Montek moots contract farming tie-up in Oman.

Oman could strengthen domestic availability of food grains by entering into "contract farming" with the Indian farmers, planning commission deputy chairman Montek Singh Ahluwalia has said.

He said that agriculture was an important area for the Omani government to invest. "The Indian law does not allow foreign companies to buy land there and therefore, Omani companies can enter into a contract farming relationship for producing the type of crop they want," Ahluwalia told Times of Oman during his recent visit to the country.

"We have identified from our side a couple of companies that have indicated that they would be interested in tying up with Omani investors to get into contract farming arrangement," he said, adding that (Omani) companies can even specify the manner in which they want to produce the crop.

According to the Omani government data, bilateral trade between Oman and India is expected to reach $2.5 bn this year, up from $2 bn in 2009. Ahluwalia was in Muscat to sign an agreement to approve a report on nine areas of co-operation for direct investment between the two countries.

"We feel that there is scope for bringing Omani investment into (India) for producing rice through contract farming system," he was quoted as saying by the newspaper.

Oman was also one of the first countries to form a joint investment fund with India, which is set to rise from $100m to $1.5bn.

Ahluwalia also noted that Oman India Fertiliser Company (Omifco), a joint venture equally owned by Oman and India, can be a vehicle of investment in fertiliser sector in a third country.

The newspaper also quoted that the two officials (one each from both countries) have been working to boost cooperation between the two countries since 2008. Areas for collaboration include education, information technology, vocational training, food processing and hospitality.

Source : fnbnews.com