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Variability : Unlike non agro industries, agro industries have to face variability in the quality of raw materials. This occurs because of changes in weather conditions and/or damage to crops and livestock from pests and diseases. There are also cyclic variations in availability of raw material.
These unique features of agro industries necessitate the industries' integration with farmers to secure raw material supply. Despite these constraints it is necessary that the Agro Industrial Sector delivers adequate return on invested capital by operating throughout the year to achieve acceptable rate of capacity utilization. |
| 1.7 |
Price competitiveness alone will not suffice as a tool of competitive advantage in an increasingly global market place. Processors and exporters of fresh produce to developed markets will have to deliver taste and quality demanded by those consumers. Hence, a twin pronged strategy of improving agricultural yields coupled with delivering the right quality to different markets will be necessary. |
| 1.8 |
Agro sector displays such characteristics, where only 'Process & Manufacture' cannot be taken as 'Industry', because agro processing industry can not be defined without backward linkage of food chain right upto the farm. The present definition of 'Industry' requires change in form by use of mechanical/chemical or any such process as is synonymous with 'Manufacturing'. Such definition may be appropriate for industries other than 'agro industries'. Agro Industries, may require certain quality of raw material and sometime, they have to effect modification in the raw material and/or increase its shelf life. Therefore, there is need to separately define 'agro industries' so that agro industries can get benefit of incentives available to thrust industries and accelerate investments in the sector. Various organizations such as World Bank, FAO (Food and Agriculture Organization), UNIDO , have defined agro industries keeping in view the value addition aspect. The definition of agro industries is thus defined as under: |
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