Oil & Food Journal December - 2014 by Advance Info Media & Events

Vol 10 Issue 02 December 2014

Rs.100/-

Innovatively growing and enhancing

Vol. 10 Issue 02 December 2014

CONTENTS

Vol. 10 Issue 02 December 2014

EDITORIAL

as the editor of this journal usually am jeopardized about what to write, what novel news and information about the food industry can I share- that can hold my readers attention and make them flip to other pages……well not only flip but also read it. One thing I am sure that oil and food journal provides the best content for the food industry experts and readers. Coming to the main point, today I will focus on the augmentation of food processing industry of India vis a vis the food parks, growth of processing industry and the effect of WTO pact. Many Food processing parks are being established, which is in fact very good news. Setting up of mega food parks is the need of the hour to expand the scope of the food processing industry. Mega food parks can enhance the development of Indian food industry infinite and is be the major food wastage reducer. Every year food items ranging between 6-18 per cent were wasted. We are ranked first in the world in milk production, second in wheat production and third in fisheries. However, only 10 per cent of the produce is utilized by the food processing industry. There is a huge potential for growth in this sector. This could be gauged from the fact the sector was growing at 8.6 per cent against the industrial growth rate of 6 per cent and agriculture growth of 3 per cent. Mega Food Park has been set up Dabwala Kalan (Fazilka) in Punjab at a cost of Rs 136 crore. This is the fourth such park set up in the country. ITC would set up the next food park in Kapurthala at a cost of Rs 1,000 crore. Another mega food park in Karnataka's Tumkur that was inaugurated by Prime Minister Narendra Modi is set on 110 acres, 22,000-tonne storage capacity, 30 food processing companies and an investment of Rs. 1000 crores. The park is expected to generate 4000 jobs. Government has approved 17 food parks across the country over which will unfold in the coming months, attracting investments of about Rs 2,100 crore. I will like applaud our union ministry for food processing is fulfilling her promise to reduce the food wastage and is working on promoting the industry to the next level. Well development of this sunrise sector is not till here in fact, The Cabinet Committee on Economic Affairs (CCEA), chaired by the Prime Minister Narendra Modi, has approved the inclusion of all North Eastern States for setting up food processing units within the Sub scheme of the Horticulture Mission for North East & Himalayan States (HMNEH) of the Integrated Mission for Development of Horticulture (MIDH). North Eastern States, which are horticultural rich, will be able to take up projects on food processing industries, thus enabling better shelf life and value addition of produce. The programme for setting up food processing units will cover all States in the North East and the Himalayan Region of the country. Well the work and its result is obviously very transparent, because recent study has shown that the Indian food processing sector is likely to grow at the rate of over 10 percent from 2015 onwards. The study jointly conducted by PHD Chamber and Technopak said the private sector is committed to invest in the expansion of their manufacturing units in the food processing sector, especially after the call of 'Make in India', given by Prime Minister Narendra Modi. The food processing sector, which ranks at fifth presently world over in terms of production, growth, consumption and export is likely to reach at USD 194 billion by end of 2015. The fact at the moment is that at the domestic front, demand for processed food and food products comprise a third of total demand. However, growing population along with desire for convenience would drive the demand for processed food. Food processing industry is carving a niche of its own, with historic development and impressive effort. I think I might of given you a basic insight of what you will issue, facts and essentials. Thank you, rest will be next, Happy New Year in Advance!

Vol. 10 Issue 02 December 2014

fter indicating to revoke the import ban on mangoes and four other farm produce from India, a team of European experts will visit the country next week to inspect pesticide levels in sesame seeds used in confectionery. The experts are likely to visit India starting 9 December, a government official said. “They want to inspect our processing units and laboratories, mostly in Gujarat and Maharashtra, to test the phytosanitary certification system,” he said, requesting anonymity. “It is a good thing they are coming. We are confident of the facilities available.” Phytosanitary refers to the health of plants, especially with respect to the requirements of international trade. The European Union (EU) and Japan could provide a big business opportunity for sesame seed producers in India, the official said. “Japan and the EU put together provide a market of around $600 million for sesame seeds. Japan wants organic sesame seeds while the EU wants pest-free sesame seeds. Japan is currently saying that sesame seeds produced by India has too much pesticides. So they don't want to import from India. But the same Indian sesame seed is going to Japan through Vietnam and South Korea and they have no problem with that,” he said. “If the EU buys from us, then Japan will be forced to open up their market. So, it is in our interest that the EU officials are visiting India.” Citing the presence of pesticides, the EU had banned the import of Alphonso mangoes, brinjal, taro, bitter gourd and snake gourd from 1 May to December 2015. The decision by the grouping's standing committee on plant health came after 207 consignments of fruits and vegetables from India imported into the EU in 2013 were found to be contaminated by pests, including fruit

urrently, the sector is growing at an average rate of 8.4 percent. The study jointly conducted by

flies, the Press Trust of India had reported from London. Although the prohibited commodities represent less than 5% of fresh fruits and vegetables exported to the EU from India, the potential introduction of new pests could pose a threat to EU agriculture and production, the committee noted. The UK's department for environment, food and rural affairs, which backs the ban, said it was necessary because pests could threaten the country's £321 million salad crop industry of tomato and cucumber. The UK imports nearly 16 million mangoes from India and the market for the fruit is worth nearly £6 million a year. After a strong protest by India, a team of experts from the Food and Veterinary Office of the EU visited Indian facilities in September. The EU experts made a favourable report and are expected to revoke the ban soon, the official said. “They wrote to us saying they are satisfied with the visit with the inspection and packaging facilities. The decision has not yet come,” he said. “Now we have made it mandatory that every export of food product to the EU will go through a standard inspection process.” Sesame seed is a high-value cash crop that is used in bread and cakes in Europe. In Japan, the seed is added to salads and baked snacks. Japan is the world's largest sesame seed importer. India exported 299,482 tonnes of sesame seeds in 2013-14 against 389,153 tonnes in 2012-13, the council's data shows.

Vol. 10 Issue 02 December 2014

PHD Cham b e r a n d Techn opak said the private sector is committed to invest in the expansion of their manufacturing units in the food processing sector, especially after the call of 'Make in India', given by Prime Minister Narendra Modi. "Food processing industry is likely to register a consistent growth rate of over 10 percent from 2015 onwards in view of its emerging potential, in which the private sector in this segment has already begun to invest to realize its impending worth," the study added. The study titled as 'India : World's Emerging Food Leader' have projected that its food processing sector, which ranks at ﬁfth presently world over in terms of production, growth, consumption and export is likely to reach at USD 194 billion by end of 2015. Releasing its ﬁndings, PHD Chamber President Sharad Jaipuria said, "On domestic front, demand for processed food and food products comprise a third of total demand. The growing population along with desire for convenience would drive the demand for processed food.” In 2012-13, India registered a 63 percent growth in the exports of agricultural products and processing foods which would naturally multiply in times to come, he added.

Indian agriculture minister, Radha Mohan Singh held a review meeting in Mumbai with state government ofﬁcials

he process of organising small farmers into collectives such as producer companies or cooperatives is attracting the interest of foreign buyers – mainly those from Europe and the West Asia. “Large retail chains in Europe and West Asia are keen to source vegetables from farmer producer organisations (FPOs) here, provided they are offered guarantee on traceability issues,” said Pravesh Sharma, Managing Director of the Small Farmers Agri Business Consortium (SFAC) that is spearheading the creation of FPOs. Retail chains are keen to source green vegetables ranging from cabbage to okra and baby corn among others. “If all goes well, we should have some tie-ups in place by the next vegetable season in winter 2015, ” Sharma added. However, he declined to disclose the names of the foreign retail chains. This is a signiﬁcant development considering that the FPOs are in the nascent stage and is expected to give a further impetus to the creation of such collectives. So far, about 350 FPOs have been set up across the country and another 500 are in the process of being formed, Sharma said Tamil Nadu tops the list of States with 50 farmer producer companies, followed by Uttarakhand with 45, Telangana 44,

Maharashtra and Madhya Pradesh 34 each, Uttar Pradesh 27, Assam 25, and Rajasthan and Gujarat with 22 each. Besides acting as aggregators of farm produce and helping establish market linkages with large buyers, FPOs are also seen as a potential vehicle to foster technology penetration, improve productivity and enable improved access to inputs such as seeds and fertilisers and services such as ﬁnancial and insurance among the farming communities. Apart from enabling the famers to leverage the market for better prices, FPOs also provide a window for channelising the funds under various schemes such as the ongoing Rashtriya Krishi Vikas Yojana. If the interest shown by European and West Asian retail chains fructiﬁes into a formal arrangement, the shipment of vegetables to these regions could see a pick up, once traceability issues are addressed. In the middle of this year, the EU banned import of four Indian vegetables – including eggplants (brinjals and gourds) along with mangoes on the grounds they contained harmful organisms. Even Saudi Arabia recently banned the import of Indian green chillies on the grounds of high pesticide residues. Exports of fresh vegetables from India, excluding onions, for the April-August period stood at 3.33 lakh tonnes, valued at Rs. 939 crore.

Vol. 10 Issue 02 December 2014

of agriculture and animal husbandry department. Mr Singh discussed all the issues relating to agriculture and allied sectors and instructed state government officials to give priority in providing soil health cards to all farmers in the next three years. State government should come forward in making effective use of Kisan Vikas Kendra (KVK) (Farmers development Center) for extension work, Mr Singh stressed, and called upon each scientist to adopt a village for personally monitoring the extension activities. The minister said that he wants the state government to ensure coordination between state agriculture universities, KVKs and government officials. Mr Singh also suggested that a cow sanctuary project may be prepared on the same lines as in Madhya Pradesh. Mr Singh expressed his concern for the decreasing number of livestock population in the State as per the latest census and instructed government officials to take quick action on dairy expansion and Gokul Mission activities in an area of about 2,000 acres in Aarey colony. State government should speed up implementation of schemes and send proposals to the government of India along with a utilisation certificate so that maximum earmarked funds may be allocated. Mr Singh also asked dairy cooperatives to submit projects for modernisation to the National Cooperative Development Corporation (NCDC). State government should ensure proper coordination with the National Fisheries Development Board (NFDB) so that funds worth $10 million allocated under this head may be fully utilised, Mr Singh said

Vol. 10 Issue 02 December 2014

he Ministry of Food Processing Industries is working out on a separate GST regime for the food,

agri and horticulture products in consultation with its all stakeholders in government and non-governmental sector. The aforesaid indication was delivered by the Secretary, Ministry of Food Processing Industries, Mr. Siraj Hussain at an International Conference on India Farm 2 Fork 2014 under aegis of PHD Chamber of Commerce and Industry in New Delhi. As soon as the proposed consultations were over, the Ministry would forward its recommendations to the Finance Ministry, incorporating with

them the tax concessions and incentives required to promote the agri and horti sector so that some of them are reflected in the Budget proposals for fiscal 2015-16, said Mr. Hussain. Elaborating on its suggestion for creation of ec o m m e r c e d e p a r t m e n t , M r. Hussain said, “currently there is no such a thing with the government though e-commerce activities have begun to flourish in other sectors barring food processing in which corporate entry has yet to happen for e-commerce trade for processed food's retailing especially in its non-perishable segment. This issue needs to be taken up by leading Chambers of Commerce and Industry such as PHD Chamber so that a proposed department is created to facilitate ecommerce activities in processed food retailing”. The Minister of State for Agriculture, Dr. Sanjeev Kumar Balyan who while inaugurating the conference said, “the government is working on a

comprehensive national insurance policy for agriculture sector to shield the farming community against all misfortune of their post harvest losses relating to all food and grain products including the damage of crops on account of attacks from pests and other such elements”. Dr. Balyan, however, did not indicate by when the proposed policy would be unveiled but alluded that its salient features be rolled out in the forthcoming budget in which the focus would be for accelerated agri and horticulture production as well as increased yield of food grains including fruit and vegetables also. In his welcome remarks, President of the Chamber Mr. Sharad Jaipuria said that time has come when policy makers should treat agriculture with preferential treatment so that its growth is revived from currently estimated 3.4 per cent per annum to a higher level and the contribution of agri sector to national GDP is accelerated beyond 14 per cent as of now. Among others who participated in the conference comprised the Managing Director of National Horticulture Board Mr. Rajendra Tiwari; Vice Chancellor NIFTEM Dr. Ajit Kumar; President Technopak Ms. Saloni Nangia and Chairman Agribusiness Committee, PHD Chamber Mr. N M Kejriwal.

Software solution for seed, agri-biz launched by Sathguru

athguru Management Consultants has announced the launch of a new MAICE software "MAICE 3", a tablet and server integrated agronomy software solution for the global seed and agri-business companies.

operations provides economic and utility

Maice 3 provides the extra weather and ﬁeld force integration, which facilitate tracking and timely interventions. The all-important weather information customized to current or any desired location and integrated with farmer

Vol. 10 Issue 02 December 2014

value to farmers and extension workers also, said Raghunathan Kannan, Director. It will facilitate driving field force from corporate location and to track their field movements every day. Further, field force and extension workers will be able to send SMS right out of tablet for updating information to stakeholders.

bran and groundnut oil is around 10 per cent of the total value of edible oils produced in the country, while in volume terms it is even less at around ﬁve per cent. Therefore, even if exports are allowed at this juncture, it won't have any impact on prices,” said a senior ofﬁcial.

he government is planning to lift a ban on bulk export of groundnut and rice bran oils, in view of the sharp drop in the prices of high-value edible oils in the open market. According to ofﬁcials, the commerce department has moved a Cabinet note in this regard and the same is expected to be discussed soon. At present, export of all major edible oils is allowed in small packages of ﬁve kg each. Bulk export is banned. “The domestic consumption of both rice

The food ministry, too, is believed to be in favour of allowing export of premium edible oils in bulk. Data from Solvent Extractors' Association, a body of oilseed extractors, showed that in the open market, the price of refined groundnut oil dropped nearly nine per cent in the past month from Rs 88,500 a tonne in October to Rs 81,000 a tonne in November. Similarly, the retail price of refined rice bran oil fell five per cent during the same period from Rs 62,000 a tonne to Rs 59,000 a tonne. The edible oil extraction sector has also demanded lifting of the ban on bulk export of

committed to invest in the expansion of their manufacturing units in the food processing sector, especially after the call of 'Make in India', given by Prime Minister Narendra Modi.

Currently, the sector is growing at an average rate of 8.4 percent. The study jointly conducted by PHD Chamber and Technopak said the private sector is

“Food processing industry is likely to register a consistent growth rate of over 10 percent from 2015 onwards in view of its emerging potential, in which the private sector in this segment has already begun to invest to realize its impending worth," the study added.

Vol. 10 Issue 02 December 2014

premium edible oils. The government had first imposed a ban on bulk export of all edible oils in 2008 for one year, which was subsequently extended. The last extension was granted in 2008. However, in between, the government has allowed export of some edible oils in small packages of five kg each, up to a ceiling of 10,000 tonnes. This ceiling was also later relaxed. However, on the import duty on edible oils, officials said a clear picture is yet to emerge as the Cabinet Secretariat is keen to discuss the proposals put forward by both food and agriculture ministries simultaneously. According to officials, the food ministry favours maintaining a duty differential between crude and refined edible oils at 10 percentage points, while the agriculture ministry wants it to be at 7.5 percentage points. The current import duty on crude edible oils is 2.5 per cent, which is proposed to be increased to five per cent, while that on refined edible oils is 10 per cent.

The study titled as 'India : World's Emerging Food Leader' have projected that its food processing sector, which ranks at ﬁfth presently world over in terms of production, growth, consumption and export is likely to reach at USD 194 billion by end of 2015. Releasing its ﬁndings, PHD Chamber President Sharad Jaipuria said, "On domestic front, demand for processed food and food products comprise a third of total demand. The growing population along with desire for convenience would drive the demand for processed food.” In 2012-13, India registered a 63 percent growth in the exports of agricultural products and processing foods which would naturally multiply in times to come, he added.

FPI

1.Introduction India is the second largest producer of food and holds the potential to be the biggest on the global food and agriculture canvas, according to a Corporate Catalyst India (CCI) survey. The food industry in India comprises food production and food-related processing industries. The food processing industry is one of the largest in India â&#x20AC;&#x201C; it is ranked ďŹ fth in terms of production, consumption, export and expected growth. The Agriculture sector is the base for most of the food processing industry and this sector has touched a growth rate of 4.4 per cent in 2012-13. The food grain production at the India level is close to 245 Million MT. The Food Processing industry is growing at a 13% growth rate and for the Indian economy the growth of this industry is crucial for the overall growth of the Nation. 2.Food processing overview: Indian Scenario India annually produces 205 million tons of fruits and vegetables and

is the second largest country in farm production in the world but unfortunately the processing percentage is poor - only 4.6 %. In contrast, countries like the USA (65%), China (23%) and Philippines (78%) are far ahead of India in reducing wastage and enhancing the value addition and shelf life of farm products. This is an alarming signal for India as a large volume of the agricultural produce is wasted. About 35% of the fruits and vegetables are wasted annually due to poor storage facilities, amounting to a revenue loss of Rs. 500 billion. Also, 80% of the vegetables rot due to high water content and lack of processing facilities, resulting in a revenue loss of Rs. 125 billion. The Agriculture sector is vital for any nation and in India it is the principal source of livelihood for more than 58 per cent of the population and I consider the Food Processing sector to be just an extension of the Agriculture sector. The progress of each sector is dependent on the other. In developed countries,

Vol. 10 Issue 02 December 2014

FPI because of a developed Food Processing sector, a demand is created in the Agriculture sector. India will follow the same path. 2.1 Indian Food Industry Processed food in terms of value is expected to increase from 43 per cent to 50 per cent of total food production. The food processing industry is of enormous signiďŹ cance for India's development as it has efďŹ ciently and effectively linked the nation's economy, industry and agriculture. The linking of these three pillars has synergized the development process and promoted the growth of the nation to a great extent.

The Food Processing industry is one of the largest industries operating in India and is divided into several segments. The Food Processing industry operates across various segments that include: Fruits and vegetables Meat and poultry Dairy Marine products Grains and consumer foods (including packaged food, beverages and packaged drinking water) The fruits and vegetables processing industry is highly decentralized, and a large number of units are in the cottage, household and small-scale sectors, having small capacities of up to 250 tons

per annum. Since 2000, the Food Processing industry has seen a large growth in ready-to-serve beverages, fruit juices and pulps, dehydrated and frozen fruits and vegetable products, pickles, mushrooms and ready-mix vegetables. The small-scale units engaged in these segments of processing are exportoriented. Value addition of food products is expected to increase from 8 per cent to 35 per cent by 2025. Thus this sector is very important for overall growth of India since this sector takes care of farmers and ensures employment for skilled and unskilled /educated and noneducated labor. I see a huge potential in post-harvest treatment for fruits and vegetables in the coming days. Due to changes in lifestyle and urbanization, the demand for highquality fruits and vegetable is increasing. Even the demand for ready-to-use fruits and vegetable is increasing. The scope for cut vegetable is quite high due to the growing demand. Apart from traditional food processing viz. Mango, Banana, Grapes, Sugarcane, Dairy, etc. this sector needs value addition which will give a good payback to the farmers and will also ensure inclusive growth (higher returns to all stakeholders). India is witnessing a paradigm shift and the following sectors have a huge potential to fuel the growth of food processing in India. These will be the game-changers: Nutraceutical industry Wine processing Pre/Pro biotic Industry Packaged water industry Ready to eat industry Traditional foods processing Cut fruit and Vegetable industry Post-harvest treatment for fruits Export â&#x20AC;&#x201C;Brand India Food additives Food equipment manufacturing 3. Challenges For overall growth of the food processing industry, along with raw material, there are many other inputs which are required. The biggest challenge is that the food processing sector is dominated by unorganized players who contribute to 80% of the food processing industry (by volume) unlike other sectors viz. Pharma, Automobile and IT where over

Vol. 10 Issue 02 December 2014

FPI 90% of the sector is under organized players. There is a conversion of unorganized to organized sectors but we still need to cross quite a distance. In India 85% of the GSDP comes from service and industry sectors and only 15% is from the Agriculture and Food sector, but 55% of the population is dependent on Agriculture/food sector. If you look at this statistic minutely, 55% sector contributes only 15% in GSDP value and this is mainly due to the lack of processing non value addition. We need to change this scenario and money should go back to the farmers as per their value addition and thus Agriculture/food sector should equally contribute to its size ( 1 : 1 ratio) in GSDP. This is possible if we focus properly like many developed countries who have a higher ratio. This will fulﬁll our objective of 'Sabka Sath, Sabka Vikas”. The main challenges in the Food Processing industry are – Unavailability of processable quality and quantity of fruits and vegetables and raw material Low productivity of Agri products Low land holding per farmer Poor processing conversion Low technology base/low automation Labor-intensive operations High seasonality : Input availability High operating cost due to small scale operations These challenges can be overcome by proper planning and focus given to this sector. 4.Market Potential The Food Processing sector is called as Rising-Sun industry due to its inherent potential. In India today Food Processing sector has its own advantages like – Stable central government – Decision power Separate food processing ministry with able leadership and clear focus Good urbanization – due to many reason – market is expanding Good consumer purchasing power : Middle class segment is increasing Good Market potential – Domestic – husband /wife working need processed food New Food safety regulations – Nutraceutical industry is part of 'Food' Good in Agri production Good infrastructure/investments Good in-ﬂow of FDI in the sector Let's see how much potential exists in

India for the Food Processing market. In India we have a population of 120 Crore. Considering 4 members per family - we have a 30 Crore family base in India. Let's consider each family spending Rs 2500 on food expenses (which includes milk, oil, grains, vegetables, fruits, etc.). Thus an amount of Rs. 75,000 crore/month is spent by India. Which means we spend around Rs 9,00,000 Crore per year on Food consumption. This is the food market potential in India and these numbers are on basic needs, not included other high valued items. Over all the demand would grow only. Now the question is what part of this market is catered to by the organized sector, retail sector or non-organized sector. Are we using our resources fully to cater to this market? Do we have the facility to fulﬁll this demand? Or are we dependent on import (other countries) ? 5.Some Ideas 5.1Focus on Market – Build quality brands at low-cost product development. Today India is a big village. Recently the government has announced removal of the APMC Act and this will certainly fuel the trade from farmers to consumers. For export we need to work on supply qualities. Government and Industry should focus on Market needs and try to meet the demand rather than putting our own production in the Market with low realization. The focus should be Market backward rather than production forward. If the Market needs seedless Guavas or Oranges we should supply the same (I know it's a long process and will take

Vol. 10 Issue 02 December 2014

time, but the Government, Agriculture universities and companies should focus on this) rather than supplying normal Guavas and fetching a lesser price. The best example is of Punjabi dhabas – just because of market demand, today we see the success of the dhaba model all across India without any intervention from the government. Similarly, a product like paneer makhani has travelled from Punjab to South India. Idlis have travelled from the south to the north. Dhokla has travelled from Gujarat to Kolkatta and Rasagulla has travelled from West Bengal to all over India. But we need standardization of the processes and some help in developing products and brands. There are some success stories like Grapes (seeded to seedless) and Banana (normal to tissue culture) which have changed the complete economics of the trade. We should follow the same route for other fruits and vegetable. In short the Mantra is 'Meet the Market demand'. 5 . 2 F o c u s o n Tr a d i t i o n a l F o o d processing and Technology India has a great food map which is spread all across India. Every state has its own food culture and we need to cultivate and nurture this culture to maintain our long heritage. Why not invest R&D efforts to make the traditional food sector more modern with high science? Academia should be given priorities on traditional food R&D and some good innovative techniques should cater to the market. There are many market problems which can be solved by R&D efforts. There are over 300 Food Technology colleges and over 50 Food/Agri universities. They should fuel innovation in the area of Traditional food

FPI and bring some economical solutions so that the common man / housewife will get the beneﬁt of such innovation. Some example where small ideas can bring a big impact – Roti-making technology : Roti in prepacked condition with high quality /long shelf life/low prize and hygiene Idli / Dosa batter which can stay for 7 days at room temperature Dehydration technology at very low cost - This will make 'Ready to serve' p r o d u c t s a t l o w c o s t Freezing/Cold storage technology at low cost – This will change the face of farming. Focus on food equipment design and R&D – Today we have to import most of the equipment. Even for Samosa making we import the technology from abroad. Use of traditional packaging materials to balance the environment impact – 5.3 Skill development through Food Technology colleges and Universities As mentioned earlier, we have over 300 Food technology / Food science colleges all across India. Can we use these colleges as skill development centers? Some basic curriculum can be made by the ministry and we can design training models which will be executed depending on the area and subject. The target audience would be women and unemployed youth. These colleges can be registered with the ministry directly and depending on the training, money would be reimbursed to the center. 5.4 Focus on agriculture universities to develop high yielding varieties and processable varieties Today India is No. 1 in production in many agricultural commodities still our average yield per acre is the lowest in the world. There are many reasons for this and one of the reasons is inappropriate varieties. There should be a focus on high-yielding varieties and though it is a long term project, it should start with a deﬁnite objective and it can be made successful through the PPP model. 5.5 Use of Self-help group infrastructure to meet the local demand Today our main objective is to increase the processing percentages and it can be achieved by setting up low-cost processing centers all across India through use of the vast infrastructure of Self-help groups. Even if we pack

grain/fruits/vegetables in these centers in a kind of 'Amma model' of Tamilnadu, it can be a huge success. In countries like South Korea, the entire electronic industry has been spread across self-help groups. Big industries outsource the routine/low technology jobs to different households and literally every house becomes part of the industry. If it can happen for high-tech sectors like electronics, why not for Food processing? Lijjat / Amul model is based on the same principle. We should tap the opportunities of big retailers and let them work with self-help groups on win-win terms.

a r e a s . We s h o u l d r e c o g n i z e t h e nutraceutical industry as a special industry under food processing and this will reduce the burden of the healthcare budget. India has a 5000 years old tradition of Ayurvedic ingredients / botanicals which can be tapped for better use but what we need is low-cost models with effective results. 5.8 Special focus on Post-harvest technology with practical solutions Post-harvest is a typical topic on the radar of the ministry for the last 10 years, but what we need again is low-cost technologies and easy practical solutions. E.g. today Calcium Carbide is banned for Mangoes, but we should have technology as simple as calcium carbide to offer to farmers or traders so they also can use the same for fruit ripening. The same is true for cold storage and degreening chambers. We need a local model of success and it could be a nonelectricity dependent model. Recently someone has innovated a 'Matka Fridge' to help farmers in Punjab keep their produce for 4-5 days in this structure without addition of extra cost. We need focus on such low-cost post-harvest solutions so farmers can use it effectively.

5.6 Standardization of curriculum of all food technology colleges Today we have various food technology courses under different names viz. Food tech / Food science / Food nutrition / Food Engineering / Food Bio, etc. Just as in the case of Pharma / Medical / Engineering there is a single standard syllabus, can we create it for Food Technology? The syllabus should focus on industry needs and entrepreneurship development. We could even have various NIFTEM branches in different states. We can bring in IT support and not only the syllabus but activities on research can be tracked with the help of modern IT tools. Research should be focused again on Market demand / Industry demand / Government requirement rather than other reasons. There should not be repetition of research by various universities and a universal research data bank should be available for common reference. We need to include the concept of food safety / Codex in the syllabus.

5.9 Link food processing with tourism industry to attract foreign visitors. Every state has some special food products. Today Kerala has developed 'Ayurveda spa' and it is successful all across India and has attracted good tourism. Can we develop similar ideas for food? We can link food tourism with the help of Food and Nutrition colleges and again the focus here would be on quality and safety and authenticity.

5.7 Special focus on Nutraceutical industry to reduce the burden on the Healthcare industry It is said that 'Anna he Purna Brahma'. Today food can be the best of healthcare remedies and we can let medicine be the ' s i c k c a r e ' i n d u s t r y. P r e v e n t i v e healthcare is a big industry and Food could be the best solution through Nutraceutical and Ayu-ceutical solutions. Food processing ministry can encourage this sector to bring in some low-cost nutraceutical solutions to take care of some basic healthcare problems like in the areas of Heart / Sugar / Eye care / Kidney care, etc. There are enough bioactive agents which are known in these

5.10 Brand India – Quality We need to make the food processing sector very attractive and of excellent quality to develop brand India. Today the Ministry of food processing is basically focusing on fruit and vegetable processing sectors only. We need to cover all the aspects of food under the umbrella of food processing ministry and need to make a strong 'Brand India' for the international market. Already Apeda has successfully done it for mangoes / grapes. We can do it for processed food. We also need to make careers in Food Processing more attractive & lucrative and there should be a good talent pool coming into this

Vol. 10 Issue 02 December 2014

FPI sector. 5.11 Encourage Big food industry to invest in India There are various challenges for food processing industry and many companies which are already in the sector helping Indian economy to generate employment and tax collection. We need to give special treatment to these industries and some relaxation in tax and subsidies. Government should encourage investment in food processing sector and some schemes should be launch to attract new investment. Big companies (Multinational/domestic) should get conﬁdence and get freedom to work in existing regulator

the growth of the Indian food industry in a holistic way. I have not touched upon other aspects like taxation / land reforms / subsidies which are anyway part of existing agendas. I am conﬁdent that with a focused approach we can achieve 20% growth year on year in the food processing industry in the coming 5 years and by 2018 India will reach a number of 25% processing with GSDP contribution of 40 % from Agri/Food sector. This will deﬁnitely bring our slogan true – “Bahuja sukhaya, bahujan hitai' . Key references 1. http://mofpi.nic.in/ (Ministry of Food Processing Industries, Govt. of India)

y framework. Many states have started single window system to tackle the industry issues and same can be done at central level.

2. http://www.midcindia.org/ (MIDC website for all investment related information) 3 . h t t p : / / n h b . g o v. i n / a n d http://agricoop.nic.in/ (for all horti and agri production information) 4. http://msamb.com/ (for agrimarketing related information) 5. http://mahavat.gov.in/ (for taxation r e l a t e d i n f o r m a t i o n ) 6 . h t t p : / / w w w. m a h a a g r i . g o v. i n / (Department of Agriculture, M a h a r a s h t r a ) 7. http://mswarehousing.com/ and http://fciweb.nic.in/ and

6. Conclusion Today the Indian food industry is a natural choice for foreign direct investment. Special sectors like Nutraceuticals / Post-harvest sector / Traditional food / Convenience food can bring good value addition to farmers, processors and consumers. This is best for overall growth of the economy. I have given some suggestions which could fuel

Vol. 10 Issue 02 December 2014

http://cewacor.nic.in/ (for warehousing related information)

or the growth and development of

agribusiness and food processing industry in Odisha,

the state government plans to formulate ' Odisha Agribusiness and Food Processing Policy'. In a draft Vision 2025 document prepared on food processing in Odisha, the government has stated that the proposed policy will help promote/energise the sector in the state. The ﬁscal beneﬁts proposed in the draft

n order to encourage food processing sector in the country, Ministry of Food Processing Industries had launched a Centrally Sponsored Scheme - National Mission on Food Processing (NMFP) during 12th Five Year Plan. Under the Scheme for Technology Upgradation/ Establishment/ Modernization of Food Processing Industries of NMFP, ﬁnancial assistance is provided to the entrepreneurs to set up food processing units in the country.

vision document are down ward revision of VAT (value added tax) imposed on agricultural and processed food items to make the sector competitive, abolition of entry tax in line with High Court rulings of Kerala, Rajasthan and others states, lowering per unit power cost on supplies to agribusiness and food processing establishments like cold storages, processing units by amending state electricity regulations among others. The ofﬁce of the state mission director of National Mission on Food Processing, which has prepared the draft paper, has proposed for declaration of agribusiness and food processing industry as a priority sector. For achieving the target, both short term and medium to long term interventions have been suggested in the draft paper. Among others, creation of directorate of agribusiness and food processing is identiﬁed as one of the major interventions of the state government. The proposed directorate, to be created

Assistance is also available for modernization, up-gradation and expansion of the existing food processing industries. Under the scheme, financial assistance in the form of grant-in-aid to entrepreneurs is extended @ 25% of the cost of Plant & Machinery and Technical Civil Works subject to a maximum of Rs. 50.00 lakhs in general areas & @33.33% subject to a maximum of Rs. 75.00 lakhs in difficult areas and 50% subject to maximum of Rs. 100.00 lakhs in North Eastern States including Sikkim. The Ministry is also implementing the Central Sector Scheme of Mega Food Parks to provide modern infrastructure for food processing units in the country. The pattern of assistance is 50% of the eligible project cost in general areas and 75% in difficult areas subject to a maximum of Rs.50.00 crore per project. On an average, an investment of Rs. 120

Vol. 10 Issue 02 December 2014

within the industries department, will act as a single window for catalysing the agribusiness and food processing industry in the state. The directorate will be headed by an ofﬁcer in the rank of director who will be assisted by technical experts and ofﬁcials drawn from the agriculture marketing directorate and MSME (micro small and medium enterprises) or industry departments to ensure development of the sector in Odisha. It may be noted that a dedicated policy for food processing industries called “Odisha Food Processing Policy 2013” is already in place. The document envisions a well developed agribusiness infrastructure with market linkages to reduce the high levels of wastages, which are currently pegged in the range of 30-35 per cent of the production. The mission director has sought views of the stakeholders of the sector for inclusion in draft document.

crore is made in a Mega Food Park project which creates infrastructure for setting up of 30-35 processing units. The Government has so far approved 42 Mega Food Parks projects, out of which 25 projects are under various stages of implementation. The proposal for setting up of Mega Food Parks are invited by the Ministry through Expression of Interest (EOI) and projects are selected on merit, based on the parameters laid down in the Scheme guidelines. State-wise targets for setting up Mega Food Parks are not ﬁxed. Ministry had invited Expression of Interest on 10.02.2014 for selection of Mega Food Parks projects against the vacant slots. The last date of submission of EOI was extended to 31.07.2014. In response to this EOI, a total 72 proposals have been received which are being appraised in the Ministry.

Bühler is a specialist and technology partner for plant and equipment and related services for processing basic foods and manufacturing advanced materials. The Group is a global market leader in the supply of ﬂour produc on plants, pasta and chocolate produc on lines, animal feed manufacturing installa ons, and aluminum die cas ng systems. The core technologies of the Group are in the ﬁeld of mechanical and thermal process engineering. With its exper se and over 150 years of experience, Bühler me and again rolls out unique and innova ve solu ons for its customers, helping them achieve success in the marketplace. Over the decades, Bühler has come to be acknowledged as a reliable partner, thanks to its dis nct commitment to quality and its global presence. In an intense interview with Béatrice Conde-Pe t, senior expert food science and technology, cooperate technology, Buhler AG, our Editor, Firoz H Naqvi came to know about the connec on that Buhler has with Indian Food processing technology and what future plan the eminent company has for the global and Indian shore. Vol. 10 Issue 02 December 2014

Excerpts from the interview: Can you brieﬂy tell us about Buhler's future plan for the global food industry? Our plan is really to act as enabler, to provide the technology needed, to deliver safe, healthy and affordable food within the limits of our planets. At the end of the day the solutions are tangible solution but safety of food, affordability and good nutrition is the vision that guides us.

purpose technology which leads to affordable products. It's not transferring the top notch technology which is expensive and for the premium market. But still we have developed it in a solid way that gives healthy, safe and economical products. Being one of the largest food processer and having best R&D set-up in India;

Do have any special plans for the Indian Sub continents, as their need, requirement and demand are very different from the developed world? Well I can give you several examples in this issue; we at Buhler constantly work on the fact that how we can meet the local culture and taste, which indeed is

how much has it helped you to understand the need of other countries with similar commodities like spices, pulses, etc? Absolutely it has helped, we learn a lot by doing R&D from one country to

different in India. Like we have developed our expertise in pulse processing technology because this is very important local product in India and we are technology leaders in this field. Atta flour is the other products for which we have developed dedicated solutions; we with help of our partners in Switzerland and deep research we tried to understand the use of Atta flour and the exclusive chapatti made out of it. Only with this understanding we were able to develop dedicated milling technology to produce Atta flour. Then coming to snacks, Indian snacks are different from western snacks. For Indian snack we have developed fit for

another. Like, India is the biggest processor of spices, so we found solution by merging the both thing…spices coming from India and food safety from our side. The knowledge of inactivation, which is how to inactivate harmful microorganism in spices, is our expertise that we combine with the Indian spices. Also the special Atta mill that we developed in India can be used as a solution in other countries, like Africa. Also it is a useful example for western countries that consume highly refined flour, so they can go back to the root and consume whole wheat flour. So you can see we have achieved certain things in India that we are far from

Vol. 10 Issue 02 December 2014

achieving in our European front or the first world. Technical up gradation happens all the time, how does your company deal with the issue and upgrade you existing customers? The most important part of our philosophy is to serve our customers along the whole life cycle of the equipment. And even if we come up with innovation, it does not mean we neglect our older customer. A lot of innovation can also be retrofitted into existing solution. Services is very important in whole line, and our commitment go far beyond selling , it's based on serving the customer the whole life cycle of the equipments. India is a power house of human resources, has Buhler recruited Indian workforce and has it gained from it? We have definitely taken advantage of the resources, but it is mainly in India

working for the Indian market. Of course we have a very close exchange with our colleagues around the globe, thus India is also serving much part of the Asian marketing general and also the African market. So we have colleagues who are global players and we brought into India the apprenticeship model to train people. So we are trying to combine the best of the two worlds.

TRADE

ndia and the US have resolved their disagreements on food security issues, paving the way for the implementation of a global trade pact. The deal to simplify trade procedures was done at a World Trade Organization (WTO) meeting summit in Bali in Indonesia last year. But India had blocked implementation of that agreement. It wanted assurances that its food security programme would not be challenged under the WTO's rules. India's concern was that complaints based on rules limiting farm subsidies might undermine its spending on food stockpiles intended to ensure that the poor have enough to eat. India sees food subsidies as a crucial way to help the poor. It does this to both protect farmers, but also provide affordable food to many. Food security programmes are covered by a so-called "peace clause" in which

countries agreed to refrain for making such challenges until 2017. The US has now agreed to extend that commitment, in effect indeﬁnitely. This bilateral agreement between the US and India still has to be endorsed by the full WTO membership, and it's likely to be discussed in the Organization's General Council meeting this month. The breakthrough stems from a bilateral summit in September when Prime Minister Narendra Modi visited the US. Analysts have estimated that that trade deal could add $1tn (£630bn) to the world economy, by reducing the costs of conducting trade by for example simplifying customs procedures. Delhi and Washington have agreed that India's food security programmes would not be challenged under WTO rules "until a permanent solution regarding this issue has been agreed and adopted".

Vol. 10 Issue 02 December 2014

India Comes Around India and the U.S. had successfully resolved their differences relating to the issue of public stockholding for food security purposes in the WTO in a manner that addressed the Indian concerns. This ended the impasse at the WTO and also will open the way for implementation of the Trade Facilitation Agreement. The breakthrough in negotiations means that the WTO's first multilateral agreement since its inception 20 years ago will now go before the organization's 160 members for full ratification, likely at its next General Council meeting. India agreed to drop its opposition after U.S. and Indian trade officials agreed to a mechanism that would prevent WTO members from challenging the legality of India's domestic food security programs until a permanent solution is

Vol. 10 Issue 02 December 2014

TRADE adopted. WTO members previously agreed to streamlined TFA rules at the 2013 ministerial meeting in Bali, Indonesia, as a means to expedite the transportation, release and clearance of international goods among member countries. WTO members also agreed in Bali to permit India and other developing countries to stockpile their domestic food supplies without violating international trade rules until a nal solution could be negotiated at the organization's 2017 conference. Though India initially supported trade facilitation changes, on July 31 it opposed a WTO protocol agreement to advance the TFA until members agreed to accept its domestic food security programs. India said it feared that without a permanent solution it would be vulnerable to challenges from WTO members who say India's food stockholding programs exceed its agricultural subsidy limits. Plurilateral Threat India's decision to drop its demand for a permanent solution to the food security issue in favor of a temporary peace clause stems from a recognition that the multilateral trading system is “too valuable to lose. In recent weeks, the U.S. and the European Union had actively discussed ways to plurilaterally implement trade facilitation rules among those members that are willing to do so and then apply them to all other members on a mostfavored-nation basis. Such an approach would have further isolated India within the WTO and would have failed to address the remaining elements of the organization's post-Bali agenda. While there was much media debate and concerns expressed regarding the impact of India's stand in the WTO, it has undeniably resonated across the world, and many countries saw merit in what India was asking for. India was not alone or isolated. Others were simply not speaking up. What was the issue? It appeared to be a done deal. Last December in Bali, the 159 member c o u n t r i e s o f t h e Wo r l d T r a d e

Organization (WTO) signed off on the trade facilitation agreement (TFA). While not garnering much media attention, it should have. The accord was easily the largest multilateral trade agreement. The TFA sought to reduce red tape and relax customs rules, thus reducing frictions in international trade. A study by the Washington-based Peterson Institute for International Economics estimated that the accord could add as much as $1 trillion to the global economy and create 21 million jobs. According to the Bali timetable, the TFA would take effect in mid-2015 after what WTO officials expected would be pro forma approval of the agreement hashed out by negotiators. Then India backed out of the deal. Why would a supposedly businessfriendly leader, who was elected in an electoral landslide on a platform promising economic reform, pull the plug? Narendra Modi, India's then new prime minister, refused to sign the deal until the WTO changes its rules to allow governments to expand food subsidies for the poor. Some aspects of India's food-security program, like stockpiling grain, currently violated WTO rules. Agriculture employs nearly half of India's workforce, and more than 70 percent of India's poor live in rural areas. The rural poor constitute an important vote base for any government in India. Domestic political calculations may well have contributed to Modi's decision to hold the TFA hostage to Indian demands on the food-subsidy issue. Understanding India's sensitivities to reforms involving the agricultural sector, WTO members offered India a four-year “peace clause” to protect it from WTO sanctions while the country transitioned to a new system. But four years from now, India will be getting ready to go to the polls again, meaning the BJP could be blamed for not protecting the Indian farmer when it had the chance to do so. With the July 31 deadline to finalize the accord, the Modi government had its first real opportunity to reform or eliminate a subsidy program that was riddled with corruption. Moreover, economists had offered alternatives to feeding the poor, including food stamps and cash transfers. Instead, the prime minister, at a time when his political capital may be at

Vol. 10 Issue 02 December 2014

its highest, chose to protect the status quo. 'New Delhis obstructionism at the WTO almost certainly did dampen foreigninvestor optimism about the new government's disposition toward business, and thereby the overall prospects of India's economy. Many had hoped that with Modi's rise to power, the country would start to break its protectionist, statist habits. According to the World Bank, India's exports-to-GDP ratio was ranked 92nd out of 112 countries in 2013. Looking longer term, the failure of the WTO to implement an effective trade and investment agreement in over a generation is likely to breathe some life back into regional trade accords like the Tr a n s - P a c i ﬁ c P a r t n e r s h i p a n d Transatlantic Trade and Investment Partnership. While India is part of the ASEAN-centric Regional Comprehensive Economic Partnership (RCEP), most developing countries do not have the same opportunity. Perhaps that is one of the reasons they had agreed to go along with the TFA despite their reservations—to keep the multilateral trade regime moving forward. India's WTO antics did not overshadow 'PM Modis visit to Washington in September. The two sides had a broad agenda to cover, including counterterrorism, defense and security cooperation, the challenge of China's assertiveness along its borders, Afghanistan's future and energy issues, to name a few. And to be fair, the new government has taken some tentative steps on the economy, such as lifting FDI caps in the defense sector to 49 percent and banning the Planning Commission, a symbol of a centrally controlled economy. In announcing the closing of the Planning Commission, Modi pointed out that the federal government was not the main driver of economic growth and that state governments needed to be free to innovate. As Chief Minister of Gujarat, Modi transformed it into one of India's most investor-friendly states. That track record gives conﬁdence that he will move in this direction with his national agenda.

rowing interest by consumers to point and click their way through nearly all aspects of daily life has fueled the Internet economy to develop services and sell products online even in areas that were once the sole domain of traditional businesses, such as grocery stores and pharmacies. Businesses that sell consumer products online have been coined as e-tailers" and as e-grocers" in the case of online grocery retailers. Some of the reasons why an increasing number of consumers buy groceries online are common to all Internet purchases, including better prices, larger selection, convenience, and time savings. Home delivery of items purchased online is appealing to those for whom going out to Shop is difﬁcult for various reasons, such as physical disability, the need to care for small children, the lack of adequate or convenient transportation, and/or a busy lifestyle. Buying groceries and other products online unchains consumers from physically driving to and shopping in traditional stores. . The value proposition of e-grocers is to become a single-source solution for the busy consumer today. E-grocers provide information as well as products and services. For example, on Net Grocer's website customers can preload a recipe

onto the web page and with a simple click place an order for the ingredients of that recipe. Customization of weekly shopping lists and lists of frequently ordered products as well as personalized shopping aisles are additional benefits of shopping online versus in traditional stores. Storing weekly orders on the website makes repeat orders simple. E commerce in India Over the last two decades, rising internet and mobile phone penetration has changed the way we communicate and do business. E-commerce is relatively a novel concept. It is, at present, heavily leaning on the internet and mobile phone revolution to fundamentally alter the way businesses reach their customers. While in countries such as the US and China, e-commerce has taken significant strides to achieve sales of over 150 billion USD in revenue, the industry in India's e-Commerce market will reach $6 billion in 2015 a 70 percent increase over 2014 revenue of $3.5 billion according to Gartner, Inc. Digital commerce is at a nascent stage in India. However, India is one of the fastest-growing e-commerce markets in Asia -Pacific and India represents a $3.5 billion market, growing at approximately 60-70 percent every year. It represents less than 4 percent of the total retail market. B2C e-commerce leads the market in India, while B2B is

Vol. 10 Issue 02 December 2014

limited to organizations that drive online channels to integrate with their partners and distributors. Mobile commerce is ﬁnding increasing traction in mobile shopping. Marketplaces, consumer product goods, and food and beverages companies have started investing in mobile commerce. However less than 5 percent of total digital commerce happens through mobile. Mobile commerce will help organization skip the desktop wave with increasing penetration of affordable smart devices with connectivity and a rapidly growing ecosystem to engage customers on mobile. Thirty percent of trafﬁc for e-commerce sites come from mobile and tablets. The digital commerce platform market is maturing; incumbent vendors are investing in building out their commerce platforms, and those in adjacent areas, such as search, order management and marketing — both through organic development and acquisition. Vendors are increasingly focused on execution and winning new customers, sometimes at the expense of articulating future vision. Merger and acquisition activity is increasing, resulting in fewer digital commerce platform options in the market, but also serving to extend the commerce platforms of the established vendors. Digital companies will expand investments in personalization, digital marketing, Web analytics and big data in order to stay competitive. India has approximately 200 million users on social networks, and it is an important channel to understand and engage with customers. Digital business means "competition"; reaching new markets that will require working with competitors that offer marketplace sites and access to new customers, payment services to acquire global reach, or hosting services to achieve scalability and availability. No single deployment or licensing

ECOM model will dominate the digital commerce market, and in Indian organizations will look at SaaS or open source platform- based digital commerce till the market matures and digital commerce revenue stabilize. Limited internet penetration, low digital commerce volume, multiple payment models (e.g., cash on delivery, credit card and wire transfers), logistics and fulfillment challenges, higher return rates and low average order value is putting pressure on the profitability and viability of B2C eCommerce businesses. The B2B model is leveraged to drive efficiency in the supply chain. The biggest challenge is getting the business digital commerce strategy right and adequate investments in people, process and technology to engage with customers across channels, which has been ignored by Indian enterprises so far. Industry studies indicate that online travel dominates the e-commerce industry with an estimated 70% of the market share. However, e-retail in both its forms; online retail and market place, has become the fastest-growing segment, increasing its share from 10% in 2009 to an estimated 18% in 2014. Calculations based on industry benchmarks estimate that the number of parcel check-outs in e-commerce portals exceeded 100 million in 2014. However, this share represents a miniscule proportion (less than 1%) of India's total retail market, but is poised for continued growth in the coming years. If this robust growth continues over the next few years, the size of the e-retail industry is poised to be 10 to 20 billion USD by 2017-2020. This growth is expected to be led by increased consumer-led purchases in durables and electronics, apparels and accessories, besides traditional products such as books and audio-visuals. Chief characteristics of the ecommerce market which impact the logistics models · Cash-on-delivery': India has been a vibrant cash economy where the consumer's purchasing behaviour involves an initial overall inspection of the product from different perspectives and paying subsequently. Further, customers in India do not extend much trust on the transit facilities for the delivery of the products. This has resulted in 'cash-on -delivery' (COD) as

a preferred payment option of majority of the Indian consumers buying online. ·

Consumers in India expect the return process to be seamless and convenient. However, with an expectation of return of the items purchased online, online shoppers have made available the option to return the purchased goods at the behest of the retailer. Retailers have considered this option of return to develop trust and conﬁdence which results in seamless subsequent purchases and positive word-of-mouth support.

potentially lead to word-of-mouth publicity, feedback and customer retention to the e-portal or website. An information network which shares updated information with respect to inventory status, demand schedules and forecasts, shipment schedules and promotion plans among all the stakeholders of the supply chain will form the backbone of an e-retailer. As e-commerce gains scale in the country, India's largest consumer packaged goods company by sales, Hindustan Unilever Ltd (HUL), is working with modern retailers like Kishore Biyani's Big Bazaar and etailers like Amazon and Flipkart to sell its goods through their digital networks. It is adopting a strategy similar to the one it used about a decade ago when modern retail was a relatively new phenomenon in India. Clothing, food and groceries, consumer durables, mobile phones and IT retailing form about 60% of the organized retail market.

Free and quick home delivery is another characteristic of the ecommerce industry in India.

E-retailers offer free delivery of the products within a promised timeline. Though this may be unsustainable in the long run but e-retailers have to offer the same convenience of free and quick shipping to compete with other retailers.

Reaching the customer: Going beyond the traditional definition The essence of e-retailing is in its ability to transcend physical boundaries and reach customers in a manner different from the traditional brick-and- mortar stores, to their very doorstep. However, the base of the e-retailing model is technology and logistical solutions that facilitates the customer acquisition and the final 'reach' process. E-commerce further brings to the table vagaries in customer orders accompanied with difficult scenarios such as free delivery; order rescheduling, cancellation, returns and cash-on-delivery. Additionally, an expected minimized turn-around-time (TAT) which will

Vol. 10 Issue 02 December 2014

Organized retailers have a share of just 2.2% of the overall food and groceries market. Even in e-commerce, food and groceries retailing is, so far, not among the top ﬁve categories bought online. Still, food and beverage makers such as PepsiCo India Holdings Pvt. Ltd, Kellogg India Pvt. Ltd and HUL have started partnering with e-tailers. All large FMCG companies like HUL, Pepsi, Kellogg have started to look at digital advertising and selling online as their consumers are gravitating online in terms of seeking information ﬁrst and subsequently also buying online. FMCG is short for fast-moving consumer goods, a category that encompasses packaged foods and household and personal care products. First Indian Food & Beverage e-Store In its e-store, Amazon will host more than 100 varieties of gourmet products and beverages. Amazon will put in ''$2 billion as investment to expand Amazon Indias services and reach, in a hope that it will soon take over Flipkart- India's biggest online grosser. Amazon India is in talks with breakfast cereal maker Kellogg's and Nachos manufacturer, Cornitos to provide exclusively for Amazon. Amazon is all set to launch the delivery of packaged

ECOM foods and will not foray into delivering groceries yet, though many Amazon officials are hinting at it. Olympia Industries, a trusted and premium seller for Amazon is running a tight ship this festive season stocking up the new Coca Cola Zero and other products for the online retailer. Amazon India is the only e-commerce site to have introduced F&B in their estore. Flipkart has made it clear that they will not tread into groceries and automobiles any sooner. Well, delivery of groceries isn't really a new idea for Amazon which first started the delivery of F&B way back in 2007 in Seattle, their home town, expanding into California and has been enjoying their share of profits. The only reason one would prefer shopping online has to do with benefits. It could be reduced/discounted price of branded articles or other shopping benefits like coupons. With the delivery of F&B, certain few concerns will arise among customers, those are; · minimum order limit (many predict it may be Rs.200+) · Price of articles (MRP or discounted) · Delivery time (1-5hrs) · Delivery cost (Rs.50+) · Expiry date of articles ordered · If articles are damaged, will you get a refund? One should remember Amazon has been a successful online grocer since 2007. Amazon Fresh in the USA, offers people 3 hour delivery with a minimum order limit of $35 plus delivery charges. While placing orders on AmazonFresh.com you can easily filter items with regards to ingredients, brands, food allergies and much more, which makes choosing easy for many online buyers. AmazonFresh also introduced “Morning Delivery” wherein if you place an order for items such as eggs, sausages, juice etc at 10pm tonight, you are sure to receive the same before 7am the next morning. This seems to be working really well for Amazon which also doesn't hesitate in refunding your money if you seem disappointed with the products delivered. Amazon has easily adopted “No-questions-asked” refund which makes the online shopping experience hassle free. With these kind of policies, Amazon has to an extent created it's own place in US market where Peapod, Instacart, FreshDirect, Walmart To Go have made their mark.

Practice warehousing. With uniformity in taxation laws across the country, e-retailers are expected to move closer to consumption centers with an aim to address the duplicities in the logistics chain by removing the overlaps in form of delivery and sortation centers which are traditionally closer to the consumption centers. It will also result in uninterrupted access to the e-retailing market. In a recent case, a south Indian state had sent a tax notice to eretailers resulting in all eretailers withdrawing services in the particular state because of differing tax policies.

The Bangalorean startup Big Basket might have a little competition here. Though Big Basket delivers cut fruits and vegetables and does all your groceries, Amazon has not yet ventured into groceries. However with the existing players, it would be apt for Amazon to focus on 2tier and 3-tier cities where ﬁnding branded products is quite a tiring feat with fewer supermarkets selling the branded packaged foods. Another important thing Amazon should focus is on the price of these articles, if the overall price with the delivery is more than the supermarket, people won't mind a mild tan. Trends to watch out for

Vol. 10 Issue 02 December 2014

Evolution of logistics landscape in the country will be a very important factor in determining the course for the e-retailing industry. Logistics evolution will be necessary to realise the potential robust growth. Despite a huge potential, long-term profitability of the e-retailing industry in the country is still under question. After so many years of operations, all the major e-retailers are yet to start making profits. In the wake of wafer-thin margins and suboptimal infrastructure resulting in higher delivery cost, the long-term profitability still seems a distant possibility.

FDI in the inventory-led retail will also be an important factor in shaping up the future of the i n d u s t r y. I n t h e c u r r e n t scenario, global e-retailing giants like Rakuten and Alibaba are eyeing an entry into Indian e-retail market. Amazon has recently announced a 2 billion USD investment operating on marketplace model. FDI allowance could be a vital factor in attracting signiﬁcant investments resulting in better infrastructure and robust supply chains.

Evolution of taxation policies in the country will in a large way effect the way industries

The evolution of the existing logistics providers and more players entering the 3PL domain will result in realization of the huge potential of the e-retailing industry. Major 3PL players (such as FedEx, DHL, UPS, Gati, etc) will have to gear up to the increasing demands of the eretailing industry thereby helping in rationalization of delivery costs and provide much needed balance between using captive logistics network a n d 3 P L s . To t a k e t h e opportunity and help the eretailing industry to overcome infrastructural bottlenecks, resurrection of the Indian Postal Service can be a game changer. Collaborating the strong last-mile capability with technological up gradation will ease the dependence on the other modes of transportation. After taking a holistic view of the industry trends, ecommerce is poised for an exciting period of exploding growth in a period of three to ﬁve years. This is expected to lead to substantial investments in supporting infrastructure and innovative and game changing business models.

SPICES

pices are the pearls of developing countries. Spices are demand in the industrialized world, the export of these basic agricultural commodities by India can be relied upon to earn valuable foreign exchange. India, blessed with agro-climatic zones, exports spices to 120 countries. At present, production is around 3.2 million tones of different spices valued at approximately 4 billion US $, and holds a prominent position in world spice production. Her biggest trading partners are the US, Europe and Japan. India has the status of mere a commodity exporter in these markets, except for spice oils and oleoresins. Out of the 109 spices listed by the ISO, India produces as many as 75 in its various agro climatic regions. India accounts for about 45% (2, 50,000 tons) of the global spice exports, though exports constitute only some 8% of the estimated annual production .Over all, spices are grown in some 2.9 million hectares in the country. Spice production in India, as much of the agriculture in the country, is undertaken in millions of tiny holdings and determine the livelihood of large number of the rural population. The main challenge is for pepper, cardamom, coriander, ginger and turmeric. Among these spices pepper is facing major challenge in exporting in India. Keywords: Indian Spices, Agro-climatic, Export, Marketing, Indian Spice Board (ISB) I.

INTRODUCTION

A spice is a dried seed, fruit, root, bark, or vegetative substance primarily used for ďŹ&#x201A;avoring, coloring or

Vol. 10 Issue 02 December 2014

SPICES preserving food. Spices are distinguished from herbs, which are parts of leafy green plants also used for ﬂavoring or as garnish. Many spices have antimicrobial properties. A spice

may have an extra use, usually medicinal, religious ritual, cosmetics or perfume production, or as a vegetable. For turmeric roots example, are consumed as a vegetable and garlic as an antibiotic.

1. History of Indian Spices According to Fig 1: The history of Indian spice is categorized by three modules they are early period, middle age and early modern period.

1.1. Early Age The history and culture of Indian spices is probably as old as human civilization itself. The Vedas, the Bible and the

Quran are all replete with references direct or indirect - to Indian spices. The earliest literary record in India on spices is the Rig Veda (around 6000 BC), and the other three Vedas - Yajur, Sama and Atharva. Spices constitute an important group of agricultural commodities, which are virtually indispensable in the culinary art. They can be primarily defined as farm products used in various forms viz; fresh, ripe, dried, broken, powdered etc. which contributes aroma, taste, flavor, colour and pungency to food, rather than a lone food seasoning factor. Spices may be bark, buds, flowers, fruits, leaves, rhizomes, roots, seeds, stigmas and styles or the entire plant tops. 1.2. Middle Age Spices were among the most demanded and expensive products available in Europe in the Middle Ages, the most common being pepper, cinnamon , cumin, nutmeg, ginger and cloves. It has been estimated that around 1,000 tons of pepper and 1,000 tons of the other common spices were imported into Western Europe each year during the Late Middle Ages. The value of these goods was the equivalent of a yearly

I.MEDICINAL PROPERTIES OF INDIAN SPICES Allspice Stimulant, digestive, carminative, anodyne against rheumatism & neuralgia Aniseed mild expectorant, stimulating, carminative, diuretic, diaphoretic, in asthma powders, in veterinary medicine. Bay leaves (laurel) Stimulant in sprains, narcotic & in veterinary medicine Bishop's weed Digestive, antispasmodic, stimulant, carminative, expectorant. (Ajowan)Capsicum Digestive, thermogenic, carminative, stimulant, cardiotonic, antipyretic, serdorific, rubefacient & sialagogue. Cardamom (small) Stimulant, tonic, diuretic, carminative, digestive, expectorant, cardiotonic & used in s everal pharmaceutical preparations. Cardamom (large) Hypnotic, appetizer, astringent to bowels, tonic to heart and liver. Cambodge Astringent, digestive, thermogenic, constipating, used in haemorrhoids, diarrhea, & to control obesity. Cinnamon Astringent, diuretic, carminative, aphrodisiac, deodorant, expectorant, febrifuge, stomachic. Clove Refrigerant, ophthalmic, digestive, carminative, stomachic, stimulant, antispasmodic, antibacterial, expectorant, rubefacient, Aphrodisiac, appetizer, emollient. Coriander Carminative, diuretic, tonic, stimulant, stomachic, refrigerant, aphrodisiac, analgesic, anti-inflammatory Cumin Digestive, carminative, astringent, anti-inflammatory, constipating, diuretic, revulsive, galactogogue, uterine & nerve stimulant. Curry leaf Astringent, anthelmintic, febrifuge, stomachic, appetizing, carminative, constipating, anti inflammatory, antiseptic, used in skin diseases, in diarrhea, ulcers. Garlic Anticholestrol, antifungal, tonic, rubefacient, stimulant, thermogenic, aphrodisiac, used in cough, asthma, cardiopathy. Ginger Digestive, carminative, emollient, appetizer, stomachic, rubefacient, anodyne, expectorant, anthelmintic, stimulant. Mint Stimulant, stomachic, carminative, antiseptic, digestive, antispasmodic, contraceptive, used in vomiting, skin diseases, Amenorrhoea, dental caries. Mustard Thermogenic, anodyne, anti inflammatory, carminative, digestive, anthelmintic, sudorphic, tonic, emetic, used in vomiting, abdominal colic, dyspepsia, flatulence, skin diseases. Pepper Anthelmintic, carminative, alterant, antiperiodic, diuretic, digestive, emmenagogue, rubefacient, stimulant, stomachic, used infever, asthma, cough, dyspepsia, flatulence, arthritis. Tamarind Refrigerant, digestive, carminative, laxative, antiscerbutic, febrifuge, ophthalmic useful in gastropathy, datura poisoning, alcoholic intoxication, scabies, constipation. Turmeric Thermogenic, emollient, anodyne, anti inflammatory, vulnerary, depurative, antiseptic, appetizer, carminative, expectorant, stomachic, anthelmintic, stimulant, ophthalmic, tonic, used in skin diseases, dyspepsia, asthma, cough, bronchitis, inflammations,ulcers, worms, skin discolouration. Vanilla Aphrodisiac.

Vol. 10 Issue 02 December 2014

SPICES supply of grain for 1.5 million people. The most exclusive was saffron, used as much for its vivid yellow-red color as for its ﬂavor. I. RESEARCH METHODOLOGY India grows over 50 different varieties of spices. Total production is around 2.7 million tonnes. Of this, about 0.25 million tonnes (8-10 per cent) is exported to more than 150 countries. The Indian share of the world trade in spices is 45-50 per cent by volume (25 per cent in value terms). The world demand for organically produced foods is growing rapidly in developed countries like Europe, USA, Japan and Australia. The current estimated share of organic foods in these countries is approximately 1 to 1.5 per cent. Worldwide, food trends are changing with a marked health orientation. Since organic foods are free from chemical contaminants, the demand for these products should steadily increase in the new millennium. Organic cultivation is nothing new to India. The country has always been practising the traditional ways of using indigenous technologies and inputs mostly in line with modern organic farming principles. The per capita consumption of fertilizers and pesticides in India is far below that of developed countries. Which means, it is very easy for Indian farmers to embrase organic spice farming in its true sense. Export of organic spices from India has started in right earnest. The country at present

exports around 50 tonnes of different varieties of organic spices. Exports will get a significant boost in the coming years as more farmers switch to organic methods. Spices Board India has prepared a document on production of organic spices. It features the organic concepts, principles, basic standards, production guidelines, documentation, inspection and certification. The document has been published after approval by the National Standards Committee constituted by the members of IFOAM in India. Descriptive research has been undertaken to study the present status of spices production and marketing coupled with analysis of backward and forward linkages in spices trade and to explore the possible channels of spices marketing and exporting that could replace the existing channels and prove to be more successful. Both primary and secondary data was required for fulfilling the objectives of the study. Secondary data related to production was taken from Indian Spice board of India.Books, journals, magazines and internet are also used as a data source. Primary data and information is collected through personal interviews of farmers, Traders, Government officials, Hoteliers, transporters, Restaurant owners and Primary processors. Three districts of Idukki, Wayanadu, Malabar were studied as these districts have to favorable agro-climatic conditions for spice cultivation and are in close

Vol. 10 Issue 02 December 2014

proximity to the markets. The sample size was decided based on availability and constraints. No: of survey results Exporters: 15 Growers: 10 Traders = 3 Hoteliers = 5 Based on the Information collected with the help of questionnaire having both open and closed ended questions by interacting with farmers, exporters and other functionaries involved in marketing of spices in Kerala. The data collected were ﬁrst tabulated then analyzed and inferences drawn and interpreted on the basis of simple statistical tools (average, percentage, and graphical presentation). II. RESULTS AND DISCUSSIONS 4.1. Market Overview Based on ISB the current estimate of world Spice marketing in 1,68,700 tonnes is given in table 1 .This is against different developing countries a world production of 8.5 million tonnes valued at US $ 25 .From the given table it is clearly proven that India is the leading marketer of spices in the world. 4.2. India's Position in Spice Production and Exports India is the largest producer, consumer and exporter of spices, with a 46 per cent share by volume and 23 per cent share by value, in the world market. The Indian

Vol. 10 Issue 02 December 2014

SPICES spice export basket consists of around 50 spices in whole form and more than 80 products in value added form. However, a few spices and value added forms constitute a major segment of the country's total export earnings. India accounts for 25-30 per cent of world's pepper production, 35 per cent of ginger and about 90 per cent of turmeric production. Among the Indian Federal states, Kerala tops in pepper (96 per cent), Cardamom (53 per cent), Ginger

4.3. Marketing Difﬁculties  Low productivity in the Spice sector is one of the serious problems facing the Indian Spice industry. Poor product quality at farm level is another problem hindering reasonable price realization by the producer. Insufﬁciency of Legal Provisions Inadequate Surplus for Exports

Home of Spices". Although there is tremendous importance of spices, it is rather unfortunate that the sector has not achieved the required level development because of the problems in the marketing, supply chain, exports, pre and post-harvesting activities. Also exporters overseas are struggling. On the one hand they have to deal with hundreds of small scale farmers who want a good price for their produce. On the other hand, exporters need to deliver products

(25 per cent) production in the country. Andhra Pradesh leads in Chilly and Turmeric production in the country with 49 per cent and 57 per cent. In coriander, cumin and fenugreek production in the country, Rajasthan emerges as the largest producer with 63 per cent, 56 per cent and 87 per cent of domestic production. Within the duration of 2008-09 to 20112012, India's spice exports increased marginally by 1.20 per cent in terms of volume but export earnings in rupee terms registered an impressive 45.72 per cent growth reﬂecting marked value addition. In US $, the growth in earnings was 13.40 percent (Fig 2).

 Insufﬁcient Quantities of Quality Spices II. CONCLUSIONS The demand for spices and its products are ever increasing both in the internal and external markets. India has a worldwide reputation as the only country which produces almost all kinds of spices and it is through these spices exports the country earns the much needed foreign exchange over a long period of time. India is the largest producer as well as the consumer of the spices in the world. Several kinds of spices are grown in India since time immemorial, it is because of this he country is known to the world as "The

that comply with quality requirements and increasingly with social and environmental standards of volatile markets. This requires costly quality management systems and training of farmers. A targeted effort is needed to include poorer households in value chains: organizational development, technical upgrading, management skills and access to ﬁnancing are all required.

Vol. 10 Issue 02 December 2014

CHOCOLATE

ondelez International Inc. knows no one likes to open a melted chocolate bar, all gooey and messy and impossible to eat. As the $35 billion snack-food giant pushes deeper into India, it is encountering some unique challenges. Chief among them: how to keep its line of best-selling chocolate bars from melting in a hot climate where many stores don't have air conditioning and some lack reliable electricity. To build on its 70 percent market share, the Deerﬁeld-based company did what any resourceful outﬁt would: It innovated, developing small, transparent coolers

that consume little energy and shelf space. The so-called visicoolers serve a dual purpose: They keep Mondelez's Cadbury chocolate products from melting while positioning them directly in front of customers on or near cashier counters. The addition of the coolers, which has allowed the company to bring in brand extensions and more premium chocolates, “is an absolute gamechanger,” says Siddhartha Mukherjee, director of chocolates and media at Mondelez India. If only the company were always this adroit.

Before Kraft Foods Inc. split into two in October 2012, CEO Irene Rosenfeld cherry-picked the biggest global brands and assigned them to Mondelez. This would be the sexier, higher-margin “growth” company with 80 percent of its business in expanding markets abroad and, as she said at a consumer conference on the eve of the breakup, “poised to deliver top-tier revenue and earnings growth.” Two years in, the company hasn't delivered. Sales are stagnant and costs remain high. Since Mondelez's launch, its share price is up about 26 percent, barely outperforming its frumpier domestic sibling, Kraft Foods Group Inc., whose stock is up about 24 percent. And it's far behind the broader market: The S&P 500 index has risen about 40 percent over the same period. Unless Ms. Rosenfeld comes up with more ways t o s p u r growth—whether it be via innovations like chocolate coolers, reinventing wellworn products like O r e o , C a d b u r y, Tang and Ritz, or acquisitions—she risks an investor rebellion. Her own board, which includes activist

investor Nelson Peltz, may turn on her, too, if she doesn't begin to show progress in

Vol. 10 Issue 02 December 2014

CHOCOLATE her plan to boost substandard margins. “The leash is tighter than it used to be, and I think the management team is aware of that,” says New York-based Credit Suisse analyst Robert Moskow. He says the board even could sell the company if Ms. Rosenfeld can't deliver. LOW EXPECTATIONS The near-term prognosis isn't pretty. When Mondelez reports third-quarter results Nov. 5, analysts polled by Bloomberg News expect revenue of $8.38 billion, down 1.1 percent from $8.47 billion a year earlier. They expect adjusted income to plunge 7 percent, to $674.7 million from $727 million. To lift the bottom line (though not the top line), management wants to cut costs by $1.5 billion by 2016.

The company is investing nearly $400 million alone in India, where it has boosted the number of stores selling its products to 1 million—up roughly 40 percent from 2011. That still leaves more than 6 million trade outlets in which it does not have products, representing an exponential untapped opportunity. Many of those stores are in rural areas, where electricity is spotty or nonexistent, leading the company to begin developing cooling devices that will run on solar power.

It hired a new chief financial officer, Brian Gladden, to help figure out how. Among his priorities is reining in overhead costs, which rank among the bottom rung of its peers. Mondelez books about $347,000 in sales per employee, according to a Credit Suisse analysis. Northfield-based Kraft does more than twice that, generating about $813,000 per employee. One of Mondelez International Inc.'s larger "visicoolers" helps keep chocolate from melting in India. Despite innovations like this, Mondelez isn't gaining much ground. Amid its financial restructuring, Mondelez continues to chase growth in emerging markets like India, Brazil, China and Russia, which account for more than 40 percent of its sales and growing. Since 2010, the company has poured about $1 billion into those markets to build plants and hire workers to beef up supply and help it wring more out of its products. Those are investments that analysts think will position Mondelez for robust sales growth when these economies resume their outsized growth. That, in turn, would lift its stock price. “Unlike longer-term, secular concerns f a c e d b y p a c k a g e d f o o d t o d a y, Mondelez's current challenges appear cyclical and/or solvable,” writes David Palmer, an analyst at RBC Capital Markets LLC in New York, in an Oct. 27 note to clients, upgrading the stock to “outperform.”

Vol. 10 Issue 02 December 2014

“There's a consumer from a higher socioeconomic class that aspires to eating indulgent products like premium chocolates, and that segment has grown at a tremendous rate,” Mr. Mukherjee says. “It has been phenomenal for consumers and the brand, and we have plenty of room to expand.” What Mondelez doesn't have, though, is plenty of time.

GUMS

ce cream is a product made of milk, sweeteners, stabilizers, emulsifiers, and flavours. During processing, the ice cream mix is pasteurized, homogenized, and then frozen. Freezing involves rapid removal of heat from the mix while agitating to incorporate air (Marshall et al.,2003). This process is crucial for a good quality product. Proper control of the formation and growth of ice crystals in the ice cream freezer results in a large number of small crystals, which in turn produces a smooth texture and good storage stability (Hagiwara and Hartel, 1996; Wildmoser et al., 2004). In addition, the size and distribution of air cells play an important role in ice cream quality, with specific influence on the sensorial aspect of creaminess (Wildmoser and Windhab, 2001; Windhab and Wildmoser, 2002): as the air bubbles become smaller, the creaminess becomes more pronounced. A strong correlation between ice cream mix viscosity and the resulting air bubble

Vol. 10 Issue 02 December 2014

GUMS sizes was found by Chang and Hartel (2002) in a batch ice cream freezer. The freezing process is followed by hardening where the ice cream is frozen to – 40 °C in aspecialized room, tunnel, or contact plate (Marshall et al., 2003). The ﬁnal product is a complex multi-phase colloidal system consisting of protein, air cells, ice crystals, and fat globules. During storage, several physical and chemical changes occur in ice cream. The growth of crystals and recrystallization are an important physical change, which occurs as water diffuses from the serum phase to the crystal surface (Adapa et al., 2000). This phenomenon has a pronounced effect on the texture of ice cream. The coarseness or iciness in ice cream increases dramatically under poor storage conditions, i.e., where temperature ﬂuctuation occurs (Adapa et al., 2000). Stabilizers are added to ice cream to hinder the recrystallization phenomena, to increase the viscosity of the ice cream mix, to improve the texture and mouthfeel, and to enhance the shape retention of ice cream blocks (Marshall et al., 2003). Various hydrocolloids, such as guar gum, carboxymethyl cellulose, locust bean gum,carrageenan, and xanthan gum have been used as ice cream stabilizers with each stabilizer and stabilizer blend exhibiting unique functional properties (Hagiwara and Hartel, 1996; Miller-Livney and Hartel, 1997; Regand and Goff, 2003; Murtaza et al., 2004; Soukoulis et al., 2008; BahramParvar et al., 2010). Guar gumlocust bean gum, and xanthan gum are the most widely used hydrocolloids that inhibit the growth of ice crystals. These gums have high hydrating capacities even at low concentrations, and thus increase the viscosity of the serum phase in frozen ice creams. Carrageenan is the most commonly used secondary stabilizer; it helps to prevent wheying off in the mix. Furcellaran is a type of carrageenan that can be used as a stabilizing, thickening, and gelling agent in food (Thomas, 1997) without any side effects (Bender, 2005). The structure of furcellaran has been studied (Laos and Ring, 2005; Tuvikene et al., 2010) along with its gelling and sorption properties (Pritchkina and Chalykh, 1994; Michel

et al., 1997; Truus et al., 1997; Laos et al.,

2007b; Tuvikene et al.,2008) and interactions with different substances (Hughert and Sundelof, 2001; Laos et al., 2006, 2007a). However, there are no detailed accounts of either the effectiveness of furcellaran as a secondary ice cream stabilizer during storage or its impact on both the rheological and sensorial properties of ice cream. The present study analyses the inﬂuence of guar gum, guar gum/furcellaran, and guar gum/carrageenanblends on the rheological and sensorial properties of ice cream in the course of 13 months of storage., 2.3. Oscillatory rheometry The rheological measurements were carried out applying an oscillatory thermo-rheometry method (Wildmoser etal., 2004). A rheometer (Physica MCR301, Austria) with a plate–plate geometry (diameter 25 mm) was used. Both plates were proﬁled in order to avoid wall slip. A movable hood covering the plate–plate geometry also reduced the rate of heat exchange with the environment. The measurement temperature was continuously increased from – 20 °C to 10 °C at a heating rate of 1 °C/min. The test was performed at a constant angular frequency ù = 10 s−1 and at a constant strain ã = 0.02%. The gap width between the plates was adjusted to a constant value of 2 mm. Two replicate measurements were carried out for each ice cream blend. In the oscillation test, the storage modulus (G′) and loss modulus (G′′) were measured, which characterize the elastic and viscous behaviour of the measured sample.

Vol. 10 Issue 02 December 2014

Storage modulus data were registered at – 20 °C. 2.4. Sensory analyses The ice creams were evaluated for sensory characteristics (colour intensity, odour, odour intensity, avour,  a v o u r i n t e n s i t y, creaminess, sweetness, s o f t n e s s , m e l t a b i l i t y, brittleness, overrun, and sandiness). The procedures for the training of the panelists and the establishment of the sensory attributes were based on the method presented in Meilgaard et al. (1999). All samples were served in 30 mL plastic containers with lids and the evaluation was performed in plain view under white lights. Three one-hour training sessions were held over a period of a month prior to the first characterization. In these sessions, definitions of attributes and assessment techniques were introduced and a practical sample evaluation was performed. Sensory evaluations were characterized using an 8-point scale and each sample was presented in random order. At least 6 trained panellists participated in this study. 2.5. Statistical analyses Significant differences were defined at p < 0.05. An ANOVA was performed to evaluate the effects of the type and percentage of the hydrocolloids on the ice cream sensory properties (Duncan's

mean values comparison test) using XL Stat version 10.0 (AddinSoft 2010, New York, NY, USA) statistical software. Sensory data are presented as the mean of three parallels. 3. RESULTS AND DISCUSSION

GUMS 3.1. Mix viscosity The consistency coefficient, flow behaviour index, and apparent viscosity for ice cream mixes with different stabilizers are shown in Table 2. The flow behavior index of all mixes was observed to be less than one, which indicates pseudoplastic, shear thinning behaviour. Ice cream mixes with high consistency coefficients are more viscous. The consistency coefficients of guar gum/carrageenan mixes (G50 : C50 and G20 : C80) of 0.69 {i} 0.01 Pa s n were the highest among all

the stabilizer systems studied. The guar gum/furcellaran mix (G90 : F10) displayed the next highest consistency coefficient with a value of 0.68 {ii} 0.12 P a s n ; h o w e v e r, t h e s e t h r e e measurements are not significantly different. The ice cream mix with guar gum/furcellaran (G95 : F5) had both the lowest consistency coefficient (0.49 {iii} 0.00 Pa s n) and lowest apparent viscosity (671 mPa s). 3.2. Oscillatory rheometry In the low temperature range (– 20 °C to – 10 °C), the ice crystal microstructure governs the rheological behaviour. Wilbey et al. (1998) found a positive correlation between the hardness of ice cream and the amount of ice. Sakurai et al. (1996) also found that ice creams with large ice crystals are harder than those with smaller ice crystals. As ice crystals melt, the storage modulus (G′) and loss modulus (G′′) will decrease with increasing temperature. The influence of different stabilizers on the ice cream storage modulus at – 20 °C during 13 months of storage is presented in Fig. 1. The storage moduli of ice cream samples with guar gum/furcellaran blends in all ratios were the lowest of all measured samples (between 6.0 {i} 0.1 MPa for G95 : F5 and 7.7 {ii} 0.1 MPa for G50 : F50) while the ice cream with guar gum/ carrageenan blends in a ratio of 20 : 80

had the highest storage modulus (14.6 {iii} 0.1 MPa). The storage moduli of all ice cream samples increased during storage, indicating that ice recrystallization was occurring. The ice cream that consisted

during 13 months of storage is presented in Fig. 2. In the temperature range between 0 °C and 10 °C, all ice is melted, and only the dispersed air and fat phases have an impact on the rheological and quality characteristics. The loss

of a guar gum/carrageenan blend of 20 : 80 had the highest storage modulus values after 13 months of storage (23.8 {iv} 1.8 MPa) followed by the ice cream with only guar gum (18.9 {v} 1.1 MPa). Addition of ê-carrageenan to ice cream mixes led to the reinforcement of pseudoplasticity, possibly caused by gelation phenomena. Thaiudom and Goff (2003) reported that the presence of ê - c a r r a g e e n a n i n a protein/polysaccharides model solutions leads to a more heterogeneous distribution of casein micelles due to the formation of ê-carrageenan/casein complexes. Storage time had a minor effect on the storage modulus of ice cream samples with a high guar gum content (G80 : C20, G : F blends in all measured ratios). The effect of guar gum to reduce ice crystal growth rates was reported elsewhere (Sutton and Wilcox, 1998a, 1998b). It was suggested earlier that this may be due to the modiﬁcations to the viscoelasticity of the unfrozen phase surrounding the ice crystals (Goff et al., 1995). The inﬂuence of different stabilizers and their blends on ice cream loss modulus (G′′) at 10 °C

modulus G′′, which describes the viscous behaviour and ﬂowability of ice cream, can be correlated with creaminess. All fresh ice creams had high loss modulus values (between 405 {vi} 7 Pa for G20 : C80 and 489 {vii} 11 Pa for G75 : F25). During storage, the loss modulus decreased for all ice cream samples. The highest decrease was noted with ice cream G50 : C50, where the loss modulus value was 150 {viii} 13 Pa after 13 months of storage. The ice creams with guar gum/furcellaran blends showed the highest loss modulus values, the highest being for G75 : F35 with a loss modulus of 297 {ix} 8 Pa.

Vol. 10 Issue 02 December 2014

Fig. 2. Influence of hydrocolloids and their blends on ice cream loss modulus during 13 months of storage (G – guar gum, C – carrageenan, F – furcellaran). 3.3. Sensory analyses Consumers consider textural and flavour perception of ice cream as the most important factors for the ice cream. A group of flavour and texture specified attributes was used to evaluate the influence of hydrocolloids over the 13month storage period. The effect of hydrocolloids on the sensory attributes of each ice cream blend was determined both directly after preparation (Table 3) and after 13 months of storage (Table 4). The addition of furcellaran to ice cream slightly decreased the scores of colour, odour, and flavour characteristics but increased the creamy sensation. The softness of ice cream increased with the

GUMS

addition of guar gum. The highest scores of softness were obtained with the pure guar gum blend (8.00), followed by a guar gum/carrageenan blend 20 : 80 (7.78). The lowest softness score was obtained with the G90 : F10 guar gum/furcellaran ice cream blend (6.50).

brittleness in ice creams with only guar gum and a guar gum/ carrageenan blend (80 : 20) after 13 months of storage. The ice creams with guar gum/furcellaran blends in ratios 90 : 10, 75 : 25, and 65 : 35 displayed the best stabilizing effect during 13 months of storage.

During storage, the texture of ice cream gradually deteriorates. A strong decrease in softness, melting, and ďŹ&#x201A;avour properties was observed with increased

4. CONCLUSIONS The results presented herein show that stabilizers have a strong effect on ice cream properties during extended

Vol. 10 Issue 02 December 2014

storage. Furcellaran was found to be an effective secondary ice cream stabilizer together with guar gum. Although the addition of furcellaran to ice cream was found to slightly decrease the scores of colour, odour, and ďŹ&#x201A;avour characteristics, it increased the creamy sensation and had a good stabilizing effect on the ice cream during 13 months of storage.

 With an increase of

6% in visitor and 38% in the number of exhibitors, the exhibition was extremely successful.  Over 12,000 trade visitors came to the Bombay Convention & Exhibition Centre during November 14 to 16, 2014 to get information about technological solutions for the food and drink industry and for the packaging industry.

nternational FoodTec India, Sweet and SnackTec India, Dairy Universe India and PackEx India 2014concluded on a high note. Almost all the exhibitors from India and abroad were quite satisfied with the quality and quantity of the visitors who attended the trade fair. The 2014 edition saw an increase of 6%, up to 12,007 visitors. For the first time most of the key visitors from different industry sectors were present during all the three days visiting at the exhibition and constructively gathered insights into the technologies for the food and drink processing and packaging industries. A total of 466 exhibitors from over 30 countries presented their products and technologies on the three trade fair days, 48% of which were international brands. The exhibition once again confirmed its position as the best business platform that provides customized solutions for

the Indian market. A striking feature this time was that the stand presentations of the exhibitors which were substantially more extravagant than in the past years. The picture on the trade fair ground was characterized by intensive technical discussions at trade fair stands with lots of visitors. International FoodTec India 2014 acted as a great platform for buyers and sellers of technology in food, drinks, dairy confectionary, snacks, pharmaceuticals and cosmetics along with others to exchange dialogues to facilitate more business for future. It also gave the exhibitor's existing clientele an insight into the latest manufacturing technology techniques. The stream of visitors continued unabated even on Exhibition inauguration was held in the presence of Mr. Geoffrey van Leeuwen, Consul General, Consulate General of the Kingdom of The Netherlands, Mr. Erdal

Vol. 10 Issue 02 December 2014

Sabri Ergen, Consul General, Consulate General of The Republic of Turkey, Ms. Simone Schiller, Managing Director, Food Business German Agricultural S o c i e t y ( D L G ) , M r. A r u n P a t i l , Chairman, Indian Dairy Association Sunday, the last trade fair day. (West Zone), Mr. Subhash Mandge, Chairman, National Cooperative Dairy Federation of the India Limited, Mr. Ratan Singhania, President, Indian Pharma Machinery Manufacturers Association, Mr. Sanjeev Gupta, President, Agro & Food Technology Providers Association of India, Mr. Lars Dithmer, COO & Managing Director, Alfa Laval (India) Ltd., Mr. Denis Steker, Vice President International, Koelnmesse GmbH and M r. A s h w a n i P a n d e , M a n a g i n g Director, Koelnmesse YA Tradefair Pvt. Ltd. In his inaugural speech, Mr. G e o ff r e y v a n L e e u w e n , C o n s u l General, Consulate General of the

EVENT REPORT Kingdom of The Netherlands, has expressed his satisfaction with the active participation of 21 Dutch companies including the pavilion organized by FME / NAFTC. The Consul General assured the audience of future cooperation for the exhibition. Mr. Erdal Sabri Ergen, Consul General, Consulate General of The Republic of Turkey, announced that there will be even better participation in terms of both exhibitors and visitor in the future editions of International FoodTec India and PackEx India. The organizers Koelnmesse YA Tradefair India Pvt. Ltd., Indian Subsidiary of Koelnmesse GmbH also drew a positive balance. “We have achieved a new level with this result. Our success will be measured by the opportunities; the business and the value addition that we as an exhibition organizer are able to give to our exhibitors. All the exhibitors are really happy with us and this in turn makes us happy. Our exhibitors success is rightly our success”, said Ashwani Pande, Managing Director, K o e l n m e s s e YA Tradefair India Pvt. Ltd. "Our expectations with respect to the number of visitors and competence have been considerably exceeded. You sense a very positive mood with corresponding investment projects. The trade fair has become the optimum platform for the industry, and the many high-quality contacts promise good trade fair follow-up business", said Denis Steker, Vice President International at Koelnmesse GmbH. The exhibition had international pavilions from China, Europe, France, Germany, Italy, Republic of Korea, The Netherlands and Turkey. The exhibition proved out to be a great source for knowledge sharing with seminars on 'Future of Milk Based Nutraceuticals' organized by Indian Dairy Association (West Zone). The Guest of Honour for

the seminar was Prof. Dr. G. D. Yadav, Vice Chancellor & Dr. Mrs. Smita Lele, AG Registrar, ICT (Institute of Chemical Technology) and Mr. M. D. Deore, Director – Toxicology, Johnson & Johnson, Eminent speakers panel include Mr. A. K. Bayati, GCMMF, Mr. Allan Brunn, Alfa Laval, and other important dignitaries. 'Packaging Innovations in Pharmaceutical industry' organized by India Pharma Machinery Manufacturers Association (IPMMA) witnessed delegates like Ms. Neelam Lalwani, General Manager – Packaging, Sun Pharma Industries Pvt. Ltd. Mr. Sanjeev Khandelwal, Director Renewable Packaging, Stora Enso India., Mr. Chander Mohan Negi, Asst. General Manager, Akumentis Healthcare Ltd.,

among others. Starting from 2015, the trade fair will become an annual show that alternates between the locations of Mumbai and New Delhi. This new schedule will even better cover the complete need for new technology in the food and drink industry and packaging industry of the Indian subcontinent. The next edition of International

Vol. 10 Issue 02 December 2014

FoodTec India along with its concurrent trade fairs Sweet & SnackTec India, Dairy Universe India and PackEx India will be organized during September 10 – 12, 2015 in Pragati Maidan, New Delhi. Further information, the list of exhibitors and information about the supporting programme: www.foodtecindia.com About the organizer: Koelnmesse YA Tradefair Pvt. Ltd. is one of the leading trade fair organizers in India with the ability to bring markets and people together in an efﬁcient and highly professional manner. Based on in-depth knowledge of the Indian market, it organizes trade fairs on different business-to-business topics with active support from the principal company in G e r m a n y, c o s u b s i d i a r i e s , representatives and industry associations. Koelnmesse India's trade show portfolio includes industrial shows in heavy metal, dairy, food, food technology, chemical processing and packaging. Koelnmesse - Global Competence in Food: Koelnmesse is the leading trade fair organizer in the food industry and related sectors. Trade fairs such as the Anuga, the International Sweets & Biscuits Fair (ISM) and A n u g a F o o d Te c a r e established world leaders. Koelnmesse not only organizes food trade fairs in Cologne, Germany, but also in further growth markets around the globe, in Thailand, in China, in Brazil, in In the United Arab Emirates, in Turkey and in India. These global activities enable us to offer our customers a network of events, which in turn grant access to different markets and thus create a basis for sustainable and stable international business. International FoodTec India is a strong member of this successful trade fair.

EDIBLE OIL

nbeknownst to all, the edible oil industries has indeed grown leaps and bounds in the last few years, with its entry into the cosmetics industry, veterinary vaccinations and now even the pharmaceutical industry. India is the largest importer of edible oils, and the third largest consumer in the world. A total of 5-5.5 million tonnes of vegetable oils are imported and of that nearly 3 million tonnes is the popular palm oil, which is used in the manufacturing of vanaspati and the blending of various other oils for industrial purposes. Vegetable oils are a very important source of energy in human diet. Soya bean oil in particular is very popular and has the goodness of both Omega 3 and Omega 6. These fatty acids play a role in cholesterol management and help in preventing narrowing of artery veins. The edible oils industry has copious amounts to offer when it comes to the pharmaceuticals industry. At Kamani Oil Industries Pvt Ltd, we focus on: ● Novel drug delivery system ● Carrier system for capsules, soft and hard gels

Solvent for oil soluble vitamins, hormones, in injections ● Solvent for oral suspensions ● Ve h i c l e fo r t o p i c a l preparations like ointments, balms Novel Drug Delivery System: These systems are designed to deliver the right and effective dosage of the drug to the site of action. The issue arises when the possibility of effective delivery of the drug falls when the patient is an infant or a child. Liquid dosages are usually used in replacement of other delivery systems, but the not so pleasant taste of the drug, make administering the medicine to the child difﬁcult. The solution lies in using edible oils for a novel drug delivery system. Edible oils by physiological nature are no aqueous and when combined with thickening agents such as colloidal silicon dioxide create semi solids that are easy to administer in children and the disabled. This doesn't adversely affect the stability of the drug and also delivers the same effectively. Carrier system for capsules, soft and

Vol. 10 Issue 02 December 2014

●

Vol. 10 Issue 02 December 2014

EDIBLE OIL hard gels Edible oils such as soybean oil, rapeseed oil, palm oil and cotton seed oil are commonly used as a blend to create carrier systems for capsules and in the formula of creation of both soft and hard gels. The components of the carrier composition include from about 84% to 95% of a vegetable oil, from about 1% to 9% of a viscosity modiﬁer and from about 1% to 15% of a surface active agents. Solvent for oil soluble vitamins, hormones, in injections Drugs must be properly formulated for administration. Lipophilic or low soluble drugs are a major problem when it comes to

formulation design in the pharmaceutical industry. Emulsions thus are popular candidates. They increase drug solubility as they incorporate

lipophilic drugs, reduce side effects of potent drugs and even to prolong the

pharmacological effects. Oil and Water emulsions have been widely used in pharmaceuticals. The oils that are used for these emulsions are digestible oils extracted from natural sources such as soybean oil. Why soybean oil? Soy bean oil has a high smoke point, is cheap and have numerous health benefits, thus it is used to produce new, c o m p a t i b l e formulations which are cost effective. The edible oil industry is flourishing and slowly becoming more and more integral to the pharmaceutical industry and with the steady progress in the field, more and more uses of edible oil are being derived with each passing day.

FCI restructuring should ensure smooth procurement of crop Punjab govern m e n t today said the restruct uring of t h e Food Corporation of India (FCI) should ensure smooth procurement of crops and it should also benefit farmers and consumers. It should be in such a manner that it should benefit both farmers and consumers besides ensuring flawless procurement and public distribution system (PDS)," Punjab Chief Minister Prakash Singh Badal placed his views before former union minister and senior BJP leader Shanta Kumar who is heading the committee for restructuring of FCI. The committee is mandated to give suggestions to reorient FCI's role and functions in MSP operations, storage and distribution of food grain and food security systems.

Taking part in the deliberations, the Chief Minister urged Shanta Kumar that the restructuring of country's premier food procurement agency should be done to eliminate difficulties and bottlenecks in way of smooth and timely procurement of food grains. He recalled the significant contribution of Punjab in national food security adding that agriculture was the lifeline of the state and also of nation. The Chief Minister suggested the committee that a mutually agreed Memorandum of Understanding (MoU) must be signed between the FCI and the state government well in advance of procurement season clearly stipulating obligations and rights of both the stakeholders in detail. Likewise, he also opined that the cost sheets should also reflect realistic and actual costs besides deputing separate staff for procurement and movement of grains. Badal said that the storage charges should be rational and FCI should procure its allotted share.

Vol. 10 Issue 02 December 2014

He further said that the system of Minimum Support Price (MSP) must not be done away with abruptly until it introduces a self-sustaining mechanism of income support to the farmers. He urged the committee to strongly recommend state's case for allocating s u ffi c i e n t f u n d s f o r a g r i c u l t u r e diversification as the previous UPA government just sanctioned a peanut of Rs 500 crore, against Rs 5,000 crore sought by the state, for Punjab and Haryana of which the state was allotted merely Rs 225 crore. Shanta Kumar assured the Chief Minister that the committee would look into all the aspects and issues raised by the latter before taking a final decision. He said that the committee would give due weight age to the suggestion put forth by the various stakeholders to further strengthen and integrate the supply chain of food grains besides bringing far more transparency, efficiency in the procurement and PDS by the FCI.

he Indian food industry stood at US$ 135 billion in 2012 and is expected to grow at a compound annual growth rate (CAGR) of 10 per cent to about US$ 200 billion by 2015, according to a report by KPMG. Indian agricultural and processed food exports during April-May 2014 stood at US$ 3,813.63 million, according to data released by the Agricultural and Processed Food Products Export Development Authority (APEDA). In 2013-14, the total processed/value added agricultural products exported and the foreign exchange equivalent earned therefrom stood at Rs 4,627.99 crore (US$ 752.39 million) as compared to Rs 3,689.26 crore (US$ 599.89 crore) during the previous year. The processed food industry include both the organized and unorganized sector where organized forms 50-55% of the overall market. Grains and pulses, beverages and other foods and dairy products make up around 80% of the total processed food market . The sector is expected to grow at around 13 percent on a nominal basis and reach size of USD

530-550 billion by 2020. Within the food processing sector, segments like meat and marine, edible oils, grains and cereals are expected to witness high growth rates. Marine product exports from India touched US$ 5.01 billion during FY14, according Marine Products Export Development Authority (MPEDA). Scope and role The food value chain in India is different from many other markets like U.S. due to unique consumption pattern in the country and presence of both organized and unorganized players. As a result, consumption at the retail level consists largely of non-processed products or food with very limited processing in key categories like fruits and vegetables, meat and poultry, dairy, grains, and pulses. The difference in the Indian market is driven by both demand and supply driven factor; Consumption behavior: Indian consumers prefer to procure food in

Vol. 10 Issue 02 December 2014

Food security is important for reducing poverty and the sole answer to it is the development of the food processing industry in India. This Industry with its capacity has the magic wand to eradicate food loss, feed the poor and provide food security. The only thing is we need to nurture in the right way and at the right opportunity

Vol. 10 Issue 02 December 2014

FOOD PROCESSING of the value chain through its forward and backward linkages.

unprocessed and fresh form and then convert it into a consumable form through the food preparation process either in homes or restaurants. This is distinct from many other countries where consumers prefer to purchase more ready-to-eat foods. The consumption behavior is changing in the urban centers, however, as the younger generation is shifting toward processed foods due to paucity of time.

 Farming and other food production: Increasingly, the food processing companies are strengthening their backward integration through initiatives like agriculture extension services. This will drive higher productivity in the farming sector and improve quality and safety. With higher visibility of demand, food processing companies can also help in improving the crop mix in agriculture, leading to better availability and affordability of food products.

Wider availability: Most food products in India, like fruits and vegetables and milk, have a wide availability across the country, which is very unique to India. This leads to lower need for packaging and preserving food for transportation over longer distances.

 Procurement: Food processing companies can deploy more scientiﬁc methods for sorting and grading of produce. Higher involvement in procurement will also help improve price realization for farmers by reducing intermediaries and thus lowering price buildup through elimination of nonvalue-adding activities.

Limited evolution of food processing sector: In areas like core processing, warehousing, logistics, and production, the food value chain in India is still nascent with limited use of modern technology and labor-intensive processes as compared to countries like the U.S., which are characterized by large-scale contract farming, extensive cold chains, and advanced warehousing capabilities. These differences lead to multiple challenges like higher wastage, limited opportunities for food fortiﬁcation through nutrients and quality and safety risks. The food processing industry thus has a much wider role in Indian context. This role can be split in to core activities which involve:

 Supply chain: The increasing role of the food processing industry can help accelerate investment in storage and transport capabilities, thereby lowering wastage levels, improving nutrient retention during storage and transportation, and enhancing shelf life of products.

 Primary processing like cutting, cleaning and refrigeration  Secondary processing like of grain milling, manufacture of fruit pulps, frozen meat and poultry, packaged milk etc.  Tertiary activities processing like manufacture of fruit jams and juices, biscuits, milk products, ready to eat meals, protein supplements, confectionery. These activities help in preserving food nutrients, increasing shelf life of food, improving nutrition levels through fortiﬁcation and providing wider choices for the consumer.  In addition and equally important, the food processing sector can impact the other areas

CHALLENGES FOR THE FOOD INDUSTRY There are several challenges that need to be addressed in order for the food industry to be able to achieve the availability, affordability, awareness, quality and safety goals necessary to feed India's population of over a billion. These challenges span the food value-chain from production and farming to retailing and consumption and have differing relevance for each food segment; Slow production growth: India's highly fragmented farming landscape with low average farm sizes is a major challenge in quantum improvements in farm-level productivity. India has among the lowest average farm

Vol. 10 Issue 02 December 2014

sizes globally. Low farm size leads to an inability to invest in improving productivity. However, the bottleneck of small landholdings can be overcome, as illustrated by other Asian countries, which have even smaller average sizes but higher yields of major crops. South Korea, for example, witnessed an explosion in mechanization due to training, the establishment of farm machinery service centers in rural areas, the promotion of co-operative machinery ownership and utilization, and government programs ensuring access to credit. In addition, increasing levels of contract farming led to large-scale de-facto consolidation of land holdings (without transfer of land title) enabling greater farm investment. The challenge in India lies in the lack of success of agricultural extension services, limited implementation of better farming techniques, limited R&D spending, limited farmer access to credit and the inability to leverage scale through consolidation of demand for inputs. Limitation on production incentives clarity: While government involvement in procurement and distribution of nonperishable foods including staple food grains and oilseeds is critical for food security in India, it is also a major source of demand-supply mismatches in food value-chain. Through the 1990s,

FOOD PROCESSING Minimum Support Prices (MSP) increases for rice, wheat and other food grains outstripped increases for oilseeds. The high level of government procurement (estimated to be around 30 to 40 percent of total food grain production currently) drove increasingly favorable returns from food grains and resulted in diversion of land away from oilseeds. The huge impact that government price setting and procurement can have on crop patterns highlights the need for an integrated strategy from agricultural production to consumer nutritional demand, in order to ensure sufﬁcient food across income classes. Alternatively, better demand-supply matching can be attempted through the involvement of

private players. For example, contract farming, would give an assured market for farmers and hence improve the inﬂuence of private sector demand signals on the farmer crop production. Government also plays a role in other incentive signals that impact production. For example the reduced import duty on edible oil imports negatively impacts the incentive for farmers to increase local oilseed production due to the costcompetitiveness of imports. A balanced import duty regime that seeks to protect consumers while reducing import dependence could ensure this. Low coverage of organized procurement and limited transparency in current setup: Access to organized procurement can be an important enabler to improving food production and food availability, by providing farmers a better guarantee of volumes and better price realization per unit sale. For example, the dairy cooperative movement was fundamental in

transforming the fragmented rural milk production industry from selfconsumption and local sale to consistent marketable surplus. Even in the case of dairy co-operatives, however, coverage of farmers is still low. In other segments, such as fruits and vegetables, which is regulated by a variety of APMC acts across states, the result of limited organized procurement is a long and inefficient supply chain. Presence of multiple intermediaries between farm and fork leads to high supply-chain wastages, price-buildup from non-value-adding activities and deterioration in quality. Farmers also tend to get lower realizations from unorganized procurement due to a lack of competition and product spoilage. For example, l i c e n s i n g regulations are a major entry barrier to private players, who could increase competition and possibly improve realizations for farmers. In addition, a large s h a r e o f commissioning agents also finance farmers' production through short-term loans indebting farmers and leading to lower sale prices for farm produce. Poor procurement and supply chain infrastructure: Various factors contribute to the poor infrastructure levels in the food supply chain. Primarily these include the high consumer demand for fresh or live-cut produce, the large share of unorganized players in the supply chain and operating commercial viability challenges. As a result, regional imbalances in food production and demand become difficult to address. For example, the high share of 'wet' markets for poultry – estimated to be as high as 80 to 90 percent – limits the ability to shift poultry from excess to deficit regions, due to the high mortality and shrinkage associated with transportation of live birds. Limited infrastructure also increases supply chain wastage and reduces quality and nutrition levels of foods. For example, wastage in the fruits and vegetables is estimated to

Vol. 10 Issue 02 December 2014

be 6 to 18 percent in the post-harvest portions of the value-chain. A good example is the current state of cold-chain infrastructure in the country. The current gap to demand is around 38 million tons, against an installed capacity of around 24 million tons. With wastage in the fruits and vegetables supply chain estimated at INR 44,000 crore, the investment requirement of INR 26,000 crore to install 38 million tons of cold chain storage, would seem plausible. Even with government incentives to invest in cold chain, however, these projects have limited progress. This is especially true for third party logistics operators for whom, market remuneration would not provide suitable returns on investment. Investment in cold storage will most likely require involvement of players already involved in the value-chain, including upstream players such as retailers, and downstream players in production and procurement. H o w e v e r, t h e s e p l a y e r s t o o , t h e fundamental absence of consumer demand due to preference for fresh produce and the higher cost of frozen food, means that alternative approaches will likely be needed to address this issue in the short-run. These could include, for example, improving government contributions to viability gap funding, allowing for private trading to improve returns and enabling lower cost of frozen foods through lower packaging costs or cold chain operating costs. There is major fragmentation of food processing capacity, with a large unorganized segment and widespread use of primitive processing. This results in lower value-added at the processing stage, especially from a nutritional point of view Powerful ideas like fortification of flour with micronutrients that have been adopted globally, would be difficult to implement and monitor in India, given this large unorganized presence and difficulty in ensuring adoption of improved technology. For example, the 58 percent of iron currently lost in India, during the processing of 15 to 18 million tons of wheat to flour could ensure a daily availability of around 40 to 50 milligrams of iron per capita – almost double the recommended dietary allowance of 30 milligrams. The high consumer sensitivity to price means that greater value-addition, which would increase the

FOOD PROCESSING credit, technical a d v i c e o n productivity improvement and machinery selection and trainings on a d o p t i n g standardized processes. The linking of these incentives to actual wastage reduction and nutrient quality improvement, while ideal, would likely be difﬁcult to implement without involvement of private sector organized players in value chain.

Government will need to ensure an effective mechanism for contract enforcement and grievance redressal for all stakeholders. Protection of rights for small farmers is another area where Government needs to play an active role. Private players will need to develop relevant contract farming models for various crops and geographies. These contract farming models may include entities like banks and input providers to address specific challenges faced by the region. Invest in R&D and technology to improve yields and reduce wastage: The need for increased R&D and adoption of modern technologies is most critical at the production and processing stages.  At the production stage, this is critical to counter the challenges of plateauing yield growth, increasingly scarce resources such as land and water, rapidly deteriorating quality of soil among others. Investments in R&D and technology will be essential to drive the much needed second green revolution in India. For example, extraordinary success stories such as the use of SRI (system of rice intensification) techniques in states like Bihar and Tamil Nadu should be built upon, through pilots in other states and best practice sharing. There is a need for sustained investment of all value-chain players in continually improving the factor productivity of agriculture, be it through highyield seed varieties, better cultivation techniques or wastage reduction at harvest.  At the processing stage, small scale and unorganized sectors, which account for a substantial portion of the food processing i n d u s t r y, n e e d t a r g e t e d programs to improve p r o d u c t i v i t y, a c c e s s t o t e c h n o l o g y, c r e d i t a n d downstream markets. This will enable reduced wastage and nutrition losses in processing. Potential programs could include financial assistance for procurement of machinery and

 Academia, government and private players all have a major role to play indentifying, prioritizing and enabling implementation of the most cost-effective and high-impact innovations. In addition, private players and governments can also enable adoption of readily available technologies and greater mechanization through ﬁnancial or procurement assistance. Enhance transparency of price, volume and inventory in wholesale markets This is most relevant for foods sold through the government regulated Mandi route – primarily fruits and vegetables. The key improvement needed is in transparency of transactions, enabling effective and efﬁcient demand-supply matching. There are multiple aspects that need to be addressed, primarily coverage of transactions and reliability of data. Technology can be a useful aid in this scenario. For example, in Thailand's Phitsanulok Agricultural Central Market, weighbridges are linked to computers. This enables immediate invoicing for tolls, automatic generation of sales records and ensures reliability of volume data. It is challenging in India's context, to expect availability of real-time price data for all transactions, due to the large share of secret bidding transactions. However better knowledge of volume and inventory data can allow more accurate price estimations and reduce

Vol. 10 Issue 02 December 2014

opportunities for collusion. Simplify regulatory environment The regulatory complexity of the food value chain in India needs to be addressed on priority. There should be focus on two key areas including standardizing legislation across states and ensuring alignment with globally accepted standards.  Standardization of regulations such as APMC Acts across states should be accelerated. Lack of standardization leads to higher costs and longer timelines for companies that operate across states. Standardization of food regulations across states is thus critical to improve efﬁciency of the food value chain. The Ministry of Agriculture has recommended states to amend the APMC Act on the line of a Model Act that will facilitate development of agricultural marketing infrastructure through private sector investments. This will enable alternate marketing channels for farmers for sales of their produce where prices are more remunerative for them. However, there is no stipulated time frame for implementation – only a few states have amended regulations as per the Model Act and even fewer have implemented it. Some states like Himachal Pradesh, Andhra Pradesh have already implemented contract farming and direct marketing in their Acts leading to better prospects for farmers in these states while others have done only partial

FOOD PROCESSING cost of foods, is difficult. Lack of scale limits the ability to increase valueaddition through cost-effective adoption of new technologies. The processing industry also has limited incentives to drive this. For example, under current regulation, a premix of ingredients for fortification would incur VAT, whereas tax breaks have helped improve costeffectiveness in global examples. Over-regulation of larger processing players is also a challenge to increased processing value-addition. For example the harmonization of Indian regulations with global standards such as Codex, would enable greater flexibility for food processors – such as enabling cost reduction – thereby ensuring consumers don't discount higher quality, safer options purely due to prohibitive costs. In addition, this limits the market making role of the processing industry by preventing the ease of translating globally successful new food products in the Indian market. Harmonized regulations could vastly increase the choices and quality of foods available to domestic consumers while potentially improving affordability by allowing processors to leverage global scale, reducing long testing lead times and additional re-testing costs. Depleted control on quality and safety: While India does have strong food safety laws and an organization tasked with ensuring food safety and quality, there are major gaps in the actual implementation. The sheer number of players, especially in the large unorganized segment, involved in the food value-chain, makes implementation of quality and safety norms difficult. In the case of the meat industry, for example, the number of unregistered premises where animals are slaughtered is more than six times the number of registered slaughterhouses. Unregistered slaughter houses aren't regulated, have poor hygiene levels and lack in basic facilities such as drainage and waste disposal. In addition, poor preand post-inspection practices due to the absence of veterinary staff also impact q u a l i t y. A s a r e s u l t , m i c r o b i a l contamination and contamination from dung and soil pose significant health risks to domestic consumers. An abattoir modernization program currently ongoing as part of the 11th and 12th five year plans, is targeting to address some of

these challenges. The food safety challenge spans the value-chain. For example, the highly unorganized supply chain for perishables limits the ability to effectively control safety. This has led to practices such as milk adulteration and use of carbide for fruit ripening becoming more widespread. The need to offload all fresh produce to minimize losses means that poor quality food is also sold off. At the farm-level as well excessive use of pesticides and fertilizers and inadequate cleaning during the post-harvest stage result in harmful chemical residues entering the food value-chain. Limited availability of skilled resources: A severe shortage of skilled manpower across the food value-chain is a major challenge. At the food processing stage, resource skills and knowledge are also a major challenge, with lack of awareness of food regulations resulting in high downstream rejection rates, especially with unorganized suppliers. Without substantial investment in skill development across the value-chain and including R&D and technology, this could become a critical bottleneck Low consumer awareness: Consumer awareness is a critical aspect of an improved nutritional situation in the country. Consumers currently lack awareness of several nutritional and food safety and quality aspects, most notably insistence on primarily fresh produce resulting in exposure to health risks and low quality foods. Low consumer demand also limits improvements across the value-chain for perishable goods. There is limited knowledge of fundamental micronutrient deficiencies in the Indian diet and of how consumption of certain foods can address this gap, for example fruits and vegetables, meat and poultry and fortified processed foods. Consumers' aversion to processed foods as fundamentally unhealthy is also a challenge, limiting the industry from improving food variety or adding new healthy food segments. Educating consumers of the need to increase consumption of better quality, safer foods and to increase targeted micronutrient intake can drive quantum improvements in the country's nutrition situation while providing impetus for back-end improvements in the respective industries.

Vol. 10 Issue 02 December 2014

I M P E R AT I V E S F O R F O O D SECURITY OF INDIA The country today faces several issues across the food value chains that impact

food availability, affordability, quality and safety, and consumer awareness. There are many government and private initiatives in place to help overcome these challenges. However, the success so far has been mixed due to scale of the industry, limited resources, and gaps in implementation. India requires a fresh look at the existing initiatives to enhance effectiveness and remove impediments in implementation. The success of these initiatives will require private enterprises as well as government to focus on priority areas like regulatory standardization, consolidated food and food processing policy, stronger implementation of policies in select areas such as food safety and consumer awareness, and innovative models in areas of farm extension services and commercial viability of food chains. Increase private participation in production: Many food chains in India suffer due to lack of adequate scale in production which in turn creates limited ability of farmer to invest in new technology as well as ability to enhance productivity. Alternate models like contract farming, corporate farming and co-operative farming can help address these issues with availability of new technologies, production practices and greater access to ﬁnance. Models like contract farming also provide greater control on quality and price of supply for private players. Government and private players will need to work together to identify and implement contract farming at a large scale.

Vol. 10 Issue 02 December 2014