Food Supply Chain in India: Objectives, Importance, Advantages, Best Practices, Case Study

In India, we traditionally revere the farmers for putting food on our plates. However, we conveniently forget about all the supply chain components. All participants and processes of the food supply chain in India are responsible for ensuring that nourishment reaches the mammoth 1.4 billion population. This blog discusses the importance of the food supply chain in India and how it can be improved.

What is the Food Supply Chain in India?

When discussing supply chain, we are not talking about a unit. Rather a series of participants and processes at various levels working together to ensure the product reaches the consumers. Regarding food supply chains in India, both formal and informal sectors work together to make this happen. The key elements or components forming the system include:

• Consumer Demand: Production depends on the demand of consumers. Mostly this is overlooked. But, it is the most important part of the planning for the supply chain. In India, consumers can be divided into 4 categories depending on their food preferences:
  • Vegans: Those who only eat plant-based food.
  • Vegetarians: Those who also consume milk and milk products.
  • Eggetarians: Those vegetarians who eat eggs but avoid meat.
  • Meat eaters: Those who eat all types of veg and non-veg food.
• Food Production: The food supply chain in India starts with agriculture. Farmers are the “annadata” or food providers of India. These farmers are mostly informal and unorganised. Here are the main products for different consumers:
  • Crops are cultivated for vegan and vegetarian people.
  • Livestock preferably cows are bred for milk for vegetarian consumers.
  • Poultry farming is conducted for eggetarians and meat eaters.
  • Livestock mostly cattle are bred for feeding meat eaters. Cows are avoided for meat as they are holy animals for Hindus.
  • For seafood, mariculture is followed, mostly in the coastal regions.
• Processing: 
• Distribution: At the distribution stage various service providers and intermediaries get involved. Components of food distribution include:
  • Transporters: India is the 7th largest country by landmass and is diverse in all aspects. Thus, logistics is the key component of distribution.
  • Wholesalers: Wholesalers procure unprocessed food from farmers and processed food from factories. They work as intermediaries and sell the goods to retailers.
  • Retailers: Retailers are the actual point of contact for end consumers.
• Consumption: Final consumers or people buy food from retailers and consume it.

So, what is the food supply chain in India? It is an aggregation of people, processes and intermediaries that come together to perform their roles so that food reaches from farms to consumers.

Objectives of Food Supply Chain in India

It might occur to you that why this whole concept of supply chain. What are the objectives of the food supply chain in India? Here’s what purposes are fulfilled by the supply chain:

• It ensures that all the food products are delivered to consumers on time.
• There is less wastage of perishable goods.
• Reduce the wastage of food during transportation and storage.
• Ensure that the products maintain the highest quality and safety standards.
• Creating a win-win for all parties involved.
• Farmers get the best price while consumers can get food at affordable rates.
• Lower costs with efficient supply chain management.
• Helps promote sustainable farming.
• Minimises the impact on the environment.
• Improves transparency with real-time tracking across the supply chain.
• Better collaboration between farmers, intermediaries and retailers

Importance of Food Supply Chain in India

Why is a food supply chain important? Especially in a country like India. Let’s discuss the importance of the food supply chain in India in this section:

• Farmers and unorganised food processors work in remote areas without proper city connectivity.
• Fast transport of food items as their shelf life is less.
• It supports the livelihood of millions of workers in this sector.
• Lesser wastage of food and quality food is available before perishing.
• It balances the demand and supply of food products.
• Saves food from rotting and facilitates export.
• Allows space for innovation in agriculture and allied activities.

History of Food Supply Chain in India

India was prone to regular famines and droughts under the British Rule that caused:

• Food shortages
• Multiple deaths
• Malnutrition in newborns
• Increased infant mortality
• More maternal mortality as pregnant women couldn’t get proper nourishment
• Debt traps for medical costs drowned families of their savings
• Huge economic pressure

Some of these famines were natural while some were artificially created. But, the history of the food supply chain in India was written after the 1960s. The Indian government introduced the much-needed Green Revolution initiative to ensure that every Indian got food security. 

High-yielding varieties of crops were introduced, irrigation systems were modernised, and machines were introduced to replace manual labor. Food supply chains in India were built to reach the remotest areas, and all-weather roads were built to ensure connectivity. As a result, a country that once heavily depended on imported food became a food surplus.

How does the Food Supply Chain Work in India?

While there are many types of food supply chains in India, to understand how they function, you need to break them down and see how each component functions individually.