6. Findings of the Need Assessment Mission

During a visit of seco to the INDOCERT project, we came to the conclusion that it is important to improve the organic product market chain in India at various levels. Based on that report, the consultant Christoph Dietler was mandated to analyse the situation and to make a concrete proposal on how seco could support our Indian partners in organic marketing. Together with FiBL and a number of Indian experts, he carried out a need assessment to identify the relevant shortcomings of the sector and to develop suitable strategies to advance the international and domestic market for organic products. The state of the market and the level of quality management of the Indian Organic Agriculture in input, production, processing, trade and consumers were analysed and documented by means of a SWOT- Matrix. As outcome, several strategies and measures were elaborated.

The team came to the conclusion that the young organic market in India benefits from a growing awareness on food quality and pesticides residues among Indian middle-class consumers. But there is a non-negligible risk that this raising awareness is not properly capitalized for the promotion of certified organic products. Since the term “organic” is still not yet fully protected by the Indian law, a future abuse of ecolabelling can be anticipated what may hamper the image of organic products as such. In all organic markets, the credibility of organic products is the crucial factor for success. So it was recommended that potential organic products are initially properly analysed for their Unique Selling Position. Furthermore, an improved quality management was regarded to be a key factor for the success in the Indian organic market. An in-depth knowledge of the principles and standards of organic agriculture by all stakeholders, such as, farmers, processors, traders, exporters, and government agencies is, indeed, also essential for the success of the Indian organic market.
To achieve these goals, a national organization that is in charge of collecting and distributing information and know-how in market issues, quality management, standard setting, etc., was deemed to be highly desirable in the present state of the organic sector in this large country. It was, therefore, recommended that the International Competence Centre for Organic Agriculture (ICCOA) should play a central role in organic market development.

The Indian Ministries of Commerce (MoC) and Agriculture (MoA) are favourable towards organic agriculture (mainly as an export opportunity) and welcome the Indian initiatives to strengthen the internal capacity in market development of OA and the Swiss co-operation with the Indian non-governmental sector in organic agriculture. They support seco’s intention to grant assistance to ICCOA and other institutions involved in the development of organic agriculture.

Another essential finding was that the development of Indian organic agriculture should be focused on the export and domestic market at the same time. Enterprises and organisations among the organic value-added chain must be able to first gain experience on the domestic market to become fit for export. Furthermore it is undesirable that Indian organic farmers uniquely depend on the volatile export market. Farmers, who are able to sell all their crops as organic in different markets, are less vulnerable to fluctuating prices and varying political situations. It has also to be taken into consideration that there is not an international market for all products out of the broad range offered by Indian organic farmers. The domestic market needs support to establish a functional market chain for organic products, i.e. to link producers and the market and consequently increase the market volume.

A main focus should further be put on ensuring the quality of the certification system in order to build up credibility and recognition of organic products in domestic and international markets. It is observed that not all the certifiers work according to the high standards of INDOCERT or IMO Control (India). There are plans of the government to establish one reliable and competent central accreditation agency instead of the presently five agencies, which is considered a necessary step to harmonize the accreditation system.

The government's efforts to establish a national organic label is to be looked into. At first sight it appears that the promotion of the term 'certified organic' would be easier and would probably better serve the needs of the domestic producers for the time being.