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Journalism of Courage
Big organised retail is the best way to get fresh fruit and other perishables to plates
India is now the second largest global producer of fruit and vegetables at 11.84 and 13.36 per cent of the world total. This has happened in the space of 10 years. In the same period,the cumulative investment in warehouses by the Central government was just Rs 350 crore far from developing a national chain of air-conditioned warehouses for perishable products,it does not even begin to make the down payment for the venture. This is the reason why fruit and vegetable prices shoot up in urban markets when the season changes. It is a useful perspective to consider in the debate on foreign investment in multibrand retail.
Scientific,organised retail with size and scale is the solution,and it will get a head start from FDI. Money is required in the sector and neither the states nor the Central government have the money to modernise the farm to table chain. Agriculture ministry data also shows public investment in the sector by state governments in this period has plummeted for states like West Bengal (by 49 per cent),Uttar Pradesh (by 11.5 per cent) and even Goa (by 12 per cent). Gross public investment in the farm sector as a percentage of GDP has stagnated at 15 per cent till 2006-07. These are the reasons why the recently released Global Food Security Index compiled by the Economist Intelligence Unit places India at No. 66,in the company of some chronically malnourished African countries. The figures reinforce the National Sample Surveys 66th round data for 2009-10. Of the total food expenditure in rural India,only 29 per cent is accounted for by cereals; it is even lower at 22 per cent for urban India. Milk and vegetables account for a much larger percentage of the food basket at 27 per cent for rural India and 30 per cent for urban.
Affordability and quality can only be improved by repairing the broken down investment chain. As the experience of the last ten years shows,the government cannot do it. Turning to large-scale investment by the private sector and to FDI remains the best option.
