By: Ashish Khandelwal, Managing Director, BL Agro
With a 1.47 billion mouth to feed, India is the world’s largest producer of milk, fruits, vegetables, spices, and cereals. But for decades, one uncomfortable paradox has defined its food economy. There is an abundance at source, but with that also comes an alarming waste before food ever reaches a plate.
As per industry estimates, there is a 15 to 35 percent post-harvest loss depending on the commodity. This is a staggering drain on farmer income, national resources, and food security. However, in the last 3-5 years, we have witnessed a rise in technological solutions and policy implications in the food processing industry that is now addressing this fundamental problem that will also solve the issue of food security. The scale and speed of this transformation are yet to pick up the desired speed, but nonetheless, the efforts made are remarkable.
India’s food processing sector contributes roughly 8–9 percent of GDP from agriculture and remains one of the largest employers in manufacturing. But despite its significant contribution, the food processing industry has largely been dominated by small informal units working with minimal mechanisation, broken cold chain infrastructure, and limited access to quality-control systems.
I believe if four things come together, India’s food processing industry will change by leaps and bounds:
- Automation & Smart Manufacturing: We are living in the age of AI, and it is high time for the food processing industry to embrace it with open arms. Deploying robotics, IoT-enabled machinery, and AI-driven production lines will significantly reduce manual dependency, minimise contamination risks, and improve output consistency. Large players in the poultry, dairy, snacking, and ready-to-eat meals have already fast-tracked automation through significant investments in automated sorting, grading, filling, sealing, and packaging lines. We are witnessing new technologies like machine vision systems, cameras paired with AI algorithms now inspect produce for size, colour, surface defects, and foreign matter at speeds no human workforce could match. These also help in simultaneously generating quality data that feeds back into procurement and supplier management.
- Cold Chain & Post-Harvest Technology: One of the most important sectors that should benefit due to technological advancements in the cold chain sector. Industry data suggests that we lose around ₹90,000 crore worth of food annually due to poor cold chain infrastructure. But I think that would now be history as emerging technologies like IoT-monitored cold storage, solar-powered refrigeration units for rural areas, and blockchain-enabled cold chain tracking will dramatically cut post-harvest losses for perishables like fruits, vegetables, fish, and milk. Solar-powered cold storage units, designed for off-grid rural deployment, have already begun extending preservation capability to farm clusters that previously had no viable option between harvesting and transportation. RFID and GPS integration allows end-to-end visibility from farm gate to retail shelf.
- AI and Data Analytics For Demand Forecasting: The biggest beneficiary of the emergence of AI and data analytics would be demand forecasting. This will go a long way in ensuring food security for a nation of a billion-plus people. We have to ensure that AI and data intelligence is embedded in the food processing value chain.
This will boost the demand forecasting models and will help producers align production runs with market signals, reducing overproduction and raw material waste. We are witnessing that mid-to-large processors have already standardised accounting for shelf life, batch recall, allergen management, and regulatory compliance. One area that is worth mentioning is how agri-tech firms are applying satellite imagery and weather analytics to predict crop yields. They are connecting farm-level data (soil health, crop yields, harvest timelines) with processing unit planning through digital platforms. This enables better raw material forecasting, reduces waste and idle capacity. Blockchain-based traceability systems, already being piloted for spices, basmati, and seafood, let processors certify origin and quality to global buyers, commanding premium pricing and strengthening India’s position as a reliable food export source.
- Government’s Incentive Programmes: The government should also get a lot of credit for its push through policy scaffolding. Initiatives like the Production Linked Incentive (PLI) scheme for food processing, the PM Kisan Sampada Yojana, and the Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PM FME) have ensured that thousands of crores are now available to enhance infrastructure, capacity building, and technology adoption. The PLI Scheme, in particular, has attracted substantial investments from both domestic and multinational food companies. It is aimed at creating global food champions, enhancing value addition, and improving the visibility of Indian food brands in international markets.
Honestly, we are far away from creating a seismic shift in the food processing industry through technology. This is a story in progress and bound to be successful. We now have the regulatory framework in place, capital access has improved, and tech implementation is being accelerated. What we need now is for these things to fire in unison.