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RSTV: POLICY WATCH- ONE DISTRICT ONE PRODUCT SCHEME

RSTV


Introduction:

One District One Product is an initiative that is seen as a transformational step forward towards realizing the true potential of a district, fuel economic growth, and generate employment and rural entrepreneurship, taking us to the goal of AtmaNirbhar Bharat. The objective is to identify one product per district based on the potential and strength of a district and national priorities, develop a cluster for that product in the district which is capable of producing a world-class product with quality, scalability, and a brand and also provide market linkages. This scheme is basically a Japanese business development concept, which gained prominence in 1979. It is aimed at promoting a competitive and staple product from a specific area to push sales and improve the standard of living of the local population. Over time, it has been replicated in other Asian countries as well.

About:

  • The scheme adopts the One District One Product (ODOP) approach to reap the benefit of scale in terms of procurement of inputs, availing common services and marketing of products. ODOP for the scheme will provide the framework for value chain development and alignment of support infrastructure. There may be more than one cluster of ODOP products in one district. There may be a cluster of ODOP products consisting of more than one adjacent district in a State.
  • ODOP is aimed at giving a major push to traditional industries synonymous with the respective districts of the state.
  • The objective of the ODOP is to optimise production, productivity and income, preservation and development of local crafts, promotion of art, improvement in product quality and skill development.
  • The States would identify the food product for a district, keeping in perspective the focus of the scheme on perishables. A baseline study would be carried out by the State Government.
  • The ODOP product could be a perishable Agri produce, cereal-based product, or a food product widely produced in a district and their allied sectors. An illustrative list of such products includes mango, potato, litchi, tomato, tapioca, kinnu, bhujia, petha, papad, pickle, millet-based products, fisheries, poultry, meat as well as animal feed among others.
  • Besides, certain other traditional and innovative products including waste to wealth products could be supported under the Scheme. For example, honey, minor forest products in tribal areas, traditional Indian herbal edible items like turmeric, amla, haldi, etc.
  • Support for agricultural products would be for their processing along with efforts to reduce wastage, proper assaying, and storage and marketing.
  • For providing support existing individual micro-units for capital investment, preference would be given to those producing ODOP products. However, existing units producing other products would also be supported. In the case of capital investment by groups, predominately those involved in ODOP products would be supported.
  • Support to groups processing other products in such districts would only be for those already processing those products and with adequate technical, financial, and entrepreneurial strength. New units, whether for individuals or groups would only be supported for ODOP products.
  • Support for common infrastructure and marketing & branding would only be for ODOP products. In case of support for marketing & branding at the State or regional level, the same products of districts not having that product as ODOP could also be included.
  • The Department of Commerce is focusing on agriculture crops on a cluster approach for support for exports under the Agriculture Export Policy, and the Ministry of Agriculture is also focusing on a cluster approach for the development of specific agriproducts in districts having a comparative advantage. The ODOP approach of the scheme would lead to easing in providing common facilities and other support services.

Background:

ODOP is basically a Japanese business development concept, which gained prominence in 1979. It is aimed at promoting a competitive and staple product from a specific area to push sales and improve the standard of living of the local population. Over time, it has been replicated in other Asian countries as well.

The main objectives of the One District One Product Scheme of UP are as follows:

  • Preservation and development of local crafts / skills and promotion of the art.
  • Increase in the incomes and local employment (resulting in decline in migration for employment).
  • Improvement in product quality and skill development.
  • Transforming the products in an artistic way (through packaging, branding).
  • To connect the production with tourism (Live demo and sales outlet – gifts and souvenir).
  • To resolve the issues of economic difference and regional imbalance.
  • To take the concept of ODOP to national and international level after successful implementation at State level.

Government Announces:

  • With the aim to boost export of agriculture products, the Centre has identified several products under 15 broad categories, allotting one product for each of the country’s 728 districts so that there is convergence of resources under different schemes of various ministries and also it helps increase farmers’ income.
  • The products have been identified from agricultural, horticultural, animal, poultry, milk, fisheries, aquaculture, marine sectors across the country after taking inputs from the states, Union Territories and the Indian Council of Agricultural Research (ICAR).
  • These products need to be promoted in a cluster approach through convergence of the Government of India schemes to increase the value of the products and with the ultimate aim of increasing the income of the farmers.
  • These identified products will be supported under the PM-FME scheme of the Ministry of Food Processing Industries, which provides incentives to promoter and micro-enterprises.
  • It took almost nine months to design after Prime Minister, during his interaction with officials in May last year on ways to boost the agriculture sector, underlined the importance of developing Brand India for which agri-clusters can be promoted.
  • The government has already set a target to achieve $60 billion agri exports by FY22.
  • Under the Rs 10,000-crore FME scheme, launched last year, two lakh micro-enterprises are targeted to be assisted with credit-linked subsidy over a five-year period to help create infrastructure and marketing of these ODOFP products.
  • The unorganised food processing sector has nearly 25 lakh units (66% located in rural areas), which contribute to 74% of the total employment in the sector, while the remaining 25% work in the organised industries.
  • However, the success of the programme hinges on allowing entrepreneurs to directly purchase those products in each specified district.
  • Since the implementation of the three farm laws has been stayed by the Supreme Court, states can suitably make changes in the Rules under their respective APMC Act so that entrepreneurs are allowed to buy directly from farmers, an agriculture ministry official said, adding there should not be any tax/cess on the ODOFP products as those are meant for export.
  • Kadapa and Anantapur districts in Andhra Pradesh were identified for banana exports as part of a commerce ministry plan in 2018 to develop 50 districts as exports clusters.
  • However, there were difficulties to sell bananas even in the domestic market after the lockdown was announced last year and finally the agriculture ministry made arrangement to sell those in other states.
  • On the other hand, items like non-basmati rice performed well as the country had exported more during April-September of FY21 than the quantity shipped in entire FY20.