Q) India of the 21st century needs post-harvest or food processing revolution and value addition amid increasing agriculture production. Critically analyse.
Why this Question
Important part of GS paper- III.
Key Demand of the Question:
Give a detailed account of the need of post harvest linkages or food processing revolution in India and the impact it will have on farmers.
Critically analyse - The key to tackling this question is providing ample evidence to support the claims. Ensure that the analysis is balanced by shedding light on, and presenting a critique of, and alternative perspectives. Present extensive evidence taken from a varying range of sources.
Give an overview of the current state of Food processing in India.
In the first part, highlight the need for food processing in India.
In the next part, highlight the impact or will have on farmers as well as the overall economy. Also mention the challenges ahead.
Conclude with a way forward.
Food processing provides an opportunity to utilise excess production efficiently. Not just from an agricultural growth perspective, but it is also important for reducing food wastage as it increases shelf life and enhances quality. It is thus an integral part of the food supply chain in the global economy and India has also started to see growth in this in the past few years.
Need for Food Processing in India
- It has the potential of reducing enormous wastage of agricultural produce due to leakages in the supply chain and absence of processing technologies and cold chain facilities.
- It is a labour-intensive industry that has the potential to employ 13 million people directly and 35 million people indirectly.
- Low level of farm income whose key reason is leakages in the food chain.
- Lower potential of India in the exports of such commodities.
Impact it will have in India
- It will also lead to an increase in farm income, generate employment opportunities, foster forward and backward linkage effects.
- It will promote exports of agricultural commodities both processed and unprocessed and integrate India into the global supply chain.
Challenges to the FPI ( Food Processing Industry) in India
- Small and dispersed marketable surplus due to fragmented holdings, low farm productivity due to lack of mechanization, high seasonality, perishability and lack of proper intermediation (supply chain) result in lack of availability of raw material.
- Demand for processed food has not yet reached a threshold level. It is mostly restricted to the urban areas.
- Lack of adequate infrastructure leads to major losses for the food processing industries.
- It has a high concentration of unorganised segments, representing almost 75% across all product categories. This causes inefficiencies in the existing production system.
- Lack of uniform legislation governing the food processing industries.
- Concerns like mounting cost of finance, lack of skilled and trained manpower, inadequate quality control and packaging units and high taxes and duties, thwart development of FPI.
Measures needed to boost FPI in India
- A uniform legislation covering all aspects of food processing is needed
- Development of infrastructure is the first and the foremost step.
- Integration of the small and medium industries based in the rural and semi urban areas into the national food supply chain.
- Fiscal incentives to the FPIs especially those having resource crunch.
- Skill development of people in food processing technologies.
The need today is to treat food processing as part of the overall food sector and provide all the facilities, exemptions, and concessions as available to agriculture and related activities. This will not only enhance the nutritional security in India but also help in realizing the goal of doubling farmers’ incomes by 2022.