Doubling farmers’ income cannot happen without increasing sales and market rate of their produce. Cold chains can certainly make this happen

Around 60 per cent of the population in India lives in rural areas and is mostly engaged in agriculture. The Indian Government has committed to double the farmers’ income by 2022. The real issue, however, is not the level of productivity but how the produce can create value. This is what can decide the farmers’ income. It is a fact that today, no industrialised nation can survive without agriculture. Globally, 60 to 80 per cent of the movement of goods happen around agriculture or its produce. The rich get the spending scales up on fresh and organic food.

It is here that logistics can be one of the solutions to enhance the backbone of agriculture trade. The architecture behind it has to be marketing. Recently, in Karnataka, tomatoes were sold at Rs 4 per kg. To the contrary, in Delhi, they were sold at Rs 40 per kg. Tomatoes did not undertake any change to its essential characteristics or value but were merely prepared to make it marketable over a scheduled period of time. The value-add to the farmer comes from him being able to access destinations, where demand dynamics offer higher price than the collective cost of production and logistics. Integrated logistics can play a pivotal role in achieving this vision.

To meet the end, for the first time, a senior bureaucrat has been given the charge to streamline and integrate logistics in the Ministry of Commerce and Industry. Further, the need is to ensure that the farmers are able to capture the maximum value for every grain, every drop and every ounce of what they produce. And for this to happen, there is a need to connect a large number of agricultural households with mass consumption markets, both domestic and global.

This will also help the consumers. To cite an example, if a customer is sitting in Delhi, he can order half a kg of Darjeeling tea from a grower in West Bengal or maybe a consumer from Kerala can order 5 kg of basmati rice from Punjab. The day India achieves this, our farmer’s income will increase multi-fold. The focus must shift from increasing per acre productivity to gainfully employ farm households in other farm-related activities and post-production, focus must be on improving value-addition by way of pooling of land and aggregation of farmers’ produce to give the growers a better bargaining power in the market.

This can be possible by upgrading and harmonising agri-logistics, agro-processing and agri-marketing. And for this, the focus must be on the development of sustainable and efficient cold-chain infrastructure in India, which can also offer huge business opportunities to entrepreneurs.

Further, there has been a steady growth on the cold storage front — more than 10 million metric tonnes of capacity has been developed in the last 10 years. In and all, the country has witnessed the commissioning of around 30.4 million metric tonnes of cold storage capacity. However, there is an essential link between stored products and markets in the refrigerated transport sector that has not developed at the same pace as the storage industry. As per the National Center for Cold Chain Development (NCCD) study in 2015, there is a shortage of 69,831 integrated pack-houses, 52,826 reefer transport, 8,319 ripening units in India.

We must protect those, who provide food for the nation. The doubling of farmers’ income cannot happen without increasing sales and market rate of their agricultural produce. Cold chain can, certainly, be a key enabler to make this a reality. One needs to find solutions for crop-specific agriculture logistics and leverage the multi-modal transportation system.

What we need in India is to create an effective cold-chain solution that will integrate the supply chains for agricultural produce from its respective production centres to consumption centres, thereby reducing physical waste and loss of value of perishable commodities.

With cold chains, many gaps in improper post-harvest handling and storage, packaging, inappropriate handling during transportation and storage, absence of grading or sorting and multiple handling points due to a large number of intermediaries can be bridged.

Connecting Indian villages with global markets is absolutely essential not only for doubling farmers’ income but to also understand that whoever has the agrarian power, will rule the world in the times to come.

(The writer is Principal Director, PHD Chamber of Commerce and Industry, New Delhi)