30 September 2024 : Indian Express Editorial Analysis

1. UNLOCKING THE RETAIL ADVANTAGE       

(Source: Indian Express; Section: The Editorial Page; Page: 12)

Topic: GS3– Indian Economy

Context:

The article discusses India’s transformative retail and e-commerce growth, emphasizing the critical role of logistics, supply chain efficiency, and technological advancements in achieving economic and sustainable development goals.

India at the Brink of Retail and E-commerce Transformation

• India is on the verge of a transformative period, particularly in the retail and e-commerce sectors. With a rapidly expanding middle class, increasing disposable incomes, and a youthful population, the nation’s retail market is expected to surge from $820 billion in 2023 to an impressive $2 trillion by 2033.
• E-commerce plays a critical role in this revolution, driven by rapid digitalization and greater internet penetration, positioning the Indian e-commerce market to reach $325 billion by 2030.
• These dynamics indicate that India is entering a new era of consumerism, marked by convenience, variety, and affordability for a large swath of its population.

The Role of Logistics in Sustaining Retail Growth

• However, the foundation of this booming retail and e-commerce growth lies in the country’s logistics and supply chain infrastructure. As India aims to achieve a $5 trillion economy by 2030, the efficient movement of goods is essential for keeping pace with consumer demand.
• Presently, India’s logistics costs are relatively high, accounting for 11-14% of its Gross Domestic Product (GDP), compared to the global average of 8-10%. In the US and Europe, logistics costs amount to about 8-10%, while in China, it’s around 9%.
• Reducing logistics costs is a key priority, as it would lead to more competitive pricing, better profit margins for retailers, and ultimately, more affordable products for consumers.

The National Logistics Policy and Future Projections

• The Indian government has recognized the importance of reducing logistics costs and improving supply chain efficiency. The National Logistics Policy (NLP) aims to address these issues by developing a comprehensive framework that enhances the country’s logistics performance.
• The policy promotes standardization, encourages investments, and fosters innovation, all of which are pivotal in building a more efficient logistics ecosystem.
• Notably, India’s logistics sector is expected to grow by 8.8% annually, reaching $484.43 billion by 2029. This will contribute to the nation’s broader economic goals, as India has already moved up six places to 38th in the World Bank’s Logistics Performance Index in 2023.

Digital Transformation and the Future of Indian Logistics

• Digitization is a key focus of the NLP, as it offers a pathway to streamline logistics processes through technology. Real-time tracking, e-documentation, and seamless data exchange can help reduce delays and inefficiencies.
• The development of the Unified Logistics Interface Platform (ULIP) is another major initiative aimed at bringing all stakeholders onto a single platform for better coordination.
• Technology, such as the Internet of Things (IoT), Artificial Intelligence (AI), and data analytics, will be pivotal in optimizing logistics operations and enhancing predictability and reliability.

Sustainability in Logistics

• Sustainability is another critical focus for the future of Indian logistics. Practices such as the adoption of electric vehicles, energy-efficient warehousing, and sustainable packaging are integral to reducing the sector’s environmental footprint.
• By integrating eco-friendly practices, India can align its logistics growth with global environmental standards while reducing operational costs.

Learning from Global Best Practices: The German Model

• Countries like Germany, with its renowned logistics sector, offer valuable lessons for India. Germany’s model emphasizes seamless integration of multiple transportation modes, advanced technology use, and skilled workforce training, all supported by efficient infrastructure.
• Digital technologies like IoT, AI, and data analytics play a significant role in enhancing logistics predictability and reliability. By following Germany’s lead, India can focus on upgrading its logistics infrastructure and integrating technology at every step of the supply chain.

Importance of Skilled Workforce and Technological Integration

• A skilled workforce is essential for managing the advanced systems and technologies that are transforming logistics. The Gati Shakti National Master Plan emphasizes the need for formal education and training programs for logistics professionals, ensuring a capable workforce that can support the sector’s future growth.
• Partnerships with educational institutions and industry bodies can enhance skill development, ensuring that India’s logistics sector is well-equipped to handle the demands of a rapidly growing economy.

Conclusion: Towards a Viksit Bharat 2047

• A robust logistics ecosystem is vital not just for economic growth but also for enhancing the standard of living for millions of Indians. As India aims to become a hub for international trade by leveraging its strategic location between East and West, the logistics sector will play a critical role in this transition.
• By adopting global best practices, investing in infrastructure, fostering technological innovation, and nurturing a skilled workforce, India can unlock the full potential of its retail and logistics sectors, propelling the country towards its vision of Viksit Bharat 2047—a developed and prosperous India.

What are the Government Initiatives Related to the E-Commerce Sector in India?

FDI Policy: 100% FDI is allowed in B2B e-commerce. Also, 100% FDI under the automatic route is permitted in the marketplace model of e-commerce. National E-Commerce Policy: The Indian government is set to introduce a national e-commerce policy that aims to create a favourable environment for the development of the sector and drive exports. Open Network for Digital Commerce (ONDC): This initiative fosters an open-source e-commerce network that connects consumers, platforms, and retailers, promoting transparency and interoperability. The Consumer Protection (e-commerce) Rules, 2020. The Rules directed the e-commerce companies to display the country of origin alongside the product listings. Digital India initiative: The Digital India initiative has provided solid impetus to other government-led initiatives, including UMANG, Start Up India and Aatmanirbhar Bharat, which have great potential to translate into global success. India Stack: This initiative comprises a set of open APIs (Application Programming Interfaces) that enable government agencies, businesses, and developers to leverage digital infrastructure for various services, including e-commerce. BharatNet Project: Aims to provide internet connectivity in local bodies (Panchayats), increasing e-commerce reach in rural areas.

Practice Question:  India’s retail and e-commerce sectors are poised for significant growth, but high logistics costs and infrastructure challenges remain major hurdles. Discuss the role of the National Logistics Policy (NLP) in addressing these challenges and how integrating technology and sustainability can help India achieve its economic goals. (250 words/15 m)

2. Food that doesn’t feed

(Source: Indian Express; Section: The Ideas Page; Page: 13)

Topic: GS2– Social Justice – Food Security

Context:

The article emphasizes the urgent need to reduce food loss and waste (FLW) in India and globally, highlighting its potential to address hunger, improve food security, and contribute to environmental sustainability.

Significance of the International Day of Awareness of Food Loss and Waste

• The United Nations has designated September 29 as the International Day of Awareness of Food Loss and Waste (FLW), recognizing the critical importance of addressing these issues for both food security and environmental sustainability.
• Jointly led by the Food and Agriculture Organisation (FAO) and the United Nations Environment Programme (UNEP), this day highlights how reducing food loss and waste can feed millions of hungry people and contribute to achieving the United Nations’ Sustainable Development Goals (SDGs).
• According to a 2023 FAO report, about 13.2% of global food production is lost between harvest and retail, while UNEP estimates that 17% is wasted between retail and consumption.
• Together, food loss and waste account for nearly 30% of global food production, representing an opportunity to significantly reduce hunger and greenhouse gas (GHG) emissions if addressed effectively.

India’s Challenge: Post-Harvest Losses and Food Waste

• India faces a significant challenge in food loss and waste. According to a 2022 survey by NABCONS, the country loses food worth ₹1.53 trillion ($18.5 billion) annually.
• This includes 12.5 million metric tons (MMT) of cereals, 2.11 MMT of oilseeds, and 1.37 MMT of pulses. Additionally, 49.9 MMT of horticultural crops are lost each year due to inadequate cold chain infrastructure, which not only reduces the availability of fresh produce but also impacts farmers’ incomes.
• While these estimates focus on post-harvest losses, significant wastage at the consumer level, such as in weddings and feasts, further exacerbates the problem.

Technological Interventions to Reduce Food Losses

• Technological interventions across the agricultural value chain are critical to reducing food losses between harvest and retail. Research by ICRIER-ADMI in 2022, which surveyed 1,200 farmers across Punjab, Bihar, and Madhya Pradesh, highlighted post-harvest losses in key crops like soybean, wheat, paddy, and maize.
• The findings revealed that soybean has the highest post-harvest loss at 15.34%, followed by wheat (7.87%), paddy (6.37%), and maize (5.95%).
• These losses occur primarily due to low mechanization levels and inadequate logistics infrastructure. For example, using combine harvesters significantly reduces losses in paddy compared to traditional manual methods.

Mechanization and Storage Infrastructure

• Mechanization plays a pivotal role in reducing post-harvest losses. For instance, while 97% of paddy-producing households in Punjab use combine harvesters, only 10% do so in Bihar.
• This disparity highlights the need for Farmer Producer Organisations (FPOs) and Custom Hiring Centres (CHCs) to facilitate group leasing of machinery, making advanced technology accessible to small and marginal farmers.
• Additionally, improving drying and storage infrastructure is essential. Traditional sun-drying methods, prone to contamination and moisture damage, can be replaced with solar dryers and dehydrators, which are climate-friendly and cost-effective for small-scale farmers.

Expanding Storage Capacity and the Government’s Role

• India also suffers from inadequate storage infrastructure, contributing to about 10% of total food grain production losses, according to a 2021 report by IGSMRI.
• Recognizing this, the Government of India has launched a plan to expand storage capacity by 70 MMT over the next five years. If implemented effectively, this initiative could significantly reduce post-harvest losses during storage.
• Additionally, the Jute Packaging Material Act (JPMA, 1987), which mandates using jute bags for rice and wheat storage, needs to be revisited. While jute is biodegradable, it has several downsides, including high water usage and vulnerability to rodent attacks. Alternatives like airtight bags could lower storage and transit losses.

Policy Support and the Need for Change

• While technology can drive improvements, policy support is essential to ensure that small and marginal farmers benefit from these advancements. The role of FPOs and CHCs in providing access to mechanization is crucial.
• Furthermore, promoting green technologies like solar dryers and investing in modern storage solutions will enhance the resilience of India’s food systems.
• Reducing food loss and waste is not just about improving economic efficiency but also about addressing malnutrition, food security, and climate change.

Conclusion: Saving People and the Planet

• Reducing food loss and waste (FLW) is a critical challenge for India and the world. With climate change and malnutrition posing serious threats, focusing on post-harvest loss reduction is key to feeding more people, improving farmer incomes, and mitigating environmental impact.
• By enhancing mechanization, upgrading storage infrastructure, and implementing supportive policies, India can play a significant role in addressing global FLW and achieving the United Nations’ Sustainable Development Goals.

What are the Key Efforts Related to Food Loss and Waste?

Constitutional Provision: Though the Indian Constitution does not have any explicit provision regarding the right to food, the fundamental right to life enshrined in Article 21 of the Constitution can be interpreted to include the right to live with human dignity, which may include the right to food and other basic necessities. Buffer Stock: Food Corporation of India (FCI) has the prime responsibility of procuring the food grains at minimum support price (MSP) and stored in its warehouses at different locations and from there it is supplied to the state governments in terms of requirement. National Food Security Act, 2013 (NFSA): It marks a paradigm shift in the approach to food security from welfare to rights-based approach. NFSA covers 75% of the rural population and 50% of the urban population under: Antyodaya Anna Yojana: It constitutes the poorest-of-the-poor, who are entitled to receive 35 kg of foodgrains per household per month. Priority Households (PHH): Households covered under PHH category are entitled to receive 5 kg of foodgrains per person per month.

PYQ: What are the salient features of the National Food Security Act, 2013? How has the Food Security Bill helped in eliminating hunger and malnutrition in India? (250 words/15m) (UPSC CSE (M) GS-3 2021)

Practice Question:  Food loss and waste (FLW) pose significant challenges to food security and environmental sustainability in India. Discuss the major causes of post-harvest losses in the country and suggest measures to reduce these losses while ensuring sustainable agricultural practices. (250 words/15 m)