Farmers to gain from retail food revolution

The farmers will greatly benefit from the revolution in the food retail space, said Limji Nanabhoy a director of the Agri-Science India.

He was speaking to the business standard on the sidelines of the conference organised by Bombay Chamber of Commerce and Industries, on 'Opportunities in Organised Food Retailing'.

Nanabhoy said, "In present system farmer has no incentive to produce quality product as at the end of the day he is going to get the price whatever price is relevant in the market. Nobody is going to ask what is quality of his product, whether he is using 'good' farming practices on his farm etc. But once food retail starts taking place in India in organised sector and on large scale, these super markets or convenience stores will be interested in sourcing their produce directly from farmers rather than buying them from middlemen".

These stores would want to enter into an agreement with the farmers, for particular quality and quantity of products as they want assured supply of that particular product, Nanabhoy added. This will ensure farmers of steady income from their produce. As of now they don't know their onion is going to fetch Re 1 per kg or Rs 5 per kg, he pointed out.

Another fall out of this development is going to be that, consumers also will get best value for their money as they will be assured about certain quality of the product, they will have better shopping experience, all products will be available under once roof, he claimed.

Speaking at the seminar Pankaj Gupta, practice head, Tata Strategic Management Group, said, "Organised food retailing business is next sunrise industry in India and it is going to grow from around present level of Rs 2,500 to Rs 3,000 crore a year to Rs 1.15 lakh crore a year by 2015.

The paper published by the Bombay chamber and ministry of food processing Industries also highlights the fact that, organised food retail in India is currently pegged at around Rs 2500-3000 crore and over next five years it is going to grow by around 30 per cent, attracting lot of corporate investment in this sector.

The document also points out that, retail trade in China was open to foreign direct investment in 1994, since then organised food retailing sector has increased from $38 billion to $55.13 billion.