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India’s horticulture sector is crucial to its agricultural economy, encompassing the cultivation, production, processing, and marketing of fruits, vegetables, and ornamental plants. The sector includes sub-sectors like pomology (fruit cultivation), olericulture (vegetable cultivation), floriculture (flower cultivation), and arboriculture (cultivation of trees). India stands as the second-largest producer of fruits and vegetables globally, trailing only China.

In 2023-24, India’s horticultural production was estimated at 355 million tonnes, surpassing food grain production. The sector contributes 33% to the agricultural Gross Value Added (GVA), growing at an annual rate of 4-5%, outpacing cereal production.

Despite its size and importance, India’s horticulture sector faces several challenges. Post-harvest losses are significant, with about 8.1% for fruits and 7.3% for vegetables, translating into a loss of ?1.53 trillion annually. These losses are primarily due to inadequate cold storage and processing infrastructure, as well as fragmented value chains, where middlemen dominate, resulting in low farmer incomes. Farmers typically receive only 30% of the final consumer price for their produce.

Challenges in India’s Horticulture Sector

• Infrastructure Deficit: The absence of efficient logistics, cold storage, and warehousing facilities contributes to delays and wastage of perishable horticultural crops. The cold storage capacity is concentrated in just a few states, limiting access for farmers across the country.
• Small Operational Landholdings: Many farmers operate on small plots, limiting their ability to adopt sustainable practices and crop rotation, leading to reduced yields and soil degradation.
• Limited Value Addition: Only 10% of India’s fruits and vegetables are processed, compared to 60-70% in developed countries, leading to distress sales and low earnings for farmers.
• Market Linkages and Export Challenges: Indian farmers have limited access to direct markets, and the country’s export share in horticultural produce is low. Non-tariff barriers such as Sanitary and Phytosanitary (SPS) standards also hinder India's export growth.

Government Initiatives for Horticulture

Several initiatives have been launched to address these challenges:

• Mission for Integrated Development of Horticulture (2014) aims to foster holistic growth through cluster approaches and better linkages.
• Operation Greens, initially focused on specific crops like tomatoes, onions, and potatoes, has been extended to all horticultural crops to address price volatility.
• The Farmer Producer Organisation (FPO) model is being promoted to help farmers collectively bargain for better prices. As of August 2024, 8,875 FPOs have been established with a target of 10,000 by 2027.
• The Agriculture Infrastructure Fund (AIF) provides financial support for cold chains, warehouses, and processing units.

Case Study: Sahyadri FPO

A notable example of FPO success is the Sahyadri Farmer Producer Company Ltd (SFPCL) in Maharashtra, which started with 10 farmers in 2004 and has grown to include 26,500 farmers across 252 villages. With an annual turnover of ?1,549 crore (2023-24), SFPCL has become the largest grape exporter, with 90% of exports going to the EU and UAE. Farmers involved in the FPO receive 55% of the final export price, significantly higher than the typical 30% in traditional markets. This model demonstrates the potential of cooperative farming in enhancing farmers' incomes.

Way Forward: Scaling Up the Amul Model

To replicate the success of AMUL in the dairy sector, India’s horticulture sector must focus on:

• Strengthening FPOs: Support should be provided for working capital, infrastructure, and digital integration. Leveraging platforms like the Open Network for Digital Commerce (ONDC) can enhance market access for FPOs.
• Expanding Processing and Storage Infrastructure: Financial allocation for cold storage, processing facilities, and logistics must be increased under schemes like Operation Greens.
• Public-Private Partnerships (PPP): Encourage collaborations between the government and private sectors to enhance food processing, distribution, and retail linkages.
• Technology Integration: Adoption of technologies like blockchain for traceability and AI-driven price prediction models can improve market transparency and reduce distress sales.

By expanding successful models like Sahyadri FPO, India can transform its horticulture sector, enhance farmer incomes, ensure food security, and increase agri-export earnings. This approach could play a pivotal role in rural development and poverty alleviation, benefiting both farmers and consumers.