ITC Plans To Invest Rs 1,000 Crore In Agri Business In Seven Years

Posted: Friday, Apr 04, 2003 at 0000 hrs IST
Updated: Friday, Apr 04, 2003 at 0000 hrs IST

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Mumbai, April 3: : Diversified business conglomerate ITC Ltd plans to invest around Rs 1,000 crore over the next six to seven years to grow its agri business and enhance the competitiveness of Indian agriculture at the same time.

Addressing media here on Thursday, ITC chairman YC Deveshwar said, “We have already invested Rs 57 crore for setting up around 1,900 e-choupals, which function as intermediaries for food and agricultural products supply.” ITC has connected around 11,000 villages across 14 sates electronically, reaching out to 12 lakh farmers. The company plans to set up six e-choupals per day and expects to recover the costs on each choupal within two to three years.

As part of its ongoing rural initiatives, the company plans to foray into the insurance and micro-credit businesses. Mr Deveshwar added, “Most of the major insurance companies have approached us but we plan to go on our own. We are also looking at providing micro-credit to farmers.”

ITC has initiated talks with several banks to provide credit to farmers and has also applied to Irda for the license in insurance business. The insurance venture will be through a separate company and plans to provide with both life and non-life insurance products. The company’s ‘e-choupal’ initiative is enabling Indian agriculture significantly and enhances its international competitiveness. This strategy of e-enabling the farming community will create a huge network of rural distribution adding substantially to ITC’s marketing muscle.

As regards to its foods business, Mr Deveshwar said, “We want to become a Rs 5,000 crore company in the FMCG business excluding the cigarette business in the next five to seven years time. We will be entering into new variants and categories every second months.” As regards hospitality industry, he said, “We have established our presence at major business locations. We have been the single largest investor in this sector investing around Rs 1,500 crore in the last six years. However, we have decided not to invest further in this sector due to turmoil in the sector for the lasr couple of years. If the situation improves, we will definitely go ahead. We have two properties in Chennai and Bangalore.”

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