Role of Finance in Indian Agriculture and Other Market

abhishreshthaa

Abhijeet S
Indian market - Agriculture


Market
Agricultural share in GDP – 26% (Rs. 5000 bn)


Large producer of cotton, cereals, sugar, fruits, spices etc
Current exports of about USD 4 bn


Specific commodity based exchanges – not very successful


Potential
Diverse gene pool and climatic conditions


Increase in agricultural exports – sugar, cereals


Increase in processed foods production & consumption


Impediments
Restrictions on inter state movement


Poor transport & warehousing – 30% wastage in cereals


Member controlled exchanges – transparency issues




Indian market – Other Metals

Market
Indian Production (Al, Cu & steel) – Rs. 600 bn



Largest exporter of iron ore and alumina


Large importer of copper


Current trade by negotiation / price setting by producers


Potential
Increased scope for aluminum & steel exports (as against alumina and iron ore)


Stable metal prices can fuel boom in downstream industries


Rival China as preferred manufacturing location


Growth in manufacturing to equal that in services




Impediments
No organised exchange in India – price discovery difficult


Significant PSU participation
 
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