Farm-fresh ideas to tackle food supply chain niggles

The Economic Survey has suggested several options to address supply side problems on the food front and has backed the idea of regular imports of small quantities of agriculture commodities.
It has said the compositional shift in the food basket of a common household has increased the demand for some food items and there are supply side constraints which were exposed during the recent spike in food inflation, particularly prices of vegetables and fruits.Near doubledigit food inflation emerged as a major policy headache for the UPA government in the past year. It has eased significantly in recent weeks much to the relief of policymakers but has once again shown signs of inching up.
“As a strategy, regular imports of agriculture commodities in relatively smaller quantities with an upper ceiling on total quantity could be considered. The upper ceiling can be decided annually, relatively well in advance, after assessing the likely domestic situation in terms of production and consumption requirements ,” the survey said.
Even as the survey listed the features of the proposed National Food Security Bill, it pushed the case for increasing direct cash transfers and suggested that the government should get out of the ‘supply side’ and distribution of grains as the PDS was an extremely inefficient way of delivery. The survey called for setting up special markets for special crops in states/regions /areas producing those crops saying it would facilitate supply of superior commodities to consumers. It also suggested a greater number of traders to be allowed as agents in mandis. It added that perishable food items could be taken out of the ambit of the APMC Act.
It said in order to promote interstate trade, a commodity for which market fee has been paid once must not be subjected to subsequent market fee in other markets. The survey said storage capacity was a major problem facing the country and recommended public-private-partnership models.
It called for linking farmers to the market and also reiterated the need for investment in food processing, cold chains, handling and packaging processed foods.
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