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1
Cold Chain Grid in India
D&B Tangram Advisory Services
2016
2
COLD CHAIN GRID IN INDIA
India is the largest producer of milk and second largest producer of fruits and
vegetables in the world, after China. Among fruits, the country is the largest producer
of banana, papaya and mango in the world, while among vegetables, it has the largest
production base for okra and ginger.1 India is also a major producer of meat and
poultry products.2 Despite the large production base, much of the produce is wasted
in the supply chain. Estimates show that inefficient handling, transportation and
storage methods lead to wastage of up to 18 per cent of the fruits and vegetables, 0.8
per cent of milk, 3.7 per cent of poultry and 2.3 per cent of meat produced.3 Several
reports have pointed out that a lot of the wastages are due to the inadequate cold chain
infrastructure in the country [for example, see National Centre for Cold Chain
Development (NCCD) and National Bank for Agriculture and Rural Development
(NABARD) Consultancy Service (NABCONS), 2015].
Cold chain is a temperature controlled logistics system that provides a series of
facilities to maintain ideal storage conditions for perishables from point of origin to
point of consumption in the food supply chain (Planning Commission, 2012). It is
aimed at increasing the shelf life of the perishables (for example, fresh fruits and
vegetables, milk, meat and poultry), thereby reducing wastages and preserving the
quality of a product.
The cold chain constitutes several components including pack-houses, cold storage
facilities, reefer vehicles and temperature controlled chambers, among others. For a
smooth functioning, it is important that the different components of cold chain are
well-integrated forming a cold chain network. In other words, there is a need for a
cold chain grid in the country.
Globally, there is no formal definition of a cold chain grid. It may be described as an
interconnected network of cold chain infrastructure from farm-to-fork. Generally,
companies have their own end-to-end cold chain infrastructure—for instance,
Kelvin Cold Chain Logistics Private Limited provides end-to-end integrated cold
chain services. There are other companies, which specialise on a particular component
of cold chain. For example, Carrier Transicold has refrigerated units and vehicles.
In India, most of the companies in the cold chain sector are small and they have less
than five cold storages or refrigerated vehicles. In most cases, the private players are
the ones that develop cold chain infrastructure while the role of the government is
largely to identify the gaps in the cold chain infrastructure. Further to this, the
government provides incentives and launches schemes to encourage and support the
private players to invest in the infrastructure. In India, one of the biggest issues is the
presence of a large number of unorganised players in the cold chain sector. This leads
1 Agricultural & Processed Food Products Export Development Authority (APEDA), Ministry of
Commerce and Industry, Government of India. 2 Ministry of Food Processing Industries (MoFPI) (2014–15); p.8. Available at:
http://www.mofpi.nic.in/H_Dwld.aspx?KYEwmOL+HGpoo8DlNeKVV3fE4aW5+awTGdnZC9kP6Bj
7+tZmOXaEjQ== [Accessed 9 January 2016]. 3 Central Institute of Post-Harvest Engineering and Technology (CIPHET) (2013). Available at:
http://ciphet.in/upload/file/Vision_2050%20revised%20on_6-7_13.pdf [Accessed 30 December 2015].
3
to fragmentation in the cold chain infrastructure and reduces efficiency. It also leads
to demand–supply gaps and sporadic development of infrastructure.
Realising the need to have an integrated cold chain infrastructure in India, in May
2007, a Task Force on cold chain development in India was set up by the Ministry of
Agriculture with members drawn from various stakeholders such as the Central and
State governments, National Horticulture Board (NHB), State Agriculture
Universities and Confederation of Indian Industry (CII). The purpose of this Task
Force was to encourage and ensure participation of stakeholders in developing the
cold chain and monitor the programme execution within the stipulated timeframe.
One of the recommendations of the Task Force was to establish the National Centre
for Cold Chain Development (NCCD) as an autonomous centre for excellence to
work in close collaboration with industry and other stakeholders to promote and
develop integrated cold chain in India for perishable fruits and vegetables and other
perishable allied agricultural commodities. NCCD has initiated work on this area. The
Task Force also recommended the creation of the National Green Grid, climate
controlled transportation network and subsidy provisions for infrastructure projects.4
Details on the National Green Grid are provided in Box 1.
4 Planning Commission (2012). ‘Report of the Committee on Encouraging Investments in Supply Chains Including Provision for Cold Storages for More Efficient Distribution of Farm Produce’. Development Policy Division Planning Commission Government of India. Available at: http://planningcommission.gov.in/reports/genrep/rep_supply1312.pdf [Accessed 22 January 2016].
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Box 1: The National Green Grid
The idea behind the National Green Grid was to “develop a seamless end-to-end transport
network to balance demand–supply issues pertaining to food logistics and enable the
producers to fetch a proper remunerative price while ensuring the qualitative availability of
such perishable produce for longer duration and thereby facilitating price stability”
(Ministry of Agriculture, the Government of India, 2008). The Grid would facilitate
transportation of fresh perishable agricultural produce, including fresh fruits and
vegetables, aquatic products, animal protein, eggs and milk products. It is proposed to be
developed on the concept of multi-modal transport using a mix of road-rail-road mode to
start with. This could also be extended to the use of road-sea/waterways-road in the case of
domestic market or road-rail-sea-airport for overseas market for export purposes. The
proposed National Green Grid can be established in a phased manner with due linkages
along the major freight corridors—both road and rail.
In Phase I, the grid is proposed to be established along the Golden Quadrilateral Network
and the major trunk railway lines connecting Jammu &Kashmir (Jammu), Himachal
Pradesh (Kalka), Kerala (Thiruvananthapuram), North-East (Guwahati) and Uttarakhand.
This would also involve creation of the Mega Perishable Centres at Delhi, Mumbai,
Kolkata, Bangalore, Nagpur, Guwahati, Jammu and Kalka. Long distance movement along
the National Green Grid is envisaged to be undertaken mainly through existing and
proposed rail networks as the railways are a cheaper mode of inland transportation.
Phase II will witness the development of regional green grids having inter- and intra-state
linkages along the state highways, other freight and rail corridors. The Perishable Cargo
Centres will also be created along the major production, consumption and export centres.
The indicative locations have been worked out state-wise to link the major fruits and
vegetable clusters to consumption centres for the same which will be integrated with the
existing perishable cargo centres. Hence, the Mega Perishable Centres will be linked to the
Perishable Cargo Centers, which will facilitate the hub-and-spoke model of development
for reefer transportation. A reefer container bank through regional hubs will ensure the
availability of refrigerated containers in requisite numbers.
5
Potato
26%
Tomato
12%
Onion
11% Brinjal
8%
Cabbage
6%
Cauliflower
5%
Tapioca
5%
Okra
4%
Peas
2%
Sweet
Potato
1% Others
20% Banana
33%
Mango
21%
Citrus
13%
Papaya
6%
Guava
4%
Apple
3%
Pineapple
3%
Sapota
2% Grapes
2%
Pomegranat
e
1% Litchi
1%
Others
11%
More recently,5 the government has pointed out that in order to develop a grid, there
is also a need to create a food map to identify the states with surplus and those with
deficit thereby connecting the two through a seamless infrastructure.
Given this background, this report lays out the process for designing a cold chain
grid. Cold chain grid requires information about production hubs, processing units,
consumption hubs, and existing and projected cold chain infrastructure, among others.
This information is presented in the report taking the example of fruits and vegetables
(both fresh and processed), which require cold chains.
The report identifies the supply and demand gaps in cold chain grid, which will
enable the private players to make their investment decisions. Cold chain is identified
as a priority sector for investment in India and 100 per cent FDI is allowed in cold
chain infrastructure. It is expected that this report will help foreign investors to make
their investment decision in the cold chain sector in India.
Production Centres in India
As mentioned earlier, India is the largest producer of many fruits and vegetables in
the world. During 2013–14, India produced 88.98 million metric tonnes of fruits and
162.89 million metric tonnes of vegetables.6 Production statistics for fruits and
vegetables by different states are provided by the NHB. According to the data
released by NHB, the major fruits and vegetables produced in India include banana,
mango, potato and tomato, among others (see Figure 1).
Figure 1: Production share of major fruits and vegetables in India (2013–14)7
Source: Compiled from NHB (2014). p.4. Available at: http://www.nhb.gov.in/area-
pro/NHB_Database_2015.pdf [Accessed 22 December 2015].
5 See http://retail.economictimes.indiatimes.com/news/food-entertainment/grocery/govt-plans-national-
food-grid-to-rein-in-prices/38462474 [Accessed 12 January 2016]. 6 National Board of Horticulture (2014). Available at: http://www.nhb.gov.in/area-
pro/NHB_Database_2015.pdf [Accessed 30 November 2015]. 7 2013-14 refers to the Indian Financial Year from 1 April 2013 till 31 March 2014.
Fruits Vegetables
6
In terms of state-wise production, more than 50 per cent of India’s production of fruits
and vegetables is concentrated in five or six major Indian states. For instance, in
2013–14, Maharashtra (15 per cent), Andhra Pradesh (12 per cent), Gujarat (9 per
cent), Tamil Nadu (8 per cent) and Uttar Pradesh (8 per cent) were the major
producers of fruits. In the same year, West Bengal (14 per cent), Uttar Pradesh (12 per
cent), Bihar (9 per cent), Madhya Pradesh (8 per cent) and Gujarat (7 per cent) were
the major producers of vegetables.8 The state-wise details of fruits and vegetable
production are given in Table 1.
Table 1: Fruits and vegetables area and production across states (2013–14)
States Fruits Vegetables
Area (‘000
HA)
Production
(‘000 MT)
Area (‘000
HA)
Production
(‘000 MT)
Andaman
Nicobar
3.55 29.73 6.89 51.79
Andhra Pradesh 640.05 10510.56 439.64 8149.76
Arunachal
Pradesh
89.09 321.26 1.40 35.00
Assam 144.68 2007.80 281.40 3031.90
Bihar 302.07 4013.58 809.80 15097.77
Chhattisgarh 212.89 1930.18 403.43 5465.92
Dadra and Nagar
Haveli
0.00 0.00 1.10 5.50
Daman & Diu 0.00 0.00 0.00 0.00
Delhi 0.00 0.00 27.30 436.95
Goa 11.28 81.19 7.00 79.92
Gujarat 370.76 8001.96 582.28 11571.24
Haryana 50.59 554.90 373.17 5565.90
Himachal
Pradesh
220.71 866.34 86.60 1635.88
Jammu &
Kashmir
355.21 2073.94 63.06 1395.47
Jharkhand 94.03 890.04 313.61 4238.13
Karnataka 396.00 6652.42 418.69 7500.69
Kerala 376.95 2889.50 147.69 3572.67
Lakshadweep 0.22 0.48 0.25 0.33
Madhya Pradesh 203.79 5696.00 628.72 13019.31
Maharashtra 1565.00 13457.92 726.00 10161.83
Manipur 54.05 515.69 25.19 271.04
Meghalaya 35.30 348.00 43.60 515.34
Mizoram 57.55 343.90 41.10 254.14
Nagaland 40.56 411.00 38.55 492.37
Odisha 325.86 2148.27 677.33 9433.66
8 Compiled from NHB (2014). p.10. Available at: http://www.nhb.gov.in/area-
pro/NHB_Database_2015.pdf [Accessed 22 December 2015].
7
Puducherry 0.64 12.58 0.90 16.26
Punjab 76.59 1541.24 191.02 3936.19
Rajasthan 37.40 581.78 148.88 1114.07
Sikkim 16.02 24.05 26.11 134.53
Tamil Nadu 328.55 7369.86 289.74 8678.82
Telangana 364.48 4440.98 220.94 3647.28
Tripura 68.38 786.35 46.69 780.52
Uttar Pradesh 378.97 6887.45 859.38 18544.96
Uttarakhand 171.62 678.49 88.28 1016.83
West Bengal 223.50 2909.71 1380.30 23044.95
Total 7216.31 88977.13 9396.06 162896.91
Source: Final Area and Production Estimates for Horticulture Crops (2013–14).
Available at
http://nhb.gov.in/PDFViwer.aspx?enc=3ZOO8K5CzcdC/Yq6HcdIxC0U1kZZenFuN
VXacDLxz28= [Accessed 22 December 2015].
As indicated in Table 1, India’s major production centres are concentrated in a few
states. However, consumers are located throughout the country and a large number of
the consumers of fresh fruits and vegetables are in the Indian cities. Therefore, these
cities have a large share in the consumption expenditure in the country (for details see
McKinsey and Company, 2007).
In India, cities are classified in different tiers9 based on the population residing in
those cities. For example, Tier 1 cities include cities like Delhi, Mumbai, Bangalore,
Chennai, Hyderabad and Kolkata while Tier 2 cities include cities such as
Bhubaneswar, Chandigarh, Patna, Srinagar and Nagpur. Hence, it is important for the
fresh and processed production to reach the consumers from the production location
to the consumption location through a cold chain network or grid.
The next section focuses on the spread of the food processing units in India. The fresh
produce has to reach the processing units and the processed goods from these units
have to reach the consumers.
Food Processing Centres in India
In India, 9 per cent of the gross domestic product (GDP) of the manufacturing sector
and 11 per cent of the GDP of the agriculture sector come from the food processing
sector. The food processing sector has been growing at an average annual rate of 8.4
per cent, which is greater than the growth of agriculture and manufacturing sectors.
The Annual Survey of Industries (ASI) conducted by the Ministry of Statistics and
Programme Implementation (MOSPI) provides data on industrial production at the
two digits National Industrial Classification (NIC). Food processing sector is covered
under Division 10 of NIC. Detailed description is given in Box 2.
9 Cities are classified in 6 tiers depending on the population ranging from 100,000 and above to less
than 5000 individuals. Details are accessible at
https://rbidocs.rbi.org.in/rdocs/content/pdfs/100MCA0711_5.pdf [Accessed 14 January 2016].
8
There were a total of 37,175 registered food processing units in India in the year
2011–12, out of which 1,110 were engaged in fruits and vegetables production, 1,695
in dairy production and 140 in meat processing and preservation.10
Table 2 provides
the total number of factories in registered food processing units in the Indian states in
the year 2011–12.
Table 2: Total number of factories in registered food processing units across
states (2011–12)
Name of the State/UT Total
Andhra Pradesh11
9,359
Andaman & Nicobar Islands 4
Assam 1,212
Bihar 715
Chandigarh (UT) 23
Chhattisgarh 1,028
Dadra & Nagar Haveli 8
Daman & Diu 35
Delhi 145
Goa 85
Gujarat 1,924
Haryana 650
Himachal Pradesh 171
Jammu & Kashmir 150
Jharkhand 169
Karnataka 1,979
Kerala 1,437
Madhya Pradesh 754
Maharashtra 3,113
Manipur 18
Meghalaya 18
10
ASI (2012–13). Available at:
http://mospi.nic.in/Mospi_New/upload/asi/ASI_main.htm?status=1&menu_id=88. 11
Here Andhra Pradesh refers to the erstwhile Andhra Pradesh prior to the bifurcation of the state into
Andhra Pradesh and Telangana in 2014.
Box 2: Coverage of Food Processing Sector in the National Industrial Classification
Division 10: ‘Manufacture of Food Products’
Group 101 Processing and preserving of meat
Group 102 Processing and preserving of fish, crustaceans and molluscs
Group 103 Processing and preserving of fruit and vegetables
Group 104 Manufacture of vegetable and animal oils and fats
Group 105 Manufacture of dairy products
Group 106 Manufacture of grain mill products, starches and starch products
Group 107 Manufacture of other food products
Group 108 Manufacture of prepared animal feeds
Source: National Industrial Classification (2008)
9
Nagaland 12
Odisha 875
Puducherry 70
Punjab 2,784
Rajasthan 777
Sikkim 18
Tamil Nadu 5,186
Tripura 55
Uttar Pradesh 2,116
Uttarakhand 381
West Bengal 1,600
Source: Ministry of Food Processing Industries (MoFPI) (2015). p.15, Section 2.1.
Titled: State-wise estimated Number of Factories in Registered FPI units for 2011–12.
Available at:
http://www.mofpi.nic.in/H_Dwld.aspx?KYEwmOL+HGpoo8DlNeKVV3fE4aW5+a
wTGdnZC9kP6Bj7+tZmOXaEjQ== [Accessed 22 December 2015].
It can be seen from Table 2 that the spread of food processing units is non-uniform
across states. Andhra Pradesh12
, Tamil Nadu, Maharashtra and Punjab have the
largest number of food processing units. As evident from Table 1, these are also the
major fruits and vegetables producing states in the country. It is gathered from
various government sources 13
that the total number of registered food processing
units has increased from 36,881in 2011–12 to 37,175 in 2012–13, marking a growth
rate of 0.80 per cent. Table 3 provides the total output of major states and/or union
territories (UT) in the manufacture of food products in 2012–13.
Table 3: Major state/UT contributing at least 80% in terms of total output in the
manufacture of food products [NIC- 10] - 2012–13
State/ UT Total Output
(Rs. lakh)
% Gross Value
Added
(Rs. lakh)
%
Maharashtra 11250931 16.11 841277 12.68
Uttar Pradesh 7868864 11.27 472233 7.12
Gujarat 7259982 10.40 421806 6.36
Karnataka 5405157 7.74 651899 9.83
Andhra Pradesh 5291583 7.58 453428 6.83
Tamil Nadu 4861035 6.96 594116 8.95
Haryana 3950290 5.66 489117 7.37
Madhya Pradesh 3246223 4.65 340493 5.13
West Bengal 3152090 4.51 264722 3.99
Punjab 2882640 4.13 294962 4.45
Rajasthan 2438628 3.49 150276 2.26
All India 69820782 100.00 6634906 100.00
Total of above State/UTs 57607423 82.50 4974329 74.97
12
Here Andhra Pradesh refers to the erstwhile Andhra Pradesh prior to the bifurcation of the state into
Andhra Pradesh and Telangana in 2014. 13
Available at: http://www.makeinindia.com/sector/food-processing [Accessed 22 December 2015].
10
Source: ASI (2012-13), Statement 19. pp.S12-2. Available at:
http://mospi.nic.in/Mospi_New/upload/asi/ASI_main.htm?status=1&menu_id=88
[Accessed 22 December 2015].
Current Cold Chain Infrastructure in India
In India, the cold chain is fragmented and there are several intermediaries involved in
the cold chain. A typical fruits and vegetables cold chain in India for fresh and
processed fruits is illustrated in Figures 2 and 3.
As indicated by Table 1, 2 and 3, the major production, processing and
manufacturing clusters for fruits and vegetable in India are centred around Andhra
Pradesh, Maharashtra, Gujarat, Tamil Nadu and West Bengal. Hence, there is an
opportunity to invest in establishing a cold chain network connecting the
production and processing centres of these states to consumption centres. There are
some states such as Bihar and Madhya Pradesh that are large producers of fruits
and vegetables but do not have a strong manufacturing or processing base. There is
a scope for developing infrastructure in such states for strengthening the
manufacturing base in these states.
11
Figure 2: Typical supply chain from farm to consumer for fresh produce
Figure 3: Typical supply chain from farm to processing to consumer
Small & mid-
sized farmers
Large farmers/
Aggregators
Pack
house
Reefer
Truck
Processing
Unit
Cold
Storage
Reefer
Van
Retail
Outlet
Consumer
Small & mid-
sized farmers
Large farmers/
Aggregators
Pack
house
Reefer
Truck
Cold
Storage
Ripening
Chamber
Mandi
Reefer
Van
Retail
Outlet
Consumer
Reefer
Truck
12
Statistics on the infrastructure available for the cold chain set up in India is provided
by NCCD. There are several infrastructure components of cold chain as depicted in
Figures 2 and 3 include pack-houses, transport vehicles, storage hubs, among others.
The infrastructure components required by a typical food chain along with their
desirable set-up location and current usage are illustrated in Figure 3.
Figure 3: Infrastructure components required to operate a typical cold chain
supply
Source: Created from NCCD and NABCON (2015). Table 2.1. p.13. Available at:
http://www.nccd.gov.in/PDF/CCSG_Final%20Report_Web.pdf [Accessed 30
December 2015].
The cold chain infrastructure in India as on April, 2014 is given in Table 4. The
figures arrived at mainly consider fruits and vegetables and other products that require
cold storage such as high value dairy products (butter, ice-cream) and dried chillies.
Requirements for milk, floriculture and pharmaceutical ingredients have been ignored
in this study.
Food Processing
Unit (PU) Factory dispatch of
food product as
source point
Cluster parks,
production zones
Long Haul Transport
(T)
From pack-house to
Mandi/wholesale
buyer
Across the country
Cold Storage Hubs
(CH)
Close to
consumption/distribu
tion centre
Across the country
Cold Storage Bulk
(CS)
At farm gate/food
processing premises
At farm gate/food
processing premises
Ripening Chamber
(RC)
Close to
consumption/distribu
tion centre premises
Near to consumption
centre
Last Mile Transport
(t)
Within distribution
city Major cities
Retail/ Front-end
(FE) Last mile merchandising
Front end
Modern Pack-houses
(PH)
At farm gate for
fresh produce
preconditioning
For exporters mostly
Infrastructure
Component
Desirable Set-up
Location
Current Usage
13
Table 4: Existing infrastructure – All India (as on April, 2014) – Manufacture of
food products
Infrastructure Component Numbers Capacity (Metric Tonnes)
Modern Pack-house (PH) 249 -
Cold Storage Hubs (CH) 5367 31,823,700
Cold Storage Bulk (CS)
Ripening Chamber (RC) 812 -
Reefer Transport (T)
9,000
54,000 – 135,000
Last Mile Transport (t) < 36,000
Retail/Front-end (FE) 1.968 million outlets -
Note: The enumeration of cold chains in the report has been done only for central
sponsored schemes. Additionally, all calculations are made based on consumption of
the urban population.
Source: NCCD and NABCONS (2015). Table 4.1. p.35. Available at:
http://www.nccd.gov.in/PDF/CCSG_Final%20Report_Web.pdf [Accessed 24
December 2015].
Out of the total 31.82 million metric tonnes of storage capacity created, 10.58 million
tons of storage capacity was created through Central Government Assistance, wherein
the Ministry of Food Processing Industries (MoFPI) created a 0.19 million tonne
capacity, and Mission for Integrated Development of Horticulture, Ministry of
Agriculture (MIDH) comprising National Horticulture Mission (NHM), National
Horticu;lture Board (NHB) and Horticulture Mission for North Eastern and
Himalayan States (HMNEH) created a total of 10.39 million tonne storage capacity.
Disaggregated data on state-wise infrastructure are provided in Table 5.
Table 5: State-wise cold stores created as on April, 2014
State/UTs Number of Cold Storages Size in MT
Andaman & Nicobar (UT) 2 210
Andhra Pradesh14
404 15,77,828
Arunachal Pradesh 2 5,000
Assam 34 1,19,652
Bihar 303 14,06,395
Chandigarh (UT) 6 12,216
Chhattisgarh 89 4,27,766
Delhi 97 1,29,857
Goa 29 7,705
Gujarat 560 20,30,873
Haryana 295 5,88,649
Himachal Pradesh 32 38,557
Jammu and Kashmir 28 64,769
Jharkhand 55 2,17,280
Karnataka 189 5,26,752
14
Here Andhra Pradesh refers to the erstwhile Andhra Pradesh prior to the bifurcation of the state into
Andhra Pradesh and Telangana in 2014.
14
Kerala 197 78,355
Lakshadweep (UT) 1 15
Madhya Pradesh 260 10,97,168
Maharashtra 540 7,06,302.6
Manipur 1 2,175
Meghalaya 4 8,200
Mizoram 3 3,931
Nagaland 2 6,150
Odisha 111 3,26,639
Puducherry (UT) 3 85
Punjab 606 20,04,778
Rajasthan 154 4,80,032
Sikkim 2 2,000
Tamil Nadu 163 2,95,671
Tripura 13 39,181
Uttar Pradesh 2,176 1,36,33,039
Uttarakhand 28 84,545
West Bengal 502 59,01,925
Total 6,891 3,18,23,700.6
Source: NCCD and NABCONS (2015). Annexure VI. p.118. Available at:
http://www.nccd.gov.in/PDF/CCSG_Final%20Report_Web.pdf [Accessed 24
December 2015].
Agricultural and Processed Food Products Export Development Authority (APEDA)
has generated a list of 143 recognised pack-houses for fruits and vegetables in the
country which are mainly used for exports. This leads us to assess the current shortage
and hence identify the areas where cold chain infrastructure is required.
Cold Chain Infrastructure Required
The overall cold chain infrastructure requirement is derived by looking at the
consumption demand. NCCD (2015) has made an assessment, which is presented in
Table 6.
Table 6: Infrastructure Requirement – All India (as on April, 2014)
It can be seen from the above tables that the establishment of cold chain
infrastructure has been non-uniform across the states, with Uttar Pradesh, West
Bengal and Gujarat having the largest storage capacities, while the north-eastern
states of Sikkim, Manipur and Mizoram have the smallest storage capacities.
15
Infrastructure Component Numbers Holding Capacity/Storage Size
Pack-house 70,080 11,21,274 MT
Cold Storage (Bulk) - 341,64,411 MT
Cold Storage (Hub) - 9,36,251 MT
Reefer Vehicles 61,826 4,94,608 MT
Ripening Chamber 9,131 91,306 MT
Onion Storage Structure 2,80,241 70,06,028 MT
Source: NCCD (2015). Table 6.6. p.86. Available at:
http://www.nccd.gov.in/PDF/CCSG_Final%20Report_Web.pdf [Accessed 24
December 2015].
The disaggregated state-wise data are presented in Table 7.
Table 7: State-wise cold chain infrastructure requirement
State Pack-
house
(Numbers)
CS Bulk
(Metric
Tonne)
CS Hub
(Metric
Tonne)
Onion
Storage
(Metric
Tonne)
Ripening
Chamber
(Metric
Tonne)
Andhra
Pradesh
3124 489195 41730 551273 4070
Arunachal 60 6705 803 -- 78
Assam 809 61185 10811 -- 1054
Bihar 2205 5094524 29458 155936 2873
Chhattisgarh 1131 498724 15106 -- 1473
Delhi 3003 -- 40122 -- 3913
Goa 170 -- 2271 -- 221
Gujarat 4835 2174886 64590 305066 6299
Haryana 1695 217754 22641 305686 2208
Himachal
Pradesh
122 304511 1636 -- 160
Jammu and
Kashmir
645 899220 8622 -- 841
Jharkhand 1476 5228 19723 -- 1923
Karnataka 4388 151695 58618 809817 5717
Kerala 3361 968 44906 -- 4379
Madhya
Pradesh
3671 1818134 49045 1130550 4783
Maharashtra 9245 34200 123509 3063522 12045
Manipur 160 2925 2137 -- 208
Meghalaya 110 17228 1476 -- 144
Mizoram 106 7508 1412 -- 138
Nagaland 115 7142 1533 -- 149
Odisha 1285 288328 17172 -- 1675
Punjab 1903 1667984 25424 -- 2479
Rajasthan 3146 11370 42025 337343 4098
Sikkim 36 2145 476 -- 46
Tamil Nadu 6410 109005 85635 -- 8351
16
Telangana 2171 248130 28999 442517 2828
Tripura 197 5925 2629 -- 256
Uttar Pradesh 8206 10565506 109631 72945 10691
Uttarakhand 578 65208 7723 273893 753
West Bengal 5378 9409081 71848 -- 7007
UT & Others 340 4539 443
All-India
Urban
70080 34164411 936251 7448545 91306
Source: NCCD and NABCONS (2015). Annexure XIV. p.129. Available at:
http://www.nccd.gov.in/PDF/CCSG_Final%20Report_Web.pdf [Accessed 24
December 2015].
Potential Areas for Investment in Cold Chain Grid
The above analysis highlights that the cold chain infrastructure is not uniform across
the country. Existing studies point out that a significant proportion of the perishable
produce transported on a daily basis moves via the non-reefer mode (NCCD 2015).
Globally, cold chain networks are developed by the private investors while the
government acts as a facilitator and may provide certain fiscal and non-fiscal
incentives.
In India, cold chain is a priority sector for the government and several incentives are
offered by the government to attract private and foreign investments (see Table 8).
Analysing areas lacking investment in infrastructure by type and location can provide
an idea of potential areas for private investment in the cold chain grid in India. It is
also important to note that there is a need for private investments in some states such
as Bihar and Madhya Pradesh since these are large production centres and private
investors may look at these states for future investments. The private sector should
examine the project viability and invest in states where infrastructure is poorly
developed.
Table 8: Various government incentives provided for setting up cold stores in the
country
Government Agency Financial Support Provided
National Horticulture Board (NHB) Back-ended subsidy of 40% of the project
cost at the rate of Rs 6000 per Metric
Tonne (MT) for normal cold storages; at
the rate of Rs 7000 and Rs 8000 per MT
for specialised cold storages; and at the
rate of Rs 32,000 per MT for Controlled
Atmosphere storages.
Agricultural & Processed Food
Products Export Development
Authority (APEDA)
100% grant-in-aid for establishment of
common infrastructure facilities.
25% subsidy subject to a ceiling of Rs 10
lakh per beneficiary for setting up
specialised storage facilities such as CA,
deep freezers, etc.
Department of Agriculture and
Cooperation (DAC)
Credit linked back-ended subsidy of 40%
(general states) and 55% (hilly and
17
scheduled states) of capital cost of the
project for a maximum storage capacity of
5000 MT per project at the rate of Rs 6000
per MT.
Rs 32,000 per MT for 5000 MT in case of
CA storages.
National Co-operative Development
Corporation (NCDC)
Subsidy at the rate of 20% and 25% of the
project cost for Under Developed (UD)
and Least Developed (LD) states for
setting up of new cold storages,
CA/Modified Atmosphere (MA) stores,
expansion/modernisation of existing cold
storages with sorting and pre-cooling
facilities.
Source: Extracted from “NCCD Conclave with Nodal Officers for Cold chain
Development”. Available at: http://www.nccd.gov.in/PDF/Mofpi.pdf [Accessed 30
December 2015].
There are areas such as the cold storage facilities wherein the infrastructure is
reaching near saturation; while there are other areas in the cold chain such as pack-
houses, reefer vehicles and refrigeration at last-mile retail outlets such as push-carts,
head loads and street vendors, where infrastructure is far lower than the requirement.
One of the reasons for low investment in segments like the pack-houses is that unless
they are meant for exports, businesses do not find them profitable. Therefore, the
government can encourage investments in these by incentivising the investors through
subsidies and tax exemptions for projects that appear financially non-viable.
Investments should be encouraged to link the production centres with the cold stores
to minimise losses in transit from farm to consumer. This can also be facilitated by
greater linkage between the Mega Perishable Centres and Perishable Cargo Centres to
be developed along the National Green Grid as proposed by the Task Force.
There are certain potential areas for foreign investment. For instance, investors can
start with the economic corridors such as the Delhi-Mumbai Industrial Corridor or the
Amritsar-Delhi-Kolkata Industrial Corridor. Necessary integration of operational and
proposed cold chain systems along the corridors can start by linking roads, railways,
inland waterways (for the domestic market) and the port cities/airports (for export
purposes) can help in integrating the cold chain infrastructure in some parts of the
country. This is on the lines of the suggestions made by the Task Force.
Scope for technical collaboration exists between Indian and foreign companies and
foreign investments in clean and renewable sources of energy for running cold storage
infrastructure, reefer vehicles, etc. Greater fuel efficiency in transportation and use of
solar panels to power cold stores in states such as Rajasthan can be beneficial for
India.
At present, the cold chain infrastructure is fragmented and it is difficult for food
manufacturers and retailers to identify the best and most competitive cold chain
service providers. Most of the service providers rely on captive clients. To make the
industry more competitive and help the small players to link into the cold chain
network, the government can develop a virtual network wherein the government
18
through an information technology (IT) based system can provide an availability map
of the present cold chain infrastructure. NCCD is trying to create a database of the
different cold chain service providers across the country. This will help to virtually
integrate the cold chain network and bring together the service providers and the
businesses. This will also facilitate easier tracking of cold chain infrastructure, prices
offered by different players, availability of space, etc. A number of private players are
developing software to track the cold chain infrastructure.
Last but not the least, if the Indian government implements the single goods and
services tax in 2016, the cold chain infrastructure is likely to get integrated with hub-
and-spoke model. This will create new investment opportunities for foreign players in
areas ranging from infrastructure to technology and services.
19
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