See discussions, stats, and author profiles for this publication at: [Link]

net/publication/344441289

Cold Storage in India: Challenges and Prospects

Article · October 2020

CITATIONS READS

0 842

1 author:

Minakshi Chakraborty
Mahindra
20 PUBLICATIONS   0 CITATIONS   

SEE PROFILE

All content following this page was uploaded by Minakshi Chakraborty on 01 October 2020.

The user has requested enhancement of the downloaded file.

 Cold Storage in India: Challenges and Prospects
Article ID: 32156
Dr. Minakshi Chakraborty1
1
DGM-Rural & Agri Economist, Mahindra & Mahindra.

Agriculture sector in India has moved from traditional agriculture in the 1950s to a highly capital-intensive
sector. This evolution has transformed Indian Agriculture from a food grain deficient economy to a food grain
surplus economy. Further, agriculture in India, today is not just limited to food grains, it has expanded to diverse
crops, like, horticulture, medicinal and other allied activities. This transformation is expected to grow as more
Farmer Producer Organisations (FPO) are created and through impetus from Cooperatives or other
collaborative farming practices, there is a likelihood that entire villages will collaborate as farmer groups and
operate farms collectively in the shape of Village Producer Organisations (VPOs) (NABARD, 2015). Thus, the
scale of production in meeting the growing demand is no longer a concern. The focus has now shifted to
maximising returns to the farmers by improving resource use and input management and providing easy and
affordable access to the large population.
Over the past decades, significant focus and resources have been allocated to increase food production. For
example, 95% of the research investments during the past 30 years were reported to have focused on increasing
productivity and only 5% directed towards reducing losses (Kader 2005). Efficient management in Post-harvest
stage is critical for attaining the twin objective of maximising returns for farmers and ensuring food security.
Food and Agriculture Organization of U.N. predicts that about 1.3 billion tons of food are globally wasted or lost
per year (Gustavasson, et al. 2011). Food losses at the post-harvest stage is not only a threat to human
consumption and returns to the farmers, but it can also harm the environment in various ways. Food loss is
estimated to be equivalent to 6- 10 percent of human-generated greenhouse gas emissions (Gustavasson, et al.
2011). A significant contributor of this problem is through methane gas generation in landfills where food waste
decomposes anaerobically (Buzby and Hyman, 2012). On the basis of global food loss and waste (FLW), the
equivalent in CO2 emissions is assessed at 4.4 billion tons per annum. This raises acute concern that food loss
and waste have a major contribution to climate change from greenhouse gases (DFI Committee report, 2017).
In India, food grains surplus is captured by private sector (milling units) and through procurement by Food
Corporation of India, National Agricultural Cooperative Marketing Federation (NAFED) and State government
agencies. However, in case of perishable produce, such as fruits, vegetables and others with lower holding life,
the surplus when not procured, tends to go waste. India witnesses nearly, 4.6 to 15.9% wastage in fruits and
vegetables, 5.2% in inland fish, 10.5% in marine fish, 2.7% in meat and 6.7% in poultry meat (Wold Food India,
2017).
The primary development focus for agricultural post-production infrastructure, has been in the form of
warehousing and cold stores, for holding inventory for extended durations. However, despite the growing focus
on post-harvest management, the cold chain industry in India is still at a nascent stage. Reports on the
postharvest sector and its contributions to economic development (Mrema & Rolle 2002; Kader 2006; Winrock
2009) emphasises the importance and cost effectiveness of cold chain, yet introducing a cold chain in a
developing country requires the integration of a great many different elements and the continuing management
of those elements.
In India, currently there are largely two different schemes to provide financial assistance to set up cold storage
facilities in the country – one under the Mission for Integrated Development for Horticulture (MIDH) of the
agriculture ministry and another called Pradhan Mantri Krishi Sampada Yojana (PMKSY) managed by the
Ministry of Food Processing Industries. Since 2014-15, a total of 1104 cold storage facilities with a total capacity
of 48.34 lakh MT was created under MIDH. About 208 cold chain and value addition infrastructure facilities with
5.3 lakh ton were built under PMKSY till 2019.

Volume 2 - Issue 10 - October 2020 458 | P a g e

However, despite the growth, number of cold storages in India is still inadequate as compared to the,
requirement. As per the estimates of National Centre for Cold Chain Development (NCCD), there is a shortfall
of 126 lakh tons of cold storage capacity. Annual production of fruits and vegetables in the country is about 300
million tonnes. This accounts for 18% of our agricultural output. Due to diverse agro-climatic conditions and
better availability of package of practices, horticulture production is gradually rising. Although, there is a vast
scope for increasing the production, the lack of cold storage and cold chain facilities are becoming major
bottlenecks in tapping the potential.
The cold storage facilities now available are mostly for a single commodity like potato, orange, apple, grapes,
pomegranates, flowers, etc. which results in poor capacity utilization. Currently, there are about 7645 cold
storages in the country with 68% of the capacity being used for potato while 38% is multi commodity cold
storage capacity.
Progress of cold storage in the country has also been extremely skewed. Almost 33% of the cold storage in the
country is in Uttar Pradesh and largely used for storing potato. In terms of requirement of cold storage, as per
horticulture produce, Gujarat fares better than all states in the country. About 15% of the cold storage in the
country is in Gujarat and holds a capacity of 6403 lakh tonne per horticulture produce. This is followed by
Punjab, Telangana, Uttar Pradesh, Rajasthan, Haryana and Orisha where the cold storage capacity is at least
more than 1 lakh tonne per horticulture produce of the state. However, states, like, Maharashtra, Karnataka
with large amount of exportable produce do not have adequate cold storage capacity. Bihar, Chhattisgarh and
West Bengal are the lowest in order in terms of cold storage as per horticulture produce.
Table 1: Statewise status of cold storage in India, 2019
States % contribution to All India cold Cold Storage Capacity per horticulture
storage produce (lakh tonne)
Gujarat 15% 6,403
Punjab 8% 3,908
Telangana 2% 2,969
Uttar Pradesh 33% 2,392
Rajasthan 3% 2,290
Haryana 3% 1,946
Odisha 2% 1,833
Karnataka 3% 796
Maharashtra 7% 766
Andhra Pradesh 4% 701
Madhya Pradesh 3% 556
Tamil Nadu 2% 501
Bihar 3% 343
Chhattisgarh 1% 157
West Bengal 3% 132
Others 4% 200
Source: National Horticulture Board, Lok Sabha unstarred questions
Developing the cold chain in India involves a mix of awareness and technical capacity, investment, information
and technology. transfer, and better governance mechanisms. Given the gap between export-oriented food
chains and domestic traditional food handling, the focus should be on technologies that are economically
accessible and long-term capacity development for the vast number of small- scale food producers and food
chain SMEs. Currently, 95% of the cold storages are owned by the private sector, 3% by cooperatives and the
remaining 2% by public sector undertakings (Crisil,2019). Although private sector actors are primary for
developing and operating the cold chain in a vibrant agro-industry sector, governments can do much to facilitate
private activity.

Volume 2 - Issue 10 - October 2020 459 | P a g e

The long-term solution to increasing farm income lies in the growth of a viable food processing industry being
fed by a robust network of cold storages and transport infrastructure. Based on the growing demand for
processed, food, fresh fruits and vegetables, sea food and biopharmaceuticals in export market, cold storage
industry in India is expected to grow by 13-15% in the next 5 years.
Some of the measures that need to be adopted for a robust growth in cold storage are the following:
1. Link farmers to value chain- Provision of safe, controlled pre-cooling phase in the production stage will help
generate the volume needed to justify cold chain investment.
2. Create incentives for investment in technology for cold storage and process enhancement, thus lowering the
economic barriers for investors and supporting return on investment:
3. Encourage the formation and operation of industry bodies for supply chain actors in the agro-food industry,
logistics companies, technicians and engineering firms specialized in cold chain infrastructure. These bodies can
serve to enable access to technologies/knowledge, finance and equipment, as well as facilitate the dialogue and
coordination necessary for effective cold chain development.
4. Invest in research and development of proper small scale and affordable technologies (i.e. evaporative
cooling, small scale mechanical precooling and refrigeration systems), post-harvest handling techniques, with
particular attention to the needs of small-scale producers and SMEs.
5. Interventions should be adapted to the specific products and geographic and socio-economic conditions.
Feasibility studies are essential before any investment or interventions and must take into account the
conditions of the product supply chain, and its opportunities and weaknesses for development.

References
1. Food and Agriculture Organisation of the United Nations, ‘Developing the cold chain for agriculture in the Near East and North Africa (NENA).
2. National Centre for Cold Chain Development, (2015), “All India Cold Chain Infrastructure Capacity – Assessment of Status and Gap” Ministry of
Agriculture.
3. National Centre for Cold Chain Development, “Challenges to Cold Chain Development” Ministry of Agriculture.
4. Paul, Vijay and Rakesh Pandey (2016), “Cold Storage in India: Present Scenario and Future Directions”, Processed Food Industry.
5. Planning Commission (2012), “Report on The Committee of Encouraging Investments in Supply Chains Including Provisions for Cold Storages
for more Efficient Distribution of Farm Produce.”
6. Sivaraman, Madhu (2016), “Government’s role in India’s ailing Cold Storage Sector”, Centre for Public Policy Research.
7. Singhal, Robin and Shalini Saksena (2017), “Performance Assessment of the Storage and Warehousing Industry in India”, The Journal of Industrial
Statistics, 6 (1), 15-40.
8. Gustavsson, J., Cederberg, C., Sonesson, U., van Otterdijk, R., Meybeck, A. (2011), ‘Global Food Losses and Food Waste: Extent Causes and
Prevention’, Rome, Food and Agriculture Organization (FAO) of the United Nations.
9. Kader, A.A. (2005), ‘Increasing food availability by reducing postharvest losses of fresh produce’. Acta Horticulture 682, 2169–2176.
10. Mrema, G.C. and R.S. Rolle (2002), ‘Status of the postharvest sector and its contribution to agricultural development and economic growth’, 9th
JIRCAS International Symposium on ‘ValueAddition to Agricultural Products’, Ibaraki, Japan, pp.13-20.
11. Kader, A.A. (2006), ‘The return on investment in postharvest technology for assuring quality and food safety in horticultural crops.’ Journal of
Agricultural Investment 4: 45-54.
12. Winrock International (2009). ‘Empowering agriculture: energy solutions for horticulture’. USAID Office of Infrastructure and Engineering and
the Office of Agriculture; 79p. Available online: [Link]
13. Buzby, Jean C and Jeffry Hyman (2012), “Total and Per Capita Value of Food Loss in the United States”, Food Policy, Vol- 37, 561-570.

Volume 2 - Issue 10 - October 2020 460 | P a g e

View publication stats