Cold chain industry to touch Rs 64,000 cr by 2017: Assocham

Organised retail sector to reach Rs 10 lakh cr by 2020, will be instrumental in dev of industry in India

The Indian cold chain industry, which stood at Rs 10,200 crore in 2009, is expected to register a compound annual growth rate of 25.8% to reach Rs 64,000 crore by 2017, according to an Associated Chambers of Commerce and Industry of India (Assocham)’s report.

The report ‘Opportunities in cold chain: Emerging trends and market challenges’, released at Assocham’s international summit here on Wednesday, said many private companies were likely to join the cold chain industry.

 

“The organised retail sector, which is expected to reach Rs 10 lakh crore by 2020, will play an instrumental role in the development of the industry in India. Increased focus towards the domestic industry will ensure the availability of food throughout the year and reduce wastage of food in the country,” it said.

According to the report, India produced about 147 million tonne vegetables in 2011 accounting for nearly 11% of the world's total production. However, India currently has a cold chain capacity of only 9 million tonne vegetables, leading to huge wastage annually.

“This has also impacted India’s share in the global export of vegetables that at present is around 1.7% only,” it added.

In accordance with the FDI regulation of multi-retail, companies proposing to take this route are required to invest 50% of their money in building new warehouses, cold storage units and modern transport systems. This measure will bring both the latest technology and the required monetary means in the cold chain sector as there are various large global players like Wal-Mart and Ikea that will join the Indian market soon, the report said.

Stating that revenues of the temperature-controlled warehouse market in the country had gained momentum towards the upside since the past few years, the report said the value of this market was expected to grow at a CAGR of 27% – a giant leap from Rs 9,800 crore in 2009 to Rs 62,400 crore by 2017.

“The shift towards horticulture products in India is expected to generate a significant demand for temperature-controlled warehouses as these are perishable in nature,” it stated.