Chairman’s Message

CMA (Dr.) K Ch A V S N Murthy
Chairman
Task Force on Agri Cost Management
The Institute of Cost Accountants of India

Dear Friends,

Indian economy is intertwined with agriculture because of the fact that agriculture is highly significant not just to meet the food and nutritional needs of the nation but also for creating critical rural demand for the manufacturing and services sectors. Therefore, several economists consider agriculture as the primary driver for the economy with a multiplier impact of agri income on GDP ranging from five to ten percent. However, in spite of several policy initiatives, farmers’ income continued to remain low leading to huge disparity between farm workers and non-farm workers. One estimate puts the farm workers earnings just as low as 25% of the earnings of the workers from other sectors.

With the markets becoming global & competitive and the resources being scarce; emphasis and use of Cost Management Techniques throughout the value chain has been integral to the overall entrepreneurial growth and prosperity. But, the application and use of these techniques, as of now, appears limited within the domain of agriculture, in particular when farmers are to be viewed as ‘agripreneurs’ and agriculture as a ‘for-profit’ economic activity. As such, ‘Agri Cost Management’ along with techniques and approaches from Management Accounting can be of immense benefit to agriculture and agri-enterprises in striding towards ‘Augmentation of Farmers’ Income’.

In relation to Augmentation of Farmers’ Income, the visualized contribution from the Institute of Cost Accountants of India may broadly encompass the following avenues:

  • Pricing
  • Revenue Management & Cost Control
  • Agricultural Value Chain Management
  • FPO Management
  • Financial Services
  • Agricultural Supply Chain Development
  • Inventory Management
  • Capacity Building
  • Cost Benefit Analysis
  • Value Added Studies
  • Transition from Agri 4.0 to Agri 5.0
  • Mechanization
  • Sustainability
  • Several Other Related Avenues

The Institute of Cost Accountants of India (ICAI) at the Institution level and through the CMA fraternity has associated with the ambitious objective of augmenting farmers’ income and initiated the process of formulation of “Strategic Agricultural Cost and Returns Management”. Towards this, the ICAI had constituted ‘The Agri Task Force’ to formulate the approaches for the engagement of CMAs individually and through ICAI.

The Task Force has been mandated to focus on:

  • Policy planning and interventions by undertaking research & studies and associate with Governments at State and Central levels.
  • Integrating Agricultural Cost and Management Accounting into the institute’s curriculum and other professional development programmes.
  • Networking with institutions in public and private sectors engaged in research, academics, extension and commerce/business.
  • Enhancing awareness on cost and returns optimisation as well as minimising risks throughout the agricultural value chains;
  • Agricultural credit and ways to enhance the benefits of credit to both the borrowers and lenders.
  • Such other matters as may be relevant towards the set objective.

For the year 2021-22, the Task Force has carved out a four-pronged theme driver for ‘Educating, Empowering, Enhancing and Enriching’ the famers in coordination with IGNOU, NABARD, NIRD and CACP. The task force is moving forward with a diligent action plan towards achieving the scripted targets.

CMA (Dr.) K Ch A V S N Murthy