In India, flower gardening is emerging as an of import commercial harvest. A batch of importance has been given to this sector due to its multiple utilizations, fulfilling the aesthetic demands of the people, making more employment, guaranting higher rate of returns to rural people and easing gaining more foreign exchange. More specifically, they are being used as natural stuffs in the industry of kernel, aromas, medical specialties and confectioneries for direct ingestion by the society.
The production of flowers is an antique business. Until last decennary, the turning and merchandising of flowers was confined to a few households. They grew a assortment of flowers on the same land which were sold near to the house, as they could non last a long journey. The state of affairs in the last decennary has nevertheless, changed. Now, different husbandmans are turning different flowers both for domestic market and export intents. The flowers were, until 1960s, confined to domestic markets. These flowers are now traveling long distances due to the handiness of airfreight and high-tech chilling systems.
The economic reforms and liberalization policies introduced from 1991 and modified EXIM policies of 1995-96 and 1999-2002 hold given bonuss to floriculture sector. After liberalisation, the Government of India identified flower gardening industry as a dawn industry and accorded it 100 per cent export-oriented position. Later, many author shave termed this industry as “ Rosy Business sector ” , “ a Global Concern ” , “ Blooming Industry ” , “ Thrust Area ” , “ Money Spining ” , “ Lucrative export-oriented sector ” etc.
Definition of Flower gardening Industry
The flower gardening industry involves the cultivation and distribution of bulbs, cut flowers, leaf and workss to both local and international markets. Harmonizing to the Harmonized Code System, floricultural merchandises are classified under the codification 06 ( unrecorded trees and other workss ) . In this context, it appropriate to understand the international and national scenario of the flower gardening industry.
The International Floriculture Industry
The Netherlands is the Centre around which the international flower gardening trade revolves. It is the largest exporter of floricultural merchandises. Due to the high concentrations of supply and demand in the Netherlands, the monetary values of floricultural merchandises are set here ( CBI, 2003a ) .
The two market studies of the Centre for the Promotion of Imports from Developing Countries ‘ – 1 on cut flowers and leaf ( 2003a ) and the other on workss and immature works stuff ( 2003b ) – provide the most comprehensive information of the international flower gardening.
The planetary flower gardening industry has many active participants in all of the continents. The figure of participants, in both developed and developing states is increasing continuously. World exports and imports of floricultural merchandises both exceed US $ 9 billion, where Europe is both the largest importer and exporter of floricultural merchandises ( Pathfast Publishing, 2004 ; Van Liemt 1999: 7 ; ITC Calculations based on COMTRADE statistics ) .
International trade in this industry is complex, as there are many factors that influence exports ( CBI, 2003a ) . These factors include the demands of different types of markets ( The Kaiser Study, 2000: 20 ) 138, demands ( e.g. quality criterions ) set by authoritiess and international purchasers ( CBI, 2003a & A ; 2003b ) , shorter life rhythms of the taking assortments of floricultural merchandises ( Thoen, Jaffee, Dolan & A ; Ba, 2000 ) , alterations in consumer demands ( Flower Council of Holland, 2004 ) and tendencies in manner and ingestion ( CBI, 2003a ; Flower Council of Holland, 2004 ) .
In kernel, the international flower gardening industry can be described as an industry that is continuously altering. Therefore it is necessary that the exporters be successfully integrated into the planetary flower gardening market, as it determines the grade of their fight.
In a nut shell, the Indian flower gardening industry has the ability to increase its export engagement, which will heighten foreign exchange net incomes.
Current position of Indian flower gardening industry
The cultivation and export of floricultural merchandises have received considerable involvement in recent old ages from the policy shapers, research workers, agricultural and horticultural contrivers due to the sector ‘s possible in employment, income and export coevals. On this land, flower gardening has been provided extra push in recent old ages. The program spendings have been stepped up in consecutive programs for development of flower gardening.
Government of India has identified flower gardening as a dawn industry and accorded it 100 % export oriented position. Owing to steady addition in demand of flower flower gardening has become one of the of import Commercial trades in Agriculture. Hence commercial flower gardening has emerged as high-tech activity as production is taking topographic point under controlled climatic conditions inside nursery. Flower gardening in India is being viewed as a high growing Industry. Commercial flower gardening is going of import from the export angle. The liberalisation of industrial and trade policies paved the manner for development of export-oriented production of cut flowers. The new seed policy had already made it executable to import seting stuff of international assortments. It has been found that commercial flower gardening has higher possible per unit country than most of the field harvests and is hence a moneymaking concern. Indian flower gardening industry has been switching from traditional flowers to cut flowers for export intents. The liberalized economic system has given an drift to the Indian enterpriser for set uping export oriented floriculture units under controlled climatic conditions.
The Five-Year Plans which had non given due attending to this harvest in the yesteryear have started giving more attending to it on history of its multiple usage. In the Ninth Five Year Plan, approximately 40 crores were allocated to this sector ( GOI 1996: 55 ) as against 17 crores in the Eighth Five Year Plan ( GOI 1996:49 ) . This speaks of the importance given to the sector. This positive attitude enabled the state to accomplish a discovery both in country enlargement and production in the last 8 to 10 old ages.
Further, after achieving autonomy in nutrient grain production, the policy focal point is being directed more towards compensable harvests and export possible harvests. In this occasion, this sub-sector has been encouraged, because of its demand both in domestic every bit good as international markets. The additions in per capita income and urbanization have led to a greater penchant and increased demand for flowers. At present, flowers are being extensively used in assorted topographic points. The testimony of this is mushroom growing of florist centres in urban countries, its prosperity and demand.
However, some provinces are still dawdling behind in this procedure. This may be due to miss of infrastructural installations, deficiency of counsel to husbandmans by the section of flower gardening every bit good as unsuitable agro-climatic conditions. Still, this sector has a few constrictions. These have to be tackled and accordingly the activity should go more compensable to the husbandmans with appropriate market oriented extension attacks. In this occasion, it is of import to understand the portion of flower gardening in the Indian agribusiness exports and national exports.
India ‘s Exports of Agricultural and Floriculture Products vs. National Exports in values
The tabular array no.1 gives the India ‘s Exports of Agricultural and Floriculture Products vs. National Exports in values ( Rs. Crore ) . Subsequently the graph no. 1 and 2 will give the tendency lines of agribusiness and flower gardening export values tendency. The values of the tabular array no.1 indicates clearly that the neither the agribusiness nor the flower gardening exports are non turning at the stage of India ‘s entire export growing.
The value of Indian flower gardening export in the local currency and the per centum portion of it to the entire Indian agribusiness export in value footings indicates that the value of Indian flower gardening export was increased from INR.127.43 crore in 2001-02 to INR. 368.81 crore in 2008-09 period that is, there was a treble addition in export net incomes. Even, in the twelvemonth 2006-07, the export value was in extremum. There was a quintuple addition in export value in 2006-07 compared to 2001-02. The per centum portion of Indian flower gardening export to entire Indian agribusiness export besides was bit by bit increasing from 2001 to 2007 and started worsening from 2007 onwards.
In fact, after the twelvemonth 2006-07 period the per centum portion of flower gardening every bit good as agribusiness export value is worsening aggressively. This indicates that these sectors have to be studied in item in order to re-instate the growing the sector. The export gross of the flower gardening and agribusiness may be low comparing to the entire net incomes. But these sectors are the support for most of the Indians.
The growing driver ‘s of flower gardening sector
Turning demand and much higher return per unit of land than any other agricultural activity has prodded husbandmans to take this sector. The turning demand for this merchandise has besides increased on history of rapid urbanisation, addition in single buying power among middle-income groups, addition in the figure of IT Units, Hotels, Tourists, Temples, addition in GDP, Per capita Incomes, alteration in life styles and societal values of the people, greater consciousness among the people to better the deteriorating environment and economic up-liftment of the people ‘s conditions.
Table No. 1 India ‘s Exports of Agricultural and Floriculture Products vs. National Exports in values ( Rs. Crore )
2003 – 04
2004 – 2005
2005 – 2006
Flower gardening Merchandises Exports
Entire Agricultural Exports
Entire National Exports
% Share of Agricultural Exports in National Exports
% Share of Floriculture Exports in Agricultural Exports
% Share of Floriculture Exports in National Exports
2006 – 07
2007 – 08
2008 – 09
2009 – 10 ( P )
Flower gardening Merchandises Exports
Entire Agricultural Exports
Entire National Exports
% Share of Agricultural Exports in National Exports
% Share of Floriculture Exports in Agricultural Exports
% Share of Floriculture Exports in National Exports
Beginning: – Director General of Commercial Intelligence & A ; Statisticss, Ministry of Commerce, Kolkata.
Graph no.1 India ‘s Exports of Agricultural and Floriculture Products and Total National Exports in values
Graph no.2 India ‘s % Share of Exports of Agricultural and Floriculture Products in National Exports in values
Scope of the article
This article attempts to clarify the modern-day alterations in the flower gardening sector in the last two decennaries, particularly, after the liberalization, globalisation and execution of trade reforms which has brought structural alterations in the flower gardening sector. That is most of the flower gardening merchandises are produced for export intent. So, first purpose of the article is to gauge the effects of the trade reform measures in footings of trade snap of ordinances and fight of Indian flower gardening exports. In malice of the generalised recognition of turning liberalization of trade between states, there are still legion obstructions to merchandise, more of the nontariff type. It aims to lend the literature on quantifying the economic impact of Indian trade reforms related to flower gardening industry. The changeless market portion ( CMS ) theoretical account has been used to obtain insight into the overall kineticss of the export markets, trade flows and fight of Indian flower gardening exports. Based on the consequences, the suited international market oriented extension approached can be suggested for the flower gardening sector.
Aims of the survey
To mensurate the overall export public presentation of Indian flower gardening industry with major importing states
To measure the consequence of fight and market entree on Indian flower gardening export in major importing states.
To offer market orientated extension schemes for flower gardening sector
Beginnings of informations
Data on international trade are sourced from the trade good trade informations base ( COMTRADE ) of the United Nations Statistics Division. The informations used are for the period 1991 to 2009 ( 10 old ages ) . As CMS analysis covers a long period, particularly, base and current old ages, the composing of the states varies. The choice of the states in the analysis is besides based on the value of the trade ( with respect to relevant old ages in the analysis ) with India. The trade goods covered are the flower gardening merchandises under the HS Code 06.
India ‘s export public presentation of flower gardening merchandises
The tabular array no.2 reveals the India ‘s entire export value of flower gardening merchandises from 1991 to 2009. India has performed moderately good in the export of flower gardening merchandises since 1990 compared to pre trade reform period. There was a steady growing in the flower gardening exports from India boulder clay 2007. Subsequently, it dropped by 44 per centum in value footings. After the subprime crisis in the twelvemonth 2008, the Indian flower gardening trade had witnessed a negative growing. The twelvemonth to twelvemonth growing rate of the flower gardening was besides extremely instable and fluctuating in the last two decennaries. It necessitates analysing India ‘s export public presentation of flower gardening merchandises and understanding the cardinal factor for the growing in flower gardening exports. In bend, that cardinal factor has to be strengthened by the manner of extension services for the flower gardening sector. For placing the cardinal factor Changeless Market Share analysis is used.
Table No. 2 India ‘s Entire export value of flower gardening merchandises and growing rate
Beginning: UN Comtrade statistics ( Annual )
Graph 3 India ‘s Entire export value of flower gardening merchandises
Graph 4 India ‘s export growing rate of flower gardening merchandises
CMS Model specification
The undermentioned analysis throws light on India ‘s export public presentation in the major flower gardening importing states, Netherlands, USA, France, Germany and Japan. The method of CMS analysis, modified for as individual trade good instance, is an ideal complement to the gravitation analysis. It should be emphasized that the CMS analysis is simply a measuring techniques for break uping the growing of variable and should non be viewed as a behavioural relationship. This theoretical account decomposes the beginning of export public presentation and distinguishes between alterations in market incursion ( market portion ) and alterations in the size of these markets ( market size ) . ( x1-x0 ) in equation refers to the growing in exports I ( single finish states ) , which is decomposed into three constituents of export public presentation on the right manus side of the equation. The method is applied to single markets, so that the state composing consequence term is dropped, bring forthing the undermentioned decomposition of export growing:
x1-x0= S0 ( X1-X0 ) +a?‘i ( Si0-S0 ) *Xi1+ ( X1-a?‘iSi0Xi1 )
x= value of India ‘s exports of flower gardening to major export markets.
S= India ‘s market portion of the entire export of flower gardening to major export markets
Si= India ‘s market portion of entire exports of flower gardening to member states i in major export markets
X= entire exports of flower gardening to major export markets
Xi= value of entire exports to the member states i in major export markets ; the inferiors 0 and 1 refer to the base period and current period severally.
Size of the market consequence refers to the alteration in measure of entire exports to i over the period, ( X1-X0 ) . If this increases/ declines, so even with a changeless market portion ( S0 ) , so exports will increase / diminution by S0 ( X1-X0 ) . The size of market consequence consequences from a displacement in the demand in major export markets. Market composing consequence refers to the alterations in the export portions in single member states i compared to its overall portion in the group, in the base period ( Si0-S0 ) . Competitiveness consequence measures the difference between existent exports in the subsequent period, x1 and the degree of exports that would hold occurred has the same base period market portion in each state ( X1-a?‘iSi0Xi1 ) been maintained. It indicates the extent to which a state is able to derive international market portions in malice of inauspicious universe demand motions. It is frequently interpreted as an indicant of the dynamic ability of a state to react to altering environment and accommodate its supply state of affairss consequently. Therefore, it decomposes the export growing into the size of the market and market composing effects thereby insulating fight consequence ( X1-a?‘iSi0Xi1 ) which is a residuary term in the equation.
The implicit in premise of the CMS attack is that base period export portions are maintained other market periods. The three structural constituents of the market portion are calculated under this premise. The entire growing consequence ( X1-X0 ) is equal to what the states growing in export would hold been if it had merely maintained its portion of entire universe exports. The market composing consequence histories for any extra growing ( positive or negative ) which takes topographic point because the focal point state ‘s exports have grown in gait with the entire growing in exports of the trade good to the importing part as a whole. These three effects all hypothesize changeless export portions. The residuary consequence ( X1-a?‘iSi0Xi1 ) , which proves the individuality, histories for all the growing which raises from alterations in export portions.
Consequence and Interpretation:
The changeless market portion analysis is performed for the exports ( value in USD ) of flower gardening merchandises to the major 20 export markets in the universe for the period 1991-2009. The analysis covered the whole period as one-year arithmetic norms for the three back-to-back old ages. For illustration, 1991-2009, implies that it has covered the period 1991, 1992 and 1993 for the base period and 2007, 2008 and 2009, for the current period. The consequences are summarized in the tabular array no. 5.
Table No. 5 Changeless market portion analysis of Indian Floriculture Export from 1991 to 2009 ( in per centums )
market composing consequence
United Arab Emirates
Rep. of Korea
The decomposition of the overall export growing of flower gardening merchandises in footings of market size, market composing and fight consequence utilizing CMS indicates that the fight of the Indian flower gardening industry is the cardinal constituent for the export growing, Internet Explorer. 80 % . It reveals the strong supply side of Indian flower gardening industry. However, the fight factor can non be attributed to a individual factor.
It besides indicates that the international demand for the flower gardening merchandises, in other words, the growing of the market size has minimum impact in the Indian export growing in the survey period 1991 to 2009, Internet Explorer. 8 % . It indicates that the international market growing gait is faster than the Indian export growing gait. It may be due to the structural frailties or international trade barriers to Indian export or locational disadvantage to the international flower gardening market.
The market composing consequence, which is 12 % , indicates that India is losing the international market growing of flower gardening merchandises to exporters of viing states. At best, these figures are the modest indexs of the different forces that are in action at the international markets for Indian flower gardening industry.
The CMS analysis consequence for the top 20 states besides reveals similar scenario except few markets like United Kingdom, Ireland and United Arab emirates where the market effects are strong for the export growing of flower gardening merchandises.
Learning ‘s for the extension services
The CMS analysis consequence indicates that India has strong supply side fight. Hence, Indian extension schemes as to concentrate more on beef uping the Quality parametric quantities, Environmental issues, Product variegation, merchandise distinction and supply concatenation substructure. These are briefly discussed below.
Quality parametric quantities and Environmental issues
In the recent old ages, the increasing demands for quality and sustainability by planetary purchasers, and the increasing purchasing power of retail merchants in the developed state markets have been presenting several challenges on producers/exporters in the development states, peculiarly with regard to increasing safety, environmental concerns, and labour criterions. Some of the ordinances and criterions applied in the flower gardening trade include: MPS, GLOBAL-GAP, ICC, and FLP, which have become compulsory for providers in the direct gross revenues channel and prominent in the auctions.
Product Diversification and Differentiation
One of the major grounds for the planetary purchasers in the flower gardening industry to diversify their sourcing schemes is the increasing usage of merchandise distinction schemes in the international market. The retail merchants derive competitory advantages from selling alone nonAstandard merchandises that are non by and large available in the market, viing non merely on monetary value, but besides on factors such as dependability, merchandise assortment, merchandise quality and velocity of invention. This has become a major challenge for Indian flower exporters, in diversifying and cut downing dependance on bring forthing individual assortments, which in many instances is limited to merely Roses. Even African exporters are invariably in hunt of new flower gardening harvests and researching the production of new assortments.
Supply concatenation substructure
Clean handling and better storage environment is really of import in floriculture supply concatenation. Cut flowers must be cooled to temperature runing between 33o F to 41o F without much hold. A higher temperature is non merely cut downing the vase-life but besides increases the respiration rate, heat production, and later increase the amendss caused by ethylene formation. Additionally, high temperature besides generates high humidity/ wet, which causes development of fungal and bacterial infections in the roots and flowers doing impairment of the merchandise quality. Therefore, temperature and humidness controlled transit is needed at all phases of the transit procedure to guarantee that the flowers do non deteriorate in their quality. Owing to this, the station crop losingss are high. Though no systematic survey has been conducted to measure these losingss, the estimated losingss range even up to 40 per centum, depending upon assorted phases of post-harvest handling.
Harmonizing to the industry beginnings, in India, the handiness of dedicated cold storage installations at farmyards as besides at airdromes is minimum. In add-on, the adequateness degrees of chilling installations in domestic transit demand to be examined in the context of the turning international flower concern.
Presently, merely six international airdromes have cold storage installations for perishable lading and are faced with the challenge of under use of the facilities.. Under such fortunes several hours ( sometimes even yearss ) would sink before the lading could be loaded to the linking flight. Furthermore, Because of little volume of flowers, they largely have to be transported on regular flights holding limited cargo infinite.
The imposts clearance processs continue to be clip consuming and are still presenting a challenge to the exporters.
Though India has strong supply side fight, But, India is unable to capitalise the international market growing. It may be due to the structural frailties in international floricultural trade which has to be farther investigated in item.