Despite of increased output and productivity, there is a demand –supply gap in the oilseeds in India, particularly in Edible oils. While analyzing the reasons, discuss the steps that should be taken to address the issue.
Published: August 31, 2017
India is one of the largest oilseeds producers, despite that fact, India is unable to meet its domestic edible oil requirements. Due to huge Demand supply gap, there is import dependency in case of edible oils. Presently, India is world’s largest importer of edible oil. Situation aggravates during the poor monsoon years, which impact the yield of the oilseed.
Reasons for gap in demand-supply
Because domestic demand is rising rapidly at the rate of 6% per year but domestic production growth is only 2% per annum. Low productivity is another reason, the average yields of most oilseeds are very low when compared with other countries of the world. Productivity is poor because oilseeds are largely produced in rain-fed areas. Only 1/4 of the oilseed producing area in under irrigation. Oil seed cultivation is considered risky due to uncertain returns.
Measures to improve Oilseed Production
More and more oilseed areas should be under irrigation, this will help in improving productivity. There should be a focus on modern crop technology and better dry farming & the scope of research should be enlarged, along with technology diffusion. Incentives should be provided to the private sector for participation in processing and value addition in oilseed crops. Also, steps should be taken for capacity utilization& market reforms and policies, such as contract farming and public-private partnership in production and processing, to ensure a competitive market for oilseeds.
There is need to strengthen the oilseed crop seed chain, the focus should be on policies which support all stakeholders and strike a harmonious balance.
Model Questions Category: 069 - Public Distribution System Buffer Stocks and Food Security