Un­shack­ling the cold chain in­dus­try

Na­tional Cen­ter for Cold Chain Devel­op­ment (NCCD) is an au­ton­o­mous body es­tab­lished by the Gov­ern­ment of In­dia with an agenda to pro­mote cold-chain sec­tor in the coun­try. Pawanexh Kohli, CEO & Chief Ad­vi­sor, NCCD talks about the nitty-gritty of this secto

Cargo Talk - - Front Page - KALPANA LOHUMI

Q Could you throw some light on the ini­tia­tives un­der­taken by NCCD for the devel­op­ment of cold chain in­fra­struc­ture in In­dia?

NCCD has been fre­quently propos­ing and con­tem­plat­ing ideas on how to cre­ate more busi­ness op­por­tu­ni­ties in the cold chain seg­ment. This of course also means re­defin­ing the busi­ness con­cepts, mov­ing the per­cep­tion away from mere space rental mod­els to one based as a sup­ply chain in­ter­ven­tion. We brought aware­ness on all the ma­jor miss­ing com­po­nents in the lo­gis­tics frame­work and guided them into gov­ern­ment pro­grammes and schemes. The ma­jor­ity of such rec­om­men­da­tions have been adopted in var­i­ous pol­icy ini­tia­tives for the next phase of cold chain devel­op­ment. A toll-free num­ber has been pro­vided for reefer trans­porters to record en-route bot­tle­necks. On an in­ter­na­tional level we are col­lab­o­rat­ing with al­lied agen­cies for im­proved knowl­edge shar­ing. More­over, con­duct­ing the first of its kind train­ing pro­grams, both in­ter­na­tional and do­mes­tic, is an­other spe­cial ini­tia­tive by NCCD.

As a part of gov­ern­ment pol­icy di­rec­tion, en­ergy ef­fi­ciency and the green­ing of cold chain is an­other op­por­tu­nity pro­moted by NCCD. Tech­nolo­gies and sys­tem stan­dards that min­imise en­ergy con­sump­tion, while pro­mot­ing al­ter­nate and hy­brid ap­pli­ca­tions are now part of gov­ern­ment sup­port struc­ture. Hav­ing mod­ern stag­ing pack houses at vil­lage level is a thrust item, and is a strate­gic in­clu­sion in the re­cently re­vised sup­port schemes.

The NCCD has helped de­velop guide­lines for the min­i­mum sys­tem stan­dards that will be ap­pli­ca­ble when seek­ing gov­ern­ment fi­nan­cial sup­port. Th­ese were de­vel­oped so as not to spec­ify in­di­vid­ual equip­ment de­signs and spec­i­fi­ca­tions but to give di­rec­tion to­wards use­ful so­lu­tions. The ra­tio­nal­i­sa­tion of gov­ern­ment schemes will help re­de­fine the en­tire con­cept of cold chain i.e. move it away from be­ing per­ceived as only static cold stor­age to a dy­namic sup­ply chain which serves as a pipe­line for ef­fec­tive and use­ful flow of fresh foods, dairy pro­duce, med­i­cal goods and other food prod­ucts.

Q Ac­cord­ing to you, what are the fac­tors that will fa­cil­i­tate the ef­fec­tive func­tion­ing of the cold chain in­dus­try?

Fund­ing of cost ef­fec­tive projects and bet­ter and more ef­fec­tive op­er­a­tional equip­ment can be brought into use as key fac­tors. To­wards this, the bud­getary al­lo­ca­tion of ` 5,000 crore as the ware­hous­ing in­fra­struc­ture fund, was made open ended for all com­po­nents com­ing un­der cold chain wherein not just cold ware­houses but reefer trucks, pre-cool­ers and pack houses could avail the ben­e­fit of this fund. This fund man­i­fests as a low in­ter­est loan, avail­able through NABARD, and can be availed di­rectly by all pri­vate en­ti­ties.

In­dia has de­clared cold chain as a thrust area since we are also the world's largest fresh whole food con­sumers and with an equally large farm­ing so­ci­ety cold chain is in it­self the great­est value-ad­di­tion for per­ish­able crops, since with cor­rect use, it pro­vides ac­cess to mar­ket as well a choice of mar­kets to the farm­ers. Proper use of cold chain is an­other key fac­tor. Here, busi­ness play­ers need to un­der­stand that cold chain is about the busi­ness of food. Hence, se­cur­ing the source and its mar­ket link­age is a key to their ac­cess. Se­lect­ing the right set of in­fra­struc­ture com­po­nents be­comes im­por­tant to the busi­ness model. A cold store is only a mid­dle link for those who sup­ply food, and to cap­ture more value in the chain, those who cre­ate pack houses will find them­selves as lead­ers in the race to cre­ate wealth. It’s time to move away from a mind­set that be­lieves in stor­ing food - it is of no use to hoard per­ish­able prod­ucts if such in­ter­ven­tion does not open ac­cess to more and newer mar­kets. For this, the next ma­jor fac­tor is trans­port link­age.

We are tak­ing In­dia to­wards a fu­ture ready food dis­tri­bu­tion sys­tem. Once our do­mes­tic dis­tri­bu­tion is rec­ti­fied, we will find our­selves in a state of plen­ti­ful. The ex­cess pro­duc­tion that is wasted will be use­ful sur­plus and we will then need ac­cess to mar­kets out­side In­dia. Thus, the ma­jor thrust area headed for this is de­vel­op­ing per­ish­able gate­ways at sea ports. The need is al­ready pal­pa­ble.

An­other key fac­tor is hav­ing in­te­grated lo­gis­tics play­ers in this field those who can re­alise that this is the only sphere where a lo­gis­tics provider can trans­form into the pri­mary value provider. In­dus­try has to re­alise the strate­gic ad­van­tage of be­ing in the food dis­tri­bu­tion busi­ness and the le­gacy they can es­tab­lish. In the fresh food trade, the sup­ply chain di­rectly im­pacts the value re­al­i­sa­tion, more than the source or fac­tory. But for that we are lack­ing vi­sion­ary lead­er­ship in this sec­tor. In­stead of wait­ing for gov­ern­ment pol­icy to drape them, a busi­ness leader has to recog­nise and seize the clearly ev­i­dent de­mand sup­ply op­por­tu­nity.

(The sec­ond and fi­nal part of this in­ter­view will ap­pear in the March edi­tion of CARGOTALK)

CEO & Chief Ad­vi­sor, Na­tional Cen­tre for Cold Chain Devel­op­ment (NCCD)

Pawanexh Kohli

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