Lok Sabha Question No. 291 (UNSTARRED), answered on 2016-04-26
Subject: FDI in Agricultural Sector
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: JAGDAMBIKA PAL

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA

## UNSTARRED QUESTION NO. 291

TO BE ANSWERED ON THE 26 TH  APRIL, 2016

## FDI IN AGRICULTURAL SECTOR

291.   SHRI JAGDAMBIKA PAL:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ षि एवं ककसान कल्याण मंत्री be pleased to state:

- (a) whether FDI is permitted in the agricultural sector in the country and if so, the details thereof, activity-wise;
- (b) the  details  of  agricultural  activities  where  FDI  is  not  allowed  along  with  the  reasons therefor;
- (c) whether  the  Government  has  taken  any  steps  to  identify  the  impact  of  FDI  in agricultural sector and if so, the details and outcome thereof; and
- (d) the inflow of FDI in the agriculture sector in the country during the last three years, Sector-wise?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND FARMERS WELFARE

कृ षि एवं ककसान कल्याण मंत्राऱय में राज्य मंत्री (SHRI  MOHANBHAI  KUNDARIYA)

- (a): FDI up to 100 percent is permitted under automatic route in specified activities of the agriculture  and  allied  sectors.  The  details  as  per  para  6.2.1  of  'Consolidated  FDI  Policy Circular of 2015' are at Annexure I. Further, 100 percent FDI is also allowed under automatic route in the plantation sector namely tea, coffee, rubber, cardamom, palm oil tree and olive oil tree.
- (b): Besides  the  above,  FDI  is  not  allowed  in  any  other  agriculture  activities/sector  to safeguard the interests of poor farmers of our country for whom agriculture is mainstay of livelihood.
- (c): No steps have been taken by Government in this regard.
- (d): The FDI inflows from April 2012 to February 2016 is at Annexure -II.

## ANNEXURE-I

| Para 6.2.1 of ' Consolidated FDI Policy Circular of 2015' on Agriculture   | Para 6.2.1 of ' Consolidated FDI Policy Circular of 2015' on Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Para 6.2.1 of ' Consolidated FDI Policy Circular of 2015' on Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Para 6.2.1 of ' Consolidated FDI Policy Circular of 2015' on Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
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| Sl. No.                                                                    | Sector/Activity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | % of Equity/ FDI Cap                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Entry Route                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Agriculture                                                                | Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Agriculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 6.2.1                                                                      | Agriculture &Animal Husbandry a) Floriculture, Horticulture, Apiculture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 100%                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Automatic                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 6.2.1.1                                                                    | Other Conditions :                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Other Conditions :                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Other Conditions :                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                                                            | I. For companies dealing with development of transgenic seeds/vegetables, the following conditions apply: (i) When dealing with genetically modified seeds or planting material the company shall comply with safety requirements in accordance with laws enacted under the Environment (Protection) Act on the genetically modified organisms. (ii) Any import of genetically modified materials if required shall be subject to the conditions laid down vide Notifications issued under Foreign Trade (Development and Regulation) Act, 1992. (iii) The company shall comply with any other Law, Regulation or Policy governing genetically modified material in force from time to time. (iv)Undertaking of business activities involving the use of genetically engineered cells and material shall be subject to the receipt of approvals from Genetic Engineering Approval Committee (GEAC) and Review Committee on Genetic Manipulation (RCGM). (v) Import of materials shall be in accordance with National Seeds Policy. II. The term 'under controlled conditions' covers the following: (i) 'Cultivation under controlled conditions' for the categories of floriculture, horticulture, cultivation of vegetables and mushrooms is the practice of cultivation wherein rainfall, temperature, solar radiation, air humidity and culture medium are controlled artificially. Control in these parameters may be effected through protected cultivation under green houses, net houses, poly houses or any other improved infrastructure facilities where micro-climatic conditions are | I. For companies dealing with development of transgenic seeds/vegetables, the following conditions apply: (i) When dealing with genetically modified seeds or planting material the company shall comply with safety requirements in accordance with laws enacted under the Environment (Protection) Act on the genetically modified organisms. (ii) Any import of genetically modified materials if required shall be subject to the conditions laid down vide Notifications issued under Foreign Trade (Development and Regulation) Act, 1992. (iii) The company shall comply with any other Law, Regulation or Policy governing genetically modified material in force from time to time. (iv)Undertaking of business activities involving the use of genetically engineered cells and material shall be subject to the receipt of approvals from Genetic Engineering Approval Committee (GEAC) and Review Committee on Genetic Manipulation (RCGM). (v) Import of materials shall be in accordance with National Seeds Policy. II. The term 'under controlled conditions' covers the following: (i) 'Cultivation under controlled conditions' for the categories of floriculture, horticulture, cultivation of vegetables and mushrooms is the practice of cultivation wherein rainfall, temperature, solar radiation, air humidity and culture medium are controlled artificially. Control in these parameters may be effected through protected cultivation under green houses, net houses, poly houses or any other improved infrastructure facilities where micro-climatic conditions are | I. For companies dealing with development of transgenic seeds/vegetables, the following conditions apply: (i) When dealing with genetically modified seeds or planting material the company shall comply with safety requirements in accordance with laws enacted under the Environment (Protection) Act on the genetically modified organisms. (ii) Any import of genetically modified materials if required shall be subject to the conditions laid down vide Notifications issued under Foreign Trade (Development and Regulation) Act, 1992. (iii) The company shall comply with any other Law, Regulation or Policy governing genetically modified material in force from time to time. (iv)Undertaking of business activities involving the use of genetically engineered cells and material shall be subject to the receipt of approvals from Genetic Engineering Approval Committee (GEAC) and Review Committee on Genetic Manipulation (RCGM). (v) Import of materials shall be in accordance with National Seeds Policy. II. The term 'under controlled conditions' covers the following: (i) 'Cultivation under controlled conditions' for the categories of floriculture, horticulture, cultivation of vegetables and mushrooms is the practice of cultivation wherein rainfall, temperature, solar radiation, air humidity and culture medium are controlled artificially. Control in these parameters may be effected through protected cultivation under green houses, net houses, poly houses or any other improved infrastructure facilities where micro-climatic conditions are |

temperature/humidity management), health care and nutrition, herd registering/pedigree recording, use of machinery, waste management systems as prescribed by the National Livestock Policy, 2013 and in conformity with the existing 'Standard Operating Practices and Minimum Standard Protocol.'

- (b) Poultry  breeding  farms  and  hatcheries  where  micro-climate  is  controlled through advanced technologies like incubators, ventilation systems etc.

(iii)In  the  case  of  pisciculture  and  aquaculture,  scope  of  the  term  'under  controlled conditions' covers -

- (a) Aquariums
- (b) Hatcheries  where  eggs  are  artificially  fertilized  and  fry  are  hatched  and incubated in an enclosed environment with artificial climate control.
- (iv) In the case of apiculture, scope of the term 'under controlled conditions' covers -
- (a) Production  of  honey  by  bee-keeping,  except  in  forest/wild,  in  designated spaces  with  control  of  temperatures  and  climatic  factors  like  humidity  and artificial feeding during lean seasons.

| Para 6.2.2   | Plantation                                                                                                                                                                                                                                                          | Plantation         | Plantation   |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------|--------------|
|              | Sector/ Activity                                                                                                                                                                                                                                                    | %of Equity FDI Cap | Entry Route  |
|              | (i) Tea sector including tea plantation (ii) Coffee plantations (iii)Rubber plantations (iv)Cardamom plantations (v) Palm oil tree plantations (vi)Olive oil tree plantations Note: Besides the above, FDI is not allowed in any other plantation sector/ activity. | 100%               | Automatic    |

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Annexure-II

## The FDI inflows from April 2012 to February 2016 in agriculture sector are as under:

| Sl No   | Year (Apr-Mar)                   | FDI (in Rs crore)   |   FDI (in US$ million) |
|---------|----------------------------------|---------------------|------------------------|
| 1       | 2012-13                          | 875.90              |                 161.47 |
| 2       | 2013-14                          | 559.66              |                  91.01 |
| 3       | 2014-15                          | 365.31              |                  59.95 |
| 4       | 2015-16 (Apr, 2015 to Feb, 2016) | 553.14              |                  84.65 |
|         | Grand Total                      | 2,354.02            |                 397.08 |

Source: DIPP