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The Food Supply Chain In India Untapped Comparative Advantage

The Food Supply Chain In India Untapped Comparative Advantage. N. Viswanadham Indian Institute of Science October 5,2013 Workshop at IIT Kharagpur on Sustainable Food Security through Technological Interventions for Production, Processing and Logistics . A Revolution in the Making.

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The Food Supply Chain In India Untapped Comparative Advantage

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  1. The Food Supply Chain In IndiaUntapped Comparative Advantage N. Viswanadham Indian Institute of Science October 5,2013 Workshop at IIT Kharagpur on Sustainable Food Security through Technological Interventions for Production, Processing and Logistics 

  2. A Revolution in the Making • Break through Innovations are possible with booming employment opportunities. • What is needed is out of the box thinking in terms of product offerings made to various customer segments with appropriate business models with Affordability, Availability and Awareness in mind . N.Viswanadham

  3. The India Advantage • In India, 52% of land is cultivable & World average is 11% • All 15 major climates of the World are in India • Snow bound Himalayas to hot humid southern peninsula, • Thar desert to heavy rain areas • Has 20 agro-climatic regions & 46 out of 60 in soil types • Sunshine hours and day length ideally suited for year round crop cultivation. • Mega centre for biodiversity in plants, animals, insects, microorganism and accounts for 17% animal, 12% plants and 10% fish genetic resources of the globe. • Live stock sector: India has 16% of cattle, 57% of buffalos, 17% of goats and 5 % of sheep population of the world.

  4. The Plough-Plate Food Supply Chain • The supply chain involves farmers, seed producers, fertilizer factories, financial institutions, millers, government, warehouses, fair price shops, retail shops, railways, truck transport companies, etc. • The relationship among the actors is adhoc and not planned leading to inefficiencies

  5. Institutions Packaging Duties High Protectionist Trade Tariffs Economic Policies Logistics Resources No Cold Chain Abundant FOOD SUPPLY CHAIN Delivery Services and mechanisms Resources & Management Information Technology Resources Management Inefficient and Fragmented Planning No Supply Chain Visibility Product Offering Supply Chain Few Processed Products/Labs Too many intermediaries Supply chains Benchmarking Food Chain

  6. State of Indian Food Sector Strengths 1.Vast natural resources (cultivable land, water, seasons) 2.Established farming system 3.Growing economy 4.Supporting government policies (FDI, APEDA, subsidies) 5. Vital outsourcing hub Weaknesses 1.Small scale conventional farming 2.Primitive post-harvest methods 3.No channel master & many farmers to consumers intermediaries 4. Hardly any Food processing industry 5. Inadequate storage & transport (logistic )infrastructure Potential to become a leading food supplier for the whole world Consequences 1.Surplus food wasted away 2.Low incomes to farmers 3.Inefficient supply chain 4.Not meeting the young consumer preferences (processed hygienic food) Opportunities 1.Cold chain infrastructure builders 2.Processed food manufacturers 3.Food packaging & logistics providers 4.Food retailers and Exporters 5.IT and data analysts 6.Research Institutions N.Viswanadham

  7. APMC, Min price, Essential Commodities, PDS,VAT Quality Control & Environmental Issues Social (Kirana shops), Financial & Trade issues INSTITUTIONS Sensor networks & supply chain visibility Infrastructure: Canals, Roads, Research: University, Seeds, Testing, Dev, Labs FOOD SUPPLY CHAIN ECOSYSTEM Cold Chain Logistics Sourcing Hubs, Food Courts, Clusters DELIVERY SERVICE INFRASTRUCTURE RESOURCES Food Parks, APEDA, Freight Corridors HR management Dealing with Kirana shops, Financials Water, Power , seeds FOOD SUPPLY CHAINS Retail Chains Mandis, Restaurants Distribution Packaging Food Manufacturing Suppliers Farmers, Fisheries, Meat, Dairy

  8. WATER TAX OCTROI SALES TAX SERVICE TAX PRESENT CONDITION OF TRADERS Fringe Benefit Tax VAT INEFFICIENT LABOURS • LICENCES & PERMITS • INDUSTRIAL DISPUTE ACT • SHOP & ESTABLISHMENT ACT • COSUMER PROTECTION ACT • WEIGHT & MEASUREMENT ACT • PACKAGING ACT • PREVENTION OF FOOD ADULTRATION ACT • PREVENTION OF BLOCK MARKETING ACT • ANTI HOARDING & PROFEELING ACT • MONEY LENDING ACT • PRODEND FUND ACT • MINIMUM WAGES ACT • ESI ACT • GRATUITY ACT • BONUS ACT ENTRY TAX FDI in Retail Trade ANTI SOCAL ELEMENTS CENTRAL EXCISE POLITICIAL INTERFERANCE PURCHASE TAX INCOME TAX POOR MARKET CONDITION POWER PROBLEM Cash Transaction Tax & Quarterly ‘C’ Form INSPECTOR RAJ STAMP DUTY WELTH TAX HIGH BANK CHARGES PROFESSIONAL TAX New Naka Complex Presented By Mr. B.C.Bhartia,Nagpur. ESSENTIAL COMMODITIES ACT

  9. What Is Food Security? The World Food Summit of 1996 defined food security as existing “when all people at all times have access to sufficient, safe, nutritious food to maintain a healthy and active life”. Thus food security implies both physical and economic access to food that meets their dietary needs, nutritional requirements and food preferences. Nutritious food providers have three functions: Making it Available at Affordable prices and creating Awarenessto the consumers

  10. Food security: India ranks lower than Rwanda According to the International Food Policy Research Institute's Global Hunger Index, 2011, India ranks 67 of the 81 countries of the world with the worst food security status. The GHI is composed of three equally weighted indicators - the proportion of the population that is undernourished, the proportion of children who are underweight and under-five child mortality. N.Viswanadham

  11. India needs to Usher the Agri-Service Revolution A strategic vision for the Agri-service sector Streamline and upgrade the agri-service chains using modern technologies: Demand driven agriculture, Processing industry, Visibility Initiate education, research and entrepreneurial programs in Agri-Service sector innovation Plan and Build integrated Food -service systems in rural and urban areas N.Viswanadham

  12. Specific Five things India Needs Post Harvest Research Food Manufacturing with Added Vitamins And Minerals Distribute Nutritious Food not Grains Attention to supply chain and logistics and minimize wastage Regulations by the State and Centre Governments : APMC act, Minimum support price act, etc N.Viswanadham

  13. New to Market InnovationFood Product Market Estimation • Estimate your market rightHow many people will buy orange juice packets if it is as cheap as a coffee or tea on a road side stall and costs only Rs 5 Look at the reduction in the disease burden N.Viswanadham

  14. Food Security Solution: To Serve 100M Urban Poor Vocational Training Consumers Households Processed Food Products Distribution Center Mid Day Meals PDS Distribution Center Kitchen Meat & Diary Products Hawkers Distribution Center Kitchen IT Backbone on Cloud

  15. The IIT Kharagpur Initiative This initiative fills in the much needed research efforts in the supply chain, logistics and food security areas The involvement of the IIT faculty and research students would make a much needed contribution to the food security in India and the world. N.Viswanadham

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