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SPECIAL REPORTS

Cold chain to reach Rs 3,79,870 cr by 2028
Tuesday, 02 April, 2024, 08 : 00 AM [IST]
Venkatesh Ganapathy
Introduction
The cold chain infrastructure is a critical component of agriculture and related sectors, ensuring the safe storage, transportation, and distribution of perishable goods like fruits, vegetables, and livestock products. In India, the agriculture and allied sectors contribute significantly to the GDP and employment rates. The Indian cold chain market size has been growing substantially, reaching Rs 1,81,490 crore in 2022 and is projected to reach Rs 3,79,870 crore by 2028 with a growth rate (CAGR) of 12.3% during 2023-2028.

The market growth is driven by increasing demand for perishable goods and advancements in refrigeration technology. The cold chain sector plays a crucial role in ensuring food safety, reducing post-harvest losses, and supporting various industries like pharmaceuticals and food processing. The cold chain sector plays a crucial role in preserving product freshness, reducing spoilage, and ensuring consumer access to a variety of products while maintaining quality standards. The pharmaceutical industry relies on the cold chain for transporting temperature-sensitive vaccines and medicines.

The cold chain infrastructure is vital for preserving perishable goods like fruits, vegetables, and livestock products. Improving cold chains and post-harvest infrastructure can reduce waste, boost exports, and increase farmers' income. This effort aligns with the Sustainable Development Goal of zero hunger, aiming to eradicate hunger, enhance agricultural productivity, and double incomes for small-scale food producers.

Steps taken by the Government to improve the infrastructure
The cold chain infrastructure plays a crucial role not only in agriculture and related industries but also in food processing, vaccine storage, and the chemical sector. Recognising its significance, the Government of India has implemented various initiatives to enhance this infrastructure. One such initiative is the Pradhan Mantri Kisan Sampada Yojana (PMKSY), a Central sector scheme launched in 2017 with an initial allocation of Rs 6,000 crore. This scheme aims to develop modern infrastructure with efficient supply chain management from farm gates to retail outlets, supporting components like integrated cold chain facilities, agro-processing clusters, food processing capacities, food safety infrastructure, and Operation Greens.

Under the PMKSY, the Integrated Cold Chain and Value Addition Infrastructure scheme focuses on establishing seamless cold chain facilities to minimise losses and enhance efficiency in collecting, storing, transporting, and processing farmers' produce. Both horticultural and non-horticultural products are eligible for support under this scheme. As of December 31, 2022, a cold storage capacity of 8.38 lakh MT has been established. The Creation of Infrastructure for Agro-Processing Clusters aims to build modern infrastructure near production areas with preservation facilities and strong linkages for food processing.

Operation Greens is another component of PMKSY that focuses on enhancing the value realisation for Tomato, Onion, and Potato farmers through targeted interventions and subsidies on transportation/storage.The Ministry of Food Processing Industries anticipates that the PM Kisan Sampada Yojana will attract investments totalling Rs 11,095.93 crore by 2025-26, benefiting a significant number of farmers and generating substantial direct/indirect employment opportunities across the country.

The Integrated Cold Chain and Value Addition Infrastructure scheme, initiated in 2008, offers financial aid of up to Rs 10 crore per project to establish infrastructure facilities across the entire supply chain. This includes pre-cooling, weighing, sorting, grading, waxing facilities at the farm level, various cold storage options, packing facilities, and transportation solutions for different products like horticulture, non-horticulture, fish/marine products, dairy, meat, and poultry. A study by NABARD highlights the need for an additional cold storage capacity of 3.5 million MT in India. Under this scheme, 376 cold chain projects have been approved, with 268 operationalised projects.

What does the future portend?
The government's efforts through schemes like PMKSY aim to enhance this infrastructure to reduce waste, boost exports, and improve farmers' income. The development of cold chain infrastructure is essential not only for economic growth but also for ensuring food security and reducing wastage.

The Pradhan Mantri Matsya Sampada Yojana, launched in 2020 with an investment of Rs 20,050 crore over five years, aims to address critical gaps in fish production, quality, technology, and post-harvest infrastructure. This scheme emphasises the development of a seamless cold chain, modernisation of the value chain, reduction of post-harvest losses, and enhancement of traceability. By 2024-25, the scheme targets increasing fish production to 22 million MT, boosting exports to Rs 1 lakh crore, and generating around 55 lakh direct and indirect employment opportunities.

Under this scheme, various initiatives focus on enhancing fish production and productivity while improving aquaculture practices and increasing domestic fish consumption. The goal is to double the income of fishers and fish farmers while reducing post-harvest losses significantly. The scheme also aims to elevate the contribution of the fisheries sector to the Agriculture GVA and enhance export revenue substantially by 2024-25. By promoting activities like seaweed cultivation and ornamental fish breeding, the PM Matsya Sampada Yojana seeks to drive sustainable development in India's fisheries sector.

The implementation of the Pradhan Mantri Matsya Sampada Yojana involves key activities such as fishing vessel insurance, support for new/upgraded fishing vessels, aquaculture development in saline/alkaline areas, nucleus breeding centres, start-ups in fisheries and aquaculture, and integrated aqua parks. This comprehensive approach covers various aspects of the fisheries value chain to ensure holistic development. By leveraging this scheme in collaboration with states/Union territories, India aims to harness the full potential of its fisheries sector for economic growth and sustainable development.

The cold chain sector in India is of growing importance due to its critical role in preserving perishable products like fruits, vegetables, and livestock. The sector contributes significantly to the economy, with agriculture and allied sectors accounting for 18.3% of GDP and employing 45.5% of the population. The Indian government is actively supporting the development of cold chain infrastructure through schemes like Pradhan Mantri Kisan Sampada Yojana, aiming to reduce post-harvest losses, enhance food security, create a surplus for exports, and increase farmers' income. Investments in modern infrastructure and technology are key to revolutionising India's agriculture and ensuring sustainable growth.

The cold storage sector in India faces challenges like lack of awareness, high costs, inadequate infrastructure, fuel price fluctuations, and technological lag. These hurdles hinder efficient operations and growth, impacting the industry's potential for enhancing food security and reducing wastage. These challenges have to be addressed to enhance food security, reduce post-harvest losses, and boost the economy.

The future of the cold storage sector in India is promising, with significant growth potential driven by increasing production of perishable goods, rising incomes, and government support. The industry is still in its early stages but growing rapidly.

(The author is a doctoral research scholar at Presidency University, Bangalore)
 
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