Global Market and Local Players: A Value Chain System of Collaborative Strategies§

Since independence, different institutional arrangements have been tried to reorganize the land and production relations for bringing change in farming systems and enhancing crop yield of small farmers. But, these interventions have not been successful in bringing any meaningful improvement. Non-viability of small landholdings, inadequacies in the availability of inputs, poor extension and infrastructural support and insufficient marketing avenues have been found to be the primary reasons for the low crop productivity. However, it is believed that changes in institutional arrangements of land tenure system like land leasing, contract farming and corporate farming can make the small farms economically viable. By forging strategic alliance with farmers and banks, the corporate sector, which is known for its efficient management, can provide a sound business framework and prove to be a panacea for the ills of agricultural sector in general and small farmers in particular. The experience of some the Indian companies and multi-national companies are quite encouraging in this area. This paper has made an attempt to integrate small farmers and corporate sector and establish a link between small farmers and global market through effective value chain system. Besides, it has described the role of various players in the value chain and has discussed how the government, keeping the interests of the farmers in view, can facilitate greater participation of the corporate sector through appropriate policy framework.