)
 1.2 OVERVIEW OF GUJARAT MARKET

India's Imports and Exports of Agricultural Commodities Total National Exports

(Value Crore)
Year Agriculture Total National %age Agriculture

Exports Exports Exports to Total National

Exports
2003-04 28657.37 201356.45 14.23

2005-06 29728.61 209017.97 14.22

2006-07 34653.94 255137.28 13.58

2008-09 37266.52 293366.75 12.70

2009-10 41602.65 375339.53 11.08

2010-11 49216.96 456417.86 10.78

2011-12 62411.42 571779.28 10.92

2012-13 79039.72 655863.52 12.05

2013-14 85951.67 840755.06 10.22

2014-15 89341.33 845533.64 10.57

2015-16 120185.48 1148169.56 10.47

 2. ABOT MAJOR PLAYER IN THE SECTOR

uring the second half of the 1990s, a strong and steady growth in the sales of organic foods has
provided these products with a viable and sometimes value added market niche. Changes in
dietary habits among many segments of the population of developed countries - resulting from
increased health awareness and the increasing demand for a wider variety of products, including
convenience food - have contributed to this growth. Due to major food scares, which hit many
countries in western Europe in the late 1990s and early years of this century, consumers in
general have become more critical when purchasing food. Moreover, they have become more
demanding regarding information on production and processing aspects (including tracability of
the product). The sales of organic horticultural products have been expanding rapidly in many of
the major organic markets (e.g. the United States, countries in the European Community and
Japan). However, the market share of organic products in total food sales is still small, with
shares ranging between one and three percent.

The economies of many developing countries are dependent on the export of a relatively small
number of (mostly agricultural) commodities. Several of these commodities (e.g. bananas and
sugar) are likely to face further market liberalization pressure in the near future. As a result,
diversification of agricultural production is more than ever of utmost importance. Diversification
towards high-value crops can help to reduce the vulnerability of many agricultural producers in
those countries, especially for resource poor and small scale farmers.

Despite ongoing conversion towards more sustainable farming methods in developed countries
and government support to further boost organic production, consumption of organic foods is
expected to continue to outgrow domestic production in developed countries, leaving room for
significant organic imports, at least in the short- to medium-term and probably beyond.
Moreover, tropical and off-season products will continue to provide an attractive potential for
which many developing countries have comparative advantages.

Customs and regulatory authorities have not made a distinction between organic and
conventional food products, resulting in a lack of reliable information on organic horticultural
market development and internationally traded volumes. Decision-makers in the public and
private sector in developing countries therefore lack the necessary information on which
decisions should be taken concerning conversion towards organic production. The development
of demand for organic products, the type of products and anticipated prices are key issues when
deciding on conversion.

This publication aims at contributing to filling that information gap. It provides detailed
information on organic horticultural market development and global trade in fresh organic fruit
and vegetables. The study gives quantitative and qualitative information on the demand in the
main developed markets, organic production and import figures. Moreover, it provides case
studies of seven developing countries which have established an organic export sector or have
the potential to do so. These case studies may provide useful insights on how to establish a
successful organic export sector, and also discuss possible difficulties that need to be tackled.
 3.1 LITERATURE REVIEW

1. SamarK.Datta( 2009).

Samar K. Data discusses issues related to India’s non-trade concerns (mainly food security
and environmental aspects) and trade matters (import and export competitiveness) and provides
an economists critique of WTO framework. He then attempts to spell out appropriate domestic
reform measures and international negotiations strategies to be pursued by India in order to meet
the challenge to Indian agriculture posed by the process of globalization and to convert threats
into opportunities for developing agriculture and enhancing export earnings.

2. RameshChanda (2008).

This book (Trade Liberalization, WTO And Indian Agriculture ) is an outcome of the series
of research studies undertaken by the author on the theme of WTO, Trade Liberalisation and
Indian Agriculture during the last six years. The book compares trade performance and trade
flows of agricultural commodities in pre and post WTO period to find the impact of Uruguay
Round Agreement on India's agricultural trade. The author presents in depth analysis of behavior
of international prices and discusses implications of volatility in international prices for domestic
agriculture under liberalized trade. The book explains the role of WTO and cyclical nature of
international prices in affecting Indian agriculture and its competitiveness. Contentious issues in
trade and in implementation of Agreement on Agriculture (AOA) and strategy for future
negotiations are discussed in detail. The author emphasizes changes in domestic infrastructural,
institutional and legal framework to improve competitiveness of Indian agriculture and its
capability to face the threats and opportunities thrown by the new trade agreement. The book
presents factual position relating to global agricultural trade before and after WTO and broad
issues concerning developing countries. Issue of food security in relation to trade liberalisation
has been addressed separately. Policy conclusions and future strategy for adjusting to post WTO
situation are presented towards the end.
3. Swaminathan (2010).

Discusses about Indian agricultural crisis through “Why Indian farmers need WTO” Now
a day’s agriculture crisis in India is excess of production and not the shortage of production.
We have a food grain mountain of over 60 million tonnes, as well as a mountain of unsold
sugar. The transformation from scarcity to excess should have made India a great agricultural
exporter. Instead, Indian farmers are angry and fell in misery. Exporting is reduced because of
global agricultural prices have been falling for two decades It shows that between 1980 and
2001, the price of rice crashed from $571/tonne to $179/tonne; of wheat from $219/tonne to
$131/tonne. The same step downtrend is evident in other agricultural commodities like cotton,
sugar, coffee, soya been, maize, tea, rubber, beef, coconut oil or palm oil. This was happened
because of every country in the world has subsidized agriculture so much for so long that
surpluses have grown everywhere. As incomes rise, people spend an ever smaller proportion
of income on foods. Meanwhile, the spread of new technology the world over has
revolutionized farm yields. The combination has meant rising gluts. Some countries have
diversified into non-traditional crops, creating further surpluses.. They force governments to
keep subsidies and import tariffs high. Every country is subsidizing exports at less than cost,
so prices are crashing. In such circumstances, global prices represent massive dumping.
Obviously, India needs to diversify out of agriculture into industry and services. But 60 per
cent of the population is still mainly in agriculture, and cannot be redeployed quickly. Besides,
modern technology keeps reducing the employment potential of industry, and indeed of
agriculture. So our agricultural crisis is becoming an employment crisis. In sum, few things
are more important for India than a globally agreed reduction in agricultural subsidies under
the WTO. Predictably, India’s own stand at the WTO has been myopic and hypocritical. He
concludes that Indian farmers do not need ever- rising subsidies. What they need is freer
international trade. That is the path to prosperity.
4. Hema Garg( 2004)

This book (WTO and Regionalism in World Trade) examines and evaluates the impact of
the establishment of WTO and the various regional trading blocs on the pattern and development
of international trade. It describes the interface between the new rules of international trade
given by the WTO and the requirements of different trading blocks. The trading blocks focused
on are: European Union (EU) in Europe, Association of South East Asian Nations (ASEAN),
South Asian Free Trade Area (SAFTA), Asia Pacific Economic Co-operation (APEC) in Asia,
and North American Free Trade Areas (NAFTA) and Common Market of the Southern Cone
(MERCOSUR) in Americas. WTO is expected to administer its trade agreements, provide forum
for trade negotiations, handle trade disputes, monitor national.

5. M.M. Sury( 2004)

This book (Indian Economy in the 21st Century: Prospects and Challenges) explains
the key reform measures undertaken in various sectors of the Indian economy since 1991. It
examines their rationale, contents, and impact. Furthermore, the work puts in perspective the
emerging lessons for the future. To provide the necessary backdrop to the new order, appropriate
comparisons are made with the policies pursued prior to reforms period. However, the focus of
the study is on current scenario and future prospects in various sectors of the Indian economy.
The overall approach to the subject is descriptive, analytical, and at places normative.

The new Government at the Centre, which assumed office in May 2004, has given enough
indications, through its Common Minimum Programme (CMP) [later rechristened as National
Common Minimum Programme (NCMP)] and the 2004-05 budget proposals presented to
Parliament on July 8, 2004, that it intends to proceed further with the economic reforms
programme underway.
 3.2 BACKGROND OF THE STUDY

This study focuses on fresh certified organic fruit and vegetables (both temperate and tropical).
For some countries where other organic products (e.g. processed and frozen vegetables) are of
significant importance, short sections on these products are included.

Market analysis has been carried out in the following developed markets: Austria, Belgium,
Denmark, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland, the United
Kingdom and the United States of America. Case studies on the (potential) organic export sector
in developing countries include: Argentina, Cameroon, Chile, the Dominican Republic,
Madagascar, Papua New Guinea and Zambia.
 3.3 PROBLEM STATEMENT OF THE STUDY

Agri-products are defined to include products of agriculture & allied activities, fishing, forestry,
and manufacturing industries, like food & food products, tobacco, textiles, paper, furniture, etc.
Gujarat has a revealed comparative advantage in the exporting activity over the other states
since, as per GITCO Study (November 2010), more than 150 of the exports of the country
originate from Gujarat. Based on the large sample survey conducted by GITCO (November
2010), several features of the exports originating from Gujarat are also examined. Exports of
agri-products originating from Gujarat represent excess supply rather than exclusive supply to
the foreign markets.

In spite of free trade agreements and privileges for exporting of agri-product are not increased.
At international level there is higher demand of Gujarat regional agri-product but due to
inappropriate knowledge of selling their products at international level and the benefits they can
be received from exporting of goods are not available to them. There are many problems they are
facing like procedures for documentation of exporting good from India, language barriers while
communicating with foreign potential buyers, Lack of marketing skills required for a person who
is handling international sales in farmer, inability to do market research for internationalization,
unaware about benefits and supporting assistance provided by government of India. Apart from
this there is continuous upgrading of production, induction of technology, labor law reforms and
employment issues, research and development issues and needs, change of fiscal and policy
parameters, Gujarat has a very vibrant and responsive agricultural sector. It has an achievable
potential to grow at 4.5% to 5% p.a. over the next 8 to 10 years.
 3.4 OBJECTIVE OF THE STUDY

 To study the scope of agriculture product export in near future.

 To study the export opportunity for the company in favour to increase the profit.
 To know the future growth of the agriculture industry due to export.
4.1 SOURCE OF DATA