Agro-processing Industries: Their Importance, Contributions and Procurement Strategies

Abstract

This note defines agro-processing industries. It provides their contribution in national income and in value added from manufacturing in India. The note then goes on to discuss (a) the reasons for growing opportunities in these industries despite the fact that such industries relative importance declines in the process of economic development and (b) contributions that these industries make in the form of satisfying domestic demand, inducing agricultural growth, encouraging domestic industrial value added and employment, and earning valuable foreign exchange through exports. The note also conceptualizes four different types of raw material procurement strategies and the policies that would have potential to benefit these industries, and rural-lead industrialization.