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3. 
 Contract farming is defined as an agricultural production that is
carried out based on an agreement between buyer and farmer,
with established conditions for production and marketing of
farm products. In simple words, contract farming refers to a
varied formal and informal agreement made between
producers and processors/buyers. It includes loose buying
arrangements, simple purchase agreement and supervised
production with input provision, with tied loans and risk
coverage. In this farming process, a farmer agrees to provide
specific agricultural products that meet the standards
determined by the purchaser. In return, the buyer commits to
purchase and support the production by supplying farm input,
land preparation and the provision of technical advice. This
article discusses in detail about Contract Farming.
Introduction

4. 
 Reducing the load on the central and state level
procurement systems.
 Increasing private sector investment in agriculture.
Bringing the market focus of crop selection by Indian
farmers.
 Generating a steady source of income at the individual
farmer level.
 Promoting processing and value addition.
 Generating gainful employment in rural communities.
 Reducing migration from rural to urban areas.
 Promoting rural self-reliance in general by pooling locally
available resources and expertise to meet new challenges.
Objectives

5. 
 Informal Model: This model is the most temporary and speculative of all contract farming models,
used by both promoters and farmers. However, this is based on the situation, interdependence of
contract parties or long-term trustful relationships that minimises the risk of opportunistic
behaviour. The features of this business model include:
 Small firms conclude simple and informal seasonal production contracts with smallholders.
 The quality and availability of external extension services.
 Embedded services that are restricted to the delivery of necessary inputs and credit advice that is
restricted to grading and control.
 Typical products that require minimal processing, packaging and vertical coordination.
 Intermediary Model: In this model, the buyer subcontracts an intermediary who formally or
informally makes contracts with farmers
Contract Farming Business
Models

6. 
Contract farming is intended to provide benefits for both the farm-producers and the agro-
processing firms.
Producer/Farmer
Enables small scale farming competitive – small farmers can access technology, credit, marketing
channels and information while lowering transaction costs.
Assured market to sell their produce at the doorsteps by reducing marketing and transaction
costs.
Minimises the risk of production, price and marketing costs.
Opens new markets that otherwise is unavailable to small farmers.
Assures higher production of better quality, financial support in cash and technical guidance to
the farmers.
For agri-processing level, it assures a consistent supply of agricultural produce with quality at
the appropriate and lesser cost.
Advantages

7. 
Agro-based Firms
This is the most preferred way to utilise their installed
capacity, infrastructure and human resources and respond to
quality concerns and food safety of the consumers.
Make direct private investment in agricultural activities.
The price fixation is made by negotiating with producers and
firms.
The farmers enter into a contract production with an assured
price, subject to the terms and conditions .

8. 

10. 

11. 

Horticulture is the branch of agriculture concerned with
intensively cultured plants directly used by man for food,
medicinal purposes and aesthetic gratification.
In simpler words, it is cultivation, production and sale of
vegetables, fruits, flowers, herbs, ornamental or exotic
plants.
The term Horticulture is derived from the Latin words
hortus (garden) and cultūra (cultivation).
L.H. Bailey is considered the Father of American
Horticulture and M.H. Marigowda is considered the
Father of Indian Horticulture.
Introduction

12. 
Horticulture sector has become one of the major drivers of growth as it is more
remunerative than the agricultural sector (food grains mainly).
This sector provides employment possibilities across primary, secondary and
tertiary sectors.
Horticulture crops, fruits are more resilient to change in weather conditions
and the vegetables augment the income of small and marginal farmers.
Water utilisation is very low, minimising the risk of crop failure and it can be
done on smaller farms.
Multiple crops are planted simultaneously to get more yield and to use the
maximum of the fertilisers.
This sector enables the population to eat a diverse and balanced diet for a
healthy lifestyle.
It became a key driver for economic development in many of the states in the
country where Division of Horticulture of Indian Council of Agricultural
Research is playing a pivotal role.
Features of Horticulture in
India

13. 
In the last few decades, this sector has gained
prominence over contributing a growing share in Gross
Value Addition of the Agriculture and allied sectors.
Mission for Integrated Development of Horticulture
(MIDH) is being implemented by adopting an end to
end approach for increasing production of horticulture
crops and reducing post-harvest losses.
Achievements

14. 
 Mission for Integrated Development of Horticulture
(MIDH)
Centrally Sponsored Scheme for the holistic growth of the
horticulture sector covering fruits, vegetables and other
areas.
Under MIDH, Government of India contributes 60% of
the total outlay for developmental programmes in all the
states (except North Eastern and Himalayan states where
GOI contributes 90%) & 40% is contributed by State
governments.

15. 

16. 
National Horticulture Mission (NHM)
Horticulture Mission for North East and Himalayan
States (HMNEH)
National Horticulture Board (NHB)
Coconut Development Board (CDB) &
Central Institute of Horticulture (CIH), Nagaland
National Horticulture Board (NHB)
five major schemes on
horticulture-

17. 
 it was set up in 1984 on the basis of
recommendations of the "Group on Perishable
Agricultural Commodities", headed by Dr M. S.
Swami Nathan.
Headquartered at Gurugram.
Objective is to improve integrated development of
Horticulture industry and to help in coordinating,
sustaining the production and processing of fruits
and vegetables.

18. 
 The production of fruits and vegetables has
overcome the production of food grains in the
country.
The total horticulture production has increased
from 211.2 million tonnes in 2007-08 to 311.71 million
tonnes in 2018-19.
India is the second largest producer of fruits and
vegetables in the world with first rank in the
production of Banana, Mango, Lime & Lemon,
Papaya and Okra.