Which of the following is a supply-side bottleneck for the growth of the food processing sector in India?

Solution

The food processing industry in India is growing at a rapid pace, but the lack of adequate and efficient cold chain infrastructure is a major supply-side bottleneck for its growth. Cold chain infrastructure includes storage, transportation, and distribution facilities that are necessary to maintain the quality and safety of perishable food products, such as fruits, vegetables, dairy, and meat products. In India, a significant portion of perishable produce is lost due to inadequate cold storage facilities and transportation systems. The existing cold storage infrastructure is unevenly distributed, with most of the facilities concentrated in a few states and cities, which makes it difficult for farmers and food processors to access them. Furthermore, the quality of the existing cold storage infrastructure is often poor, resulting in product spoilage and wastage. The lack of efficient connectivity and logistical barriers also pose challenges to the growth of the food processing sector. For instance, poor road infrastructure and inadequate transportation facilities can increase the time and cost of transporting perishable products from the farm to the processing facility or market, thereby reducing the quality and shelf-life of the products. However, the lack of demand for processed food items in the consumer basket is not a supply-side bottleneck. Rather, it is a demand-side constraint that can be addressed through effective marketing and consumer education initiatives. Hence, option A is correct.