of 3. 6 percent over the last decade. total horticulture production also reached an all - time high of 320 million tonnes, growing at an annual average rate of 4. 4 percent over the last 10 years. india is now one of the leading producers of milk, cereals, pulses, vegetables, fruits, cotton, sugarcane, fish, poultry and livestock in the world. buffer stocks in cereals currently stand at 91. 6 million tonnes or 2. 2 times the buffer norm. these achievements represent, in my view, the most vivid silver lining in the current environment. 5. shifting the terms of trade in favour of agriculture is the key to sustaining this dynamic change and generating positive supply responses in agriculture. experience shows that in periods when terms of trade remained favourable to agriculture, the annual average growth in agricultural gross value added ( gva ) exceeds 3 per cent. hitherto, the main instrument has been minimum support prices, but the experience has been that price incentives have been costly, inefficient and even distortive. india has now reached a stage in which surplus management has become a major challenge. we need to move now to policy strategies that ensure a sustained increase in farmers ’ income alongside reasonable food prices for consumers. 6. an efficient domestic supply chain becomes critical here. accordingly, the focus must now turn to capitalising on the major reforms that are underway to facilitate domestic free trade in 1 / 5 bis central bankers'speeches agriculture. first, the amendment of the essential commodities act ( eca ) is expected to encourage private investment in supply chain infrastructure, including warehouses, cold storages and marketplaces. second, the farmers ’ produce trade and commerce ( promotion and facilitation ) ordinance, 2020 is aimed at facilitating barrier - free trade in agriculture produce. third, the farmers ( empowerment and protection ) agreement on price assurance and farm services ordinance, 2020 will empower farmers to engage with processors, aggregators, wholesalers, large retailers, and exporters in an effective and transparent manner. with this enabling legislative framework, the focus must turn to ( a ) crop diversification, deemphasising water - guzzlers ; ( b ) food processing that enhances shelf life of farm produce and minimises post - harvest wastes ; ( c ) agricultural exports which enable the indian farmer take advantage of international terms of trade and technology ; and ( d ) public and private capital formation in the farm sector. the committee on doubling farmers income

% of the investment portfolio, both in the afs and hft categories plus a 2. 5 % risk weight on the entire investment portfolio - whereas basel norms take into account only the trading portfolio. rbi ’ s involvement in basel ii rbi ’ s association with the basel committee on banking supervision dates back to 1997 as india was among the 16 non - member countries that were consulted in the drafting of the basel core principles. reserve bank of india became a member of the core principles liaison group in 1998 and subsequently became a member of the core principles working group on capital. within the cpwg, rbi has been actively participating in the deliberations on the accord and had the privilege to lead a group of 6 major non g - 10 supervisors which presented a proposal on a simplified approach for basel ii to the committee. the basel committee on banking supervision is yet to issue the final basel ii document. the reserve bank ’ s comments on the 3rd consultative document on the new capital accord on the basis of the quantitative impact studies ( qis 3 ) undertaken in co - ordination with select banks has brought out the need for more simplicity and greater flexibility on account of the different levels of preparedness of the banking system in india. policy approach in general, keeping in view the rbi ’ s goal to have consistency and harmony with international standards and our approach to adopt the pace as may be appropriate in the context of our country specific needs, the rbi had in april 2003 itself accepted in principle to adopt the new capital accord basel ii. the rbi has announced, in its annual policy statement in may 2004 that banks in india should examine in depth the options available under basel ii and draw a road - map by end december 2004 for migration to basel ii and review the progress made thereof at quarterly intervals. the reserve bank will be closely monitoring the progress made by banks in this direction. hence, at a minimum all banks in india, to begin with, will adopt standardized approach for credit risk and basic indicator approach for operational risk. after adequate skills are developed, both in banks and at supervisory levels, some banks may be allowed to migrate to irb approach. regulatory initiatives the regulatory initiatives taken by the reserve bank of india include : • ensuring that the banks have suitable risk management framework oriented towards their requirements dictated by the size and complexity of business, risk philosophy, market perceptions and the expected level of capital. the framework adopted by banks would need to be adaptable to changes in business size, market dynamics and introduction of innovative products by banks