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Industry needs to deal with regulatory hurdles
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Thursday, 02 January, 2025, 08 : 00 AM [IST]
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Major Dinesh Sharma
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The food processing industry in India, which is referred to as the 'sunrise sector' in economic terms, is a key part of the country's overall development. The industry contributes more than 10% of the GDP derived from agriculture, establishing a connection between farm outputs and the consumers' market, thereby minimising waste while enhancing output. Some daunting tasks linger as the population is growing at an unprecedented rate. In fact, the population is predicted to reach more than 1.515 billion by the year 2030.
India will have to deal with the dichotomy of satisfying domestic consumption and complying with high global food standards. Unsafe food is a substantial health risk in India and leads to almost 100,000 deaths a year and more than 15 billion dollars of economic losses worldwide. These challenges have to be met if India wants to become an eventual global exporter and transformer of food processing.
India's Food Processing Landscape
India's food processing industry can be considered highly fragmented as more than 25 lakh unregistered units and a great number of unmonitored small and medium enterprises. It provides employment to millions, especially in the countryside, and has an important place in the value chain between agricultural production and the markets. In spite of such developments, the industry is well known to be beset by sheer tribulations. There are inadequacies with regard to safety, and where there are systems, dominantly smallholder farmers sustain inconsistent control measures. In the first place, the weakness of the infrastructure of the transport and storage facilities worsens the already existing problem of contamination, spoilage, and wastage. Such systemic inefficiencies impact the food safety of the country, but they are also an area that has the potential to have far-reaching effects on the international competitiveness of the industry. In the international marketplace, uniformity, consistency, and GMPs are non-negotiable.
Hurdles in Harmonisation
In the last few years, substantial progress has been made in India's food laws regulatory framework under the leadership of the Food Safety and Standards Authority of India (FSSAI). To that end, the FSSAI has rolled out guidance that seeks to enhance the safety of food products. It also aims to create awareness among users and make domestic legislation compliant with international standards. However, enforcement deficits still pose major issues. Although there are global standards like the FSMA used in USA or HACCP systems applied within the European Union, which are more focused on preventive controls and recall systems, the multiplicity of enforcement structures in India often renders compliance unattainable. Furthermore, exporters in India often have additional difficulty complying with different international requirements because of the varying permissible levels of pesticide residues that are a barrier to the market.
Technology as a Game-Changer
Technology incorporation is a game changer for regulatory issues in India's food processing and other sectors. For example, blockchain technology improves traceability through visibility across supply chains. This is particularly useful in India, where fragmentation of operations increases the threat of adulteration and contamination. Real-time monitoring of storage and transport conditions using artificial intelligence (AI) and the Internet of Things (IoT) technologies also minimises wastage and ensures the proper execution of safety protocols. For illustration, FSSAI's Food Safety Compliance System (FoSCoS) provides a fully online licensing system, inspections, and monitoring platform, which makes compliance for businesses and regulators more efficient and less tedious.
Emerging Food Technologies and Their Regulation
Technologies such as plant-based proteins, lab-grown meat, and bioengineered foods are developing and have prospects but also regulatory concerns. These innovations may help alleviate food insecurity and sustainability issues. However, appropriate regulations must be implemented to ensure the safety and confidence of consumers. As for plant-based alternatives, which are becoming more accepted among the Indian population, there is a lack of proper regulations regarding labelling, safety, and nutrition claims. It is important to develop these standards so that they help facilitate innovation and acceptance by consumers in this space.
Government Initiatives to Strengthen the Sector
Emerging challenges of food safety and regulatory compliance have prompted a response from the Indian government. This has rolled out safeguards that enhance the food processing sector. The Eat Right India Movement by the Food Safety and Standards Authority of India (FSSAI), emphasises food safety and affordable nutrition by promoting healthy eating behaviours and staple food fortification to alleviate malnutrition, which is a very critical public health issue in India. Under the One Nation, One Standard policy, local domestic safety standards will be integrated with global standards to enhance export competitiveness and also reduce regulatory inconsistencies among regions in the entire nation.
In addition, the Production-Linked Incentive (PLI) Scheme, which provides cash subsidies for technological investments, will induce firms to spend on quality enhancements and enhance their competitiveness in the international market. Another key initiative, the Mega Food Parks Scheme, provides modern infrastructure for food processing, food testing, and food storage, thereby closing crucial gaps in the value chain and ensuring better compliance across the sector. This combination of initiatives is expected to address food safety regulatory burdens while promoting the global competitiveness of India's agricultural products and the security and nutrition content of food products marketed to Indian consumers.
Sustainable Practices in Food Processing Laws and Regulations in India
India has also incorporated sustainability in food processing laws and regulations due to the benefactor climate change. The increase in temperatures and climate shifts has also increased the relative occurrence of toxins like mycotoxins, calling for measures along the value chain. The FSSAI has also adopted green strategies, including the use of recycled materials in products and advertising campaigns to prevent food surplus. These initiatives are in line with NAPCC's objectives and targets that seek to curb the effects of climate change through sustainable agriculture practices.
The Path Ahead
India's food industry has the potential to emerge as a global powerhouse in terms of food processing, but there is a need to deal with its regulatory hurdles. It is also important to align local and global standards to maintain security and to benefit from exports. Furthermore, the government needs to support small to medium enterprises (SMEs), as these are the core of the industry. Assistance of SMEs without the hassle of finance can be achieved through subsidised certifications, cheap testing labs, and capacity building. It is also important to highlight that customers are key stakeholders in regulatory compliance. They can use their purchasing power to push for change within the industry by their preference for ethical businesses that are compliant with fiscal policies.
In conclusion, India's commitment to becoming a world leader in food processing is more than just an issue of meeting food standards; it is about building a framework of safety, sustainability, and trust. While the challenges are considerable, the prospects of improving public health, increasing exports, and stimulating economic growth are even more promising.
By 2030, India will lead the world by showing how regulatory efficiency, advances in technology, and efforts of various stakeholders can change the food processing industry for the good. Such change will not only be critical to the Indian economy but also to ensure that every Indian citizen has access to safe, healthy, and responsibly sourced food.
(The author is co-founder, Academy of Pastry and Culinary Arts)
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