Voluntary Report - public distribution

**Date:** 12/9/2005

**GAIN Report Number:** IN5130

IN5130

**India**

**Agricultural Situation**

**Weekly Highlights & Hot Bites, #45**

**2005**

**Approved by:**

![](media/image1.wmf)Michael Riedel

U.S. Embassy, New Delhi

**Prepared by:**

A. Govindan, Santosh Kr. Singh

**Report Highlights:**

\*Australian Wheat Board eyes wheat supply\*, \*Be cautious on Farm
talks - Opposition Parties\*, \*Pepsi plans domestic orange juice
production\*, \*Indian farm retail to get its first foreigners\*,
\*World Bank keen on Indian farm sector\*.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

New Delhi \[IN1\]

\[IN\]

Welcome to Hot Bites from India, a weekly summary of issues of interest
to the U.S. agricultural community. The report includes information that
has been garnered during travel within India, reported in the local
media, or offered by host country officials and agricultural analysts.
Press articles are included in this report. Significant issues will be
expanded upon in subsequent reports from this office.

DISCLAIMER: Any press summary contained herein does NOT reflect USDA's,
the U.S. Embassy's, or any other U.S. government agency's point of view
or official policy.

**AUSTRALIAN WHEAT BOARD EYES WHEAT SUPPLY**

India might import approximately one million tons of wheat in 2006 to
meet supply shortages, according to a top Australian Wheat Board (AWB)
official. \"It could be a million tons, a little more or little less, in
that order of magnitude, through 2006,\" said Mr. Andrew Lindberg,
AWB\'s Managing Director. \"Historically, Australia has been very well
placed to provide supplies into this market. Our premium wheat is sought
after in this market,\" Mr. Lindberg added. (Source: Business Line,
12/08/05)

**BE CAUTIOUS ON FARM TALKS -- OPPOSITION PARTIES**

At a meeting held by Commerce and Industry Minister Kamal Nath with
political opposition parties, the latter asked the government to move
cautiously on agriculture in order to protect the interests of Indian
farmers. They said the sector should not be opened unless developed
countries committed themselves to cuts in their agricultural subsidies.
"There was basically a meeting of the minds, as both sides \[government
and the opposition\] agreed that India had to move carefully on
agriculture, and that the interests of farmers had to be protected," a
senior government official said. Bharatiya Janta Party (the main
opposition party) General Secretary and former Commerce and Industry
Minister Arun Jaitley said "India should tighten its shield as far as
market access is concerned, taking care not to delink it from the
question of subsidies." Commerce Minister Nath, agreeing with Jaitley's
view, assured the opposition parties that India would not concede on
agriculture unless the developed countries agreed to real and
substantial cuts in their trade distorting support. (Source: Business
standard, 12/06/05)

**PEPSI PLANS DOMESTIC ORANGE JUICE PRODUCTION**

Pepsi wants to develop the rs. 5 billion (\$110 million) Indian orange
juice (OJ) market by getting into a direct-linkage, fully-integrated
production model, which would give India its own domestically-produced
OJ. Currently, the OJ-needs of India (around 5,000 tons a year) are met
by imports from Florida and Brazil. As part of their long-term
agribusiness investment plan, which would provide the much-needed
backward linkage, Pepsi is already managing and operating the biggest
citrus nursery in the world in Punjab state, which is likely to be
followed by two large Tropicana processing facilities there. (Source:
Economic Times, 12/09/05)

**INDIAN FARM RETAIL TO GET ITS FIRST FOREIGNERS**

AWB, an international commodity trading and risk management company, is
planning to invest in a chain of shops and warehouses in rural India.
This is the first time that a multinational company has shown interest
in the Indian farm retail segment instead of the high-end urban retail.
With an initial investment of Rs. 1 billion (\$22 million), the company
is planning to supply large supermarkets with private-label foods
through contract farming. The company set up a wholly-owned subsidiary,
AWB India, which is currently focusing on agri-commodity trading and
risk management. (Source: The Economic Times, 12/07/05)

**WORLD BANK KEEN ON INDIAN FARM SECTOR**

Expecting economic growth of eight percent for FY 2005/06, the World
Bank said it wanted to fund the Indian agricultural sector and
micro-finance, but wanted the government to allow greater foreign direct
investment and remove bottlenecks that restricted the private sector's
role. The Bank's activities have shifted to urban development and
infrastructure in recent years. (Source: Business Standard, 12/06/05)

# RECENT REPORTS SUBMITTED BY FAS/NEW DELHI

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  **REPORT    **SUBJECT**                             **DATE SUBMITTED**
  \#**                                                

  IN5129      Weekly Highlights & Hot Bites, #44      12/02/05
  ----------- --------------------------------------- -------------------

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