Why the food supply chain in India is troublesome?

 

Food supply Chain

India, a nation known for its wide-ranging agricultural landscape and varied culinary customs, is experiencing several issues with its food supply chain that have combined to create a crisis. India's food scene is a brilliant tapestry, from the savory curries that waft through the busy marketplace to the vibrant colors of fresh fruit in mandis. From farm to fork, this complex network of interrelated operations deals with structural problems that simultaneously affect farmers, distributors, retailers, and customers. In this Blog, we explore the causes of the current unrest in the Indian food supply chain and the government of India's policies to make improvements.

Agricultural System Fragmentation: The disintegration of India's agricultural system is one of the main issues. Most farmers have small landholdings, which leads to limited economies of scale. This makes it challenging for farmers to invest in technology, use modern farming methods, and effectively manage their crops. The absence of consolidation lowers overall productivity and impedes resource optimization.

Deficiencies in the infrastructure: Inadequate infrastructure, including antiquated storage facilities and ineffective transportation networks, impedes the Indian food supply chain. Because perishable items deteriorate under improper storage conditions, post-harvest losses are substantial. Furthermore, there are delays and inefficiencies in the transportation network due to its outdated technology, which negatively affects the availability and quality of food goods on the market. In India, the food and agriculture industries employ the greatest number of people. India wastes between 5 and 15% of its produce each year because it lacks cold chain infrastructure and efficient harvesting techniques.

Insufficient Cold Chain Facilities: In India, cold chain facilities are severely lacking, which is essential for maintaining the freshness of perishable goods. Fruits, vegetables, and dairy products are significantly wasted when there is no effective cold chain. In addition to hurting farmers' livelihoods, this also increases food prices and scarcity.

Inadequate Market Linkages: India's farmers frequently struggle to establish direct connections with markets. Although middlemen are important to the supply chain, their existence can result in unfair pricing and farmer exploitation. The lack of strong market connections hinders farmers from receiving a fair price for their produce and makes the problems facing the whole supply chain worse.

Paralysis within Policy:

India's regulatory framework has come under fire for being convoluted and inconsistent. The market is unclear due to frequent changes in trade, agriculture, and food processing policies. This uncertainty stifles the growth of a robust and contemporary supply chain and deters investment in the industry.

Impact of Climate Change:

India's agriculture is seriously threatened by climate change. Crop failures can be caused by erratic weather patterns, catastrophic occurrences like floods and droughts, and a lack of sustainable farming methods. The difficulties facing the food supply chain are further complicated by the agricultural sector's susceptibility to climate change.

Absence of Technology Adoption: In the Indian food supply chain, technology adoption has been sluggish. To improve efficiency and transparency, a thorough integration of technology is required, ranging from supply chain analytics to farm management systems. The industry's capacity to overcome innate obstacles is hampered by a reluctance to adopt technical innovations.

The Indian government has put in place some policies to address the issues it has identified with the food supply chain.

Modernization of Infrastructure:

Pradhan Mantri Kisan SAMPADA Yojana (PMKSY): Seek to build agro-processing clusters, establish food processing and preservation capabilities, and build integrated cold chain and value addition infrastructure.

Kisan Vikas Kendras (KVKs): These facilities give farmers access to better seeds and fertilizers, training programs, demonstration farms, and technological know-how and resources.

Dedicated Freight Corridors: Programs such as these are designed to increase the effectiveness and infrastructure of the rail system to move agricultural products more quickly.

Reforms in the Market and Openness:

e-NAM: The National Agricultural Market, or e-NAM, is an online marketplace that links farmers and buyers directly, increasing pricing transparency and cutting out intermediaries.

Operation Greens: The goal of Operation Greens is to enhance market research and infrastructure for perishable goods such as onions, potatoes, and tomatoes.

Gate Procurement: The goal of farm gate procurement is to directly purchase agricultural products from farmers at minimum support prices while guaranteeing equitable returns.

Technology Adoption:

The Digital Kisan Portal gives farmers access to data on market pricing, government programs, and weather forecasts.

Soil Health Cards: Give farmers information on nutrients in the soil so they can maximize fertilization and implement precision agriculture techniques.

Krishi Vigyan Kendras (KVKs): Help spread knowledge about climate-smart agriculture and encourage the use of cutting-edge gadgets like sensors and drones.

Additional Programs:

PM Formalization of Micro Food Processing Enterprises (PMFME): Promotes value addition and lowers post-harvest losses by offering small food processing units financial and technical support.

Production-Linked Incentive (PLI): This Scheme is designed to encourage investments in the food processing industry by offering financial rewards. Its objective is to increase both local production and exports.

Overall, the food supply chain in India is facing numerous obstacles that require immediate attention and systemic changes, placing it in a precarious position. Building a robust and sustainable food supply chain requires addressing the problems of fragmented agriculture, poor infrastructure, market connections, and policy coherence. Achieving food security, equitable returns for farmers, and a strong supply chain for the future requires embracing modern technologies, making infrastructural investments, and establishing supportive regulatory environments. The government, commercial sector, and civil society must work together to guide the Indian food supply chain in the direction of stability and prosperity.