Economics of agro-processing industries in Jammu & Kashmir

The Union Territory of Jammu and Kashmir, has already created a niche for its horticultural products. The diversity in agro-climatic conditions naturally provides ground for the cultivation of horticultural and other high-valued food and non-food products. However, poor infrastructural capacity, inadequate investment and poor marketing linkage pull down the growth of these high-valued crops. The real potential of these high-valued crops is still un-exploited and under-utilized. This paper maps agro-processing units in the state and assesses their efficiency, inclusiveness and prospects for future growth. Cobb-Douglas method is used to estimate the marginal productivity of labour and capital whereas other statistical methods are used to quantify the related data from the agro-processing industries. The findings show that the agro-processing sector is dominated by smallscale industries and is labour-intensive, and lacks capital investment and market linkages. The need is to bring investment, upskill the labour-force as well as improve the marketing infrastructure in the region to provide the required incentives to push the sector to achieve its full potential.