- Agro processing industry which includes food processing, forms an important segment of the Indian economy in terms of contribution to GDP, employment and investment, and is going to be a major driving force in the country’s growth in the near future. It provides employment to rural areas and helps in narrowing down the economic disparity between rural and urban population.
- In spite of having prominent parameters in its favour, the food processing has not been able to achieve the growth it deserves and processing activities in India are still at a nascent stage. Compared to other developed countries, the food processing in India is at very low level i.e. 2.2% for fruits and vegetables, around 35% in milk, 21% in meat and 6% in poultry products.
- With rising purchasing power and growing nuclear families, the demand for processed foods, online marketing is witnessing a substantial surge. These factors are further inducing the need for sophistication in various segments of agribusiness such as procurement, storage, transportation, distribution, etc.
- There is sufficient production of fruits, vegetables, milk and other such products in the country but the post-harvest losses are very high. Improvement in processing facilities and cold supply chain will not only help in reducing the post-harvest losses of perishable products but also will cater the demand of processed food.
- Food processing sector in the country is mainly handled by the unorganized sector. About, 42% of the output comes from the unorganized sector which is dominated by small scale industries, 25% comes from the organized sector and the rest from the small-scale players.
- Indian share in world agriculture trade is 2.2% only. The higher global demand for processed products provides greater scope for value addition and foreign exchange earnings.
- Efficient and sufficient logistic system is basic necessity to minimise the post-harvest losses and to provide an option of pledge financing to avoid distress sale. This includes timely and speedy movement of goods to the marketing destination and keeping them safe for availing in the off-peak season. The seasonality in production and perishable nature of agriculture and horticulture produce make it imperative.
With increasing urbanization together with growth of organized retail, food servicing and food processing sector at home and abroad, there has been a surge in the demand for the cold chain facilities in storage and transportation. Therefore, sufficient and efficient cold supply chain will play a significant role in boosting the domestic and export trade of perishable products.