Govt Plans Wider FDI Access In Plantation Sector To Boost Agri Exports

The government is exploring an expansion of foreign direct investment (FDI) opportunities in India’s plantation sector as it seeks to attract global expertise, advanced technology and improved agricultural practices.

According to a report by Financial Express, the move is aimed at strengthening high-value agriculture segments and leveraging free trade agreements (FTAs) to improve productivity and exports.

At present, 100% FDI is permitted in plantation activities covering sectors such as tea, coffee, rubber, cardamom, palm oil and olive oil. The government is now examining the possibility of adding more categories to this list, particularly areas where global trade potential is high.

Focus on horticulture and processed food exports

India’s agricultural exports stood at $53 billion in 2025-26, with the government targeting $100 billion by 2030. Officials said future growth will increasingly come from sectors beyond traditional food commodities, where policy restrictions are often used to manage domestic supply conditions.

Horticulture and processed food products are expected to be key drivers of this expansion. Under the India-New Zealand Free Trade Agreement, which is scheduled to come into effect in October, New Zealand will undertake focused programmes for crops such as kiwi, apples and honey.

The cooperation will include establishing Centres of Excellence, improving planting material, supporting farmer training, conducting research and strengthening orchard management, post-harvest systems, supply chains and food safety practices.

India seeks global expertise in plantation sector

The government is also looking at opportunities in crops such as bananas, where India is the world’s largest producer but has limited export penetration. India’s banana exports were valued at $377.5 million in 2024-25, with a target of increasing exports to $1 billion.

As per the report, officials said improving export protocols, including sea transportation methods for perishable produce, could help India expand its presence in international markets. Ecuador, the Philippines and Colombia currently dominate global banana exports.

Despite allowing 100% FDI in plantation activities, foreign investment has remained limited. Most overseas investment has been directed towards processing and warehousing rather than plantation operations.

Between April 2000 and March 2026, the sector attracted only $239.23 million in FDI, while inflows during 2025-26 stood at $10.84 million.

The government believes greater foreign participation could help bridge technology gaps, improve farm productivity and strengthen India’s position in global agricultural trade.