Non-Capital-Intensive, Technological Inputs Needed For MSME Food Processing Sector: P.L. Kaul, Chairman & MD, Mariental India Pvt Ltd

The MSMEs in the food processing sector can play a key role in helping the economy transition from agricultural work to highly skilled jobs and stimulate employment generation. Given its importance, there is a strong case for increasing government support to the MSMEs in the food processing sector. During the second day of World Food India 2017, at a session called “MSME Food Processing Sector: Global Opportunities”, moderated by P.L. Kaul, Chairman and Managing Director, Mariental India Private Ltd, various dimensions and opportunities in the MSME sector.

“The MSME sector is extremely strong. Two miracles have happened in the past, one is the Green Revolution where production went up from 74 million metric tons to 131 million metric tons from 1967 to 1978. The second miracle was the Operation Flood, as we are now boasting we are the largest producers of milk. We have people who are very intelligent despite education levels, and that is the strength of India. We now boast of having companies where small, then medium and are now global companies. Almost 85% of all processed food comes from MSME sector. Even products marketed by MNCs today are sourced from the MSME sector”, said Kaul, adding that “58% of rural households depend on agriculture and generate 50% of employment. Finance is a matter of concern for the MSME sector but I am sure that there will be new avenues of finance for the sector. Our goal should be to maximize production, enhance quality and enhance efficiency. So our endeavour should be how to grow more, maximize processing and minimize wastage. If the sector has to come up, we need technological inputs which are not capital intensive.”

Peter Ravensbergen, Programme Leader, Food Security, Business Developer, Sustainable Fresh Chains & Post-harvest Network, Wageningen Food & Bio-based Research gave an interesting presentation on his suggestions and innovations to improve the food processing sector. “I am the son of a small farmer. Netherlands has historically always had small holdings, and the key to that is cooperation and collaboration to create economies of scale and reach new markets. We at Wageningen University want to look at the impact to transform the lives of producers, processors, consumers. We need to improve supply chain and increase awareness amongst the consumer not to throw away the food. We have to look at agro-logistics and post-harvest quality. The environment and conditions of the supply chain, management of supply chain and the physics and physiology of the chain are important to investigate and improve. In the end, it is about efficient supply chains which are demand driven. That requires close cooperation, trust and skills to work together in the supply chain”, said Ravensbergen.

He also added, “When it comes to supply chain improvement, what’s important is the technology, the hardware, the org-ware (institutional developments and alliances) and the software. There has to be an integrated approach for supply chains. We have developed practical solutions like next-generation storage technology, new sensors and an interactive ware-house system, tracking and tracing within the supply chain, an extension of shelf-life, vision and robotics. Very important is also the circular economy. What we can do to prevent, reduce, reuse and recycle. We also have some specific training working to strengthen the knowledge base and capacity. It is all about consumer’s preferences and satisfying it.”

Raghav N. Jadli, Managing Director, Jadli Foods Pvt Ltd said, “Without raw material, the industry will not run. It is very important to save food during season time. We pack food naturally and keep it as natural in the form of pulp and concentrate. We are an intermediary between the food and the farmer. We don’t see a large market size for milk packaging and branding. There is a misconception that processed food is junk food. Even food cooked at home is processed food.” He also went on to add, “The consumer mentality with the processed food has some sort of reservations, and there is a requirement of better branding. I also suggest that there should be some sort of authentication from the government’s side, so the real taste of Indian food reaches the people, authentic food should be marketed and produced better.”

Anurit Kanti

BW Reporters The author is correspondent at BW Businessworld, he has a keen interest in sustainability and environmental economics