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Punjab Agri Ventures Limited
 


Punjab Agri Food Invests Rs 300 Cr
Sept 7, 2006

When most of the food-processing players are coming to Punjab to set up shop, a Punjab-based service provider to the food industry, Punjab Agri Food Parks Ltd (PAFPL), has decided to spread its operations in Uttaranchal, Karnataka, Gujarat and Rajasthan.

"The reason behind this expansion is facilitating our customers based in different parts of India,"" said Ankush Aggarwal, Managing director of PAFPL.

The investments at the new locations will be a replication of the model executed in Punjab. The company implemented a hub-and-spoke model at Fatehgarh Sahib in Punjab where a hub was built in 25 acres and spoke centres were smaller.

"The final investment at Fatehgarh Sahib will be about Rs 100 crore and the project will be completed by next year. A total investment of about Rs 300 crore (Rs 75 crore each for four facilities) will be made in the upcoming centres. The company proposes to fund new investments through a mix of internal accural, debt and equity. Venture capital firms are interested in funding the new projects," said Aggarwal.

The investment in Punjab was slightly higher than other set-ups because Punjab had multi-dimensional crop structure and it accommodated the produce from Himachal Pradesh, said Aggarwal.

Future Plans for the Project

  • Punjab Agri Food Parks Ltd has decided to spread its operations in Uttaranchal, Karnataka, Gujarat and Rajasthan.
  • The final investment at Fatehgarh Sahib will be about Rs 100 crore and the project will be completed by next year.
  • The company proposes to fund new investments through a mix of internal accrual, debt and equity. Venture Capital firms are interested in funding the new projects.
  • The company is doing branding and co-branding for the export houses but is not involved in any direct exports.
  • The company has an understanding with the Prince Charles Foundation and trains the farmers for the organic farming.

The company at Fatehgarh Sahib has a state-of-the-art post harvest infrastructure for fresh vegetables and fruit that includes cold chain, refrigerated vans, and a 100,000 square feet pre-fabricated structure based on clean zone 1,000 technology (an international benchmark to process food to save from contamination), the largest in India.

In this model, the company engaged about 2,500 farmers to cultivate 10,000 acres fro vegetables in Punjab and Parts of Uttaranchhal and Himachal. "We provide quality planting material to the farmers. Due to the strong social fabric in Punjab, the farmers prefer to buy inputs from the shops of their own choice," said Aggarwal.

According to aggarwal, "a farmer who earns about Rs 12,000 Rs 15,000 per acre per annum for wheat and paddy, can earn up to Rs 50,000 per annum by growing thhe fresh vegetables as they are provided with the backward and forward integration under the modular structure."

"With the corporate giants foraying to food retail, the market for service providers is propitious. Our company is already providing back-end support to Reliance, Bharti, Big Bazar, ITC and Heritage Food. The Punjab unit has the capacity to s tore and process 50,000 MT per annum of fruit and vegetables," Added Aggarwal.

The company is doing branding and co-branding for the export houses but is not involved in any direct exports.

The company has an understanding with the Prince Charles Foundation and trains thhe farmers for the organic farming. "There is an enormous market for organic food in the west and we advice our farmers to switch over to organic farming gradually if they want to earn higher returns," Said Aggarwal.

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Package Deal
June 25, 2006

A food company in Punjab ventures into food packaging and community participation

Two year ago when a food company in Punjab conceived an ambitious project for providing extension services and undertaking contract farming, few thought it would succeed. Buy this model was implemented recently and ever since it has been earning accolades for venturing into a larger causes than mere profit making. The cause of empowering women in addition to promoting crop diversification and organic farming.

Punjab Agri Food Parks is now looking for guidance from Prince Charles's Foundation. Prince Charles had visited thhe project site on his recent visit to Punjab.

The women working on the project, many of whhom are widows and almost all are illiterate, have been silently contributing to this success story. But they are oblivious of thhe fact that the plant is expanding its base to become the region's biggest hub making ready-to-consume food products for multinational companies.

"This is a unique model of diversification and social participatin," says Ankush Agarwal, managing director, Punjab Agri Food Parks. According to him, the company is trying ways to offer ready-to-eat food at just Rs 10 per package. Preparing frozen paranthas and samosas for exports are on top of the company's agenda.

And in their plans, they are taking the local community along.

Ventures often fail because industry ignores participation of the community. "We are foolowing a simple but effective model. Our farming extension teams surveyed thhe nearby fields for quality of soil and water. Then we intereacted with farmers and encouraged them to undertake contract farming. We offer them seeds, monitor growth of the crops and tell them not to use chemicals or pesticides. they are on natural farming now and after three years they can switch to one hundred per cent organic farming," says Agrawal.

The success of the venture also lies in the fact that the company has encouraged farmers to break the routine wheat and paddy cycle and take to vegetables as well.

The company also made a conscious attempt to employ women, says Baljit Kaur, an agronomist heading a team of about 100 women. the extension education team has also tried to convince farmers of the merit of savings.

"We tied with the State bank of India to provide them loans up to Rs 1 lakh to meet their seasonal requirements to buy seed and equipment without mortgaging their land," says Arun Sharma, another team leader at the company.

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Prince Charles Visit to Punjab
May 2006

Prince Charles Visit to Punjab Hon. Prince Charles visited Pujab Agri  Venture Limited during his visit to India in  November and had the feel of things..

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