Merger of commodity boards

• The commerce ministry is planning the merger of commodity boards and set up an umbrella organisation in order to improve production and exports of plantation crops like tea, coffee and spices.

Functions and objectives of Commodity Boards

• Advising the government on policy matters such as fixing quotas for exports, entering into trade agreements with foreign countries, etc.
• Undertaking promotional activities such as participation in exhibition and trade fairs, opening of foreign offices abroad, conducting marketing surveys, sponsoring trade delegations, etc.
• Promoting the consumption of commodities in their jurisdiction by opening branch offices in foreign countries.
• Resolving all problems relating to commodities in their jurisdiction.
• Undertaking research activities to develop production and marketing activities within the country. Commodity Boards have research units of their own. Examples include Central Coffee Research Institute, Rubber Research Institute, Coir Research Institute at Allepply, the Central Sericulture Research Station at Berhampur, etc.
• Imparting training to workers engaged in the production of the commodity concerned. The National Coir Training and Design Centre, Institutes of Handloom Technology at Salem and at Varanasi are the training institutes set up by their respective commodity Boards.
• The five commodity boards, under the ministry of commerce, are responsible for production, development and export of tea, coffee, rubber, spices and tobacco.

Analysis:

• Merger of these boards could help in harmonising their activities and in turn, enhance the quality and boost exports. Besides, one board will provide better services. 
• The Coffee Board is a statutory organisation constituted under the Coffee Act, 1942. Similarly, the Rubber Board was constituted under the Rubber Act, 1947.
• Tea Board was set up on 1st April, 1954 under the Tea Act, 1953.
• The Tobacco Board was constituted in January, 1976, while the Spices Board was formed in February, 1987.
• These crops play an important role in the economic growth as they contribute in the country’s exports and also create huge employment for people.
• But dip in global demand and prices have impacted shipments of some of these commodities.
• In December 2016, exports of tea and tobacco recorded positive growth, while shipments of coffee and spices grew by 15% and about 3%, respectively.
• Agri-products account for over 10% of the country’s total exports.
• In order to boost agri-exports, the commerce ministry has asked exporters to explore new markets and ship value-added products.
• As a step to revive the plantation sector, the government introduced pan-India e-auction of tea for better price realisation and to bring in more transparency in auctions.
• This  rejig is being made at the commodity boards to bring in more efficiency in the plantation sector, which employs a big workforce.
• The direct and indirect employment in the plantation sector is -- 1.128 million in tea, 1.2 million in coffee and 650,000 in rubber.

By: Vishal