Source: PIB
Subject: Horticulture
Context: The Union Budget 2026-27 has introduced a crop-specific, regionally differentiated strategy to accelerate the diversification into high-value crops across India’s coastal, North Eastern, and Himalayan regions.
About Accelerating India’s High-Value Crop Diversification:
What are High-Value Crops?
- High-value crops (HVCs) primarily refer to horticultural produce such as fruits, vegetables, flowers, spices, medicinal, and aromatic plants. They are termed high value because they generate significantly higher net returns per unit of land compared to traditional staple crops like cereals (wheat/rice) and pulses.
Data and Statistics on High-Value Crops
- Coconut Leadership: India ranks second globally in coconut production (22.44% of world total), supporting the livelihoods of approximately 30 million people.
- Export Strength: In 2024-25, cashew exports reached USD 369.17 million, while cocoa exports stood at USD 295.58 million.
- Horticulture Output: Total horticultural production grew to 370.74 million tonnes in 2024-25, far outstripping previous decades.
- Agarwood Dominance: India hosts nearly 150 million agarwood trees, with 90% concentrated in the North Eastern states, particularly Tripura and Assam.
Horticulture as a Driver of Agricultural Growth
- Economic Nucleus: Horticulture accounts for approximately 37% of the Gross Value Output (GVO) within the agricultural crops sub-sector.
- Global Standing: India is the world’s largest producer of onions and shallots (22.42% of global share) and ranks second in vegetables, fruits, and potatoes.
- Productivity Growth: Over the last decade, the sector has grown at 4.45%, the highest rate compared to traditional agriculture.
- Nutritional Security: Beyond income, HVCs provide essential vitamins and minerals, fuelling the agro-processing industry and improving national nutrition.
- Employment Engine: These crops are labour-intensive, creating significant local employment opportunities in rural and tribal areas.
Regionally Anchored Strategies:
- Coastal Regions (Coconut, Cashew, Cocoa, Sandalwood): Focused on replacing aging trees with high-yielding varieties and promoting Indian Cashew as a premium brand.
- North Eastern Region (Agarwood): Leveraging the Oud market with a potential ₹2,000 crore annual turnover in Tripura through sustainable cultivation and CITES-aligned export quotas.
- Himalayan/Hilly Regions (Walnuts, Almonds, Pine Nuts): Promoting high-density cultivation of Chilgoza (Pine nuts) and walnuts to boost tribal incomes in J&K and Himachal Pradesh.
- Intercropping Models: Promoting cocoa as an intercrop in coconut and arecanut plantations to utilize 40-50% sunlight penetration and provide extra income.
- Institutional Support: Utilizing bodies like the Coconut Development Board and Directorate of Cashewnut and Cocoa Development to modernize nurseries and train women in value addition.
Challenges Associated with Diversification:
- High Initial Investment: Transitioning to high-value perennials like sandalwood or agarwood requires significant capital and a long gestation period.
- Perishability: Unlike cereals, horticultural crops have a short shelf-life, necessitating advanced cold-chain infrastructure to prevent post-harvest losses.
- Climate Vulnerability: High-value crops in hilly regions (like walnuts and almonds) are highly sensitive to shifting snowfall patterns and temperature spikes.
- Fragmented Landholdings: Nearly 10 million coconut farmers operate on small plots, making it difficult to achieve economies of scale for processing.
- Quality Standardization: Meeting stringent international phytosanitary standards remains a hurdle for Indian HVCs to penetrate high-end markets in the EU and USA.
Way Ahead:
- Infrastructure Integration: Strengthening Post-Harvest Management (PHM) through the Mission for Integrated Development of Horticulture (MIDH) to reduce losses.
- Brand Building: Positioning Indian Sandalwood and Indian Cocoa as premium global brands by 2030 to command higher international prices.
- Farmer Producer Organizations (FPOs): Facilitating more Coconut and Cashew FPOs to organize fragmented sectors and improve bargaining power.
- Digital Mapping: Expanding the use of geospatial mapping for agarwood and high-density nut orchards to monitor growth and yield accurately.
- Rural Youth Participation: Encouraging rural youth and startups to engage in value-added processing (e.g., virgin coconut oil or fermented cocoa) to create a Gaon to Global value chain.
Conclusion:
India’s shift toward high-value crop diversification represents a move from subsistence farming to a commercially viable, export-oriented agricultural economy. By leveraging regional agro-climatic strengths through the Union Budget 2026-27, India is laying the foundation for a Viksit Bharat where farmers are global entrepreneurs.
