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Day 24 – Q 2. The disruption of food supply logistics during the COVID pandemic has necessitated the expansion and upgradation of existing supply chains. Comment. What will be the overall economic impact of such expansion? Examine. (10 Marks)

  • IASbaba
  • February 23, 2022
  • 0
GS 3, Indian Economy, TLP-UPSC Mains Answer Writing
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2. The disruption of food supply logistics during the COVID pandemic has necessitated the expansion and upgradation of existing supply chains. Comment. What will be the overall economic impact of such expansion? Examine. (10 Marks)

कोविड महामारी के दौरान खाद्य आपूर्ति लॉजिस्टिक्स में व्यवधान ने मौजूदा आपूर्ति श्रृंखलाओं के विस्तार और उन्नयन को आवश्यक बना दिया है। टिप्पणी करें। इस तरह के विस्तार का समग्र आर्थिक प्रभाव क्या होगा? जांच।करें।

Approach 

Students are expected to write about the supply chain disruption due to COVID and how expansion and upgrading the sector will cater the disruption also highlight it’s impact on the overall economy. 

Introduction 

Supply chain management (SCM) is the management of the flow of materials and goods. It  will include the movement and storage of food grains and it’s inventory from point of origin to point of consumption.

Body 

Disruption during COVID19:

  • The COVID-19 pandemic has placed unprecedented stresses on food supply chains, with bottlenecks in farm labour, processing, transport and logistics, as well as momentous shifts in demand. 
  • Grocery store shelves have been replenished over time, as stockpiling behaviours emerged. 
  • Some farm sectors are more dependent on seasonal labour fruits and vegetables are more Labour-intensive. Limits on the mobility of people have reduced the availability of seasonal workers for planting and harvesting in the fruit and vegetable sector. 
  • COVID-19 has led to disruptions in food processing industries, which have been affected by rules on social distancing. 
  • As a result of pandemic, significant number of people are now working from home which has accelerated the demand for ready-to-eat products (saw 170% increase in sales volume between March-June 2020).
  • The pandemic has bolstered consumer awareness of functional foods, which is expected to provide a boost for health-orientated start-ups and micro-food processing units.
  • While the impacts of COVID-19 are still unfolding, experience so far shows the importance of an open, predictable, upgraded expansion of SCM environment to ensure food can move to where it is needed.

Expansion upgradation and it’s economic impact:

  • The focus of expansion and upgradation should be on food availability and consumers’ access to food; other important aspects, such as livelihoods of farmers and other supply chain actors, and environmental and health implications should also be covered. 
  • We need to find ways to increase resilience across our food systems by identifying new marketing channels like e-commerce which will result into more avenues to the farmers to sell their product in case of low demand in the local market.
  • If feasible, relocate markets to larger premises, while ensuring the appropriate infrastructure it will impact into maintain health, hygiene, quality and food safety.
  • It would be a good initiative to identify collection centres closer to producers, for example develop storage facilities like warehouse receipt system platforms where farmers can deliver their produce without the need to go to markets.
  • It will Incentivises firms for incremental sales and branding/marketing initiatives taken abroad.
  • Promoting innovation in both food products and processes will replace the staples of rice and wheat in the form of Nutri-cereals, plant-based proteins, fermented foods & health bars.

Response to Covid-19:

  • Rapid up-gradation under Atma Nirbhar Bharat Scheme and Subsidized food grains under Pradhan Mantri Garib Kalyan Yojana. 
  • Active association and participation of all stakeholders, governments, NGOs, and private sectors was carried on.
  •  India has formulated a unique Production-Linked Incentive Scheme (PLIS) to boost processed food in large quantities. 
  • FAO new comprehensive Covid-19 Response and Recovery Programme to provide an agile and coordinated SCM response aimed at ensuring access to nutritious food for everyone.

Conclusion

With growing populations, changing food habits and unrestricted use of natural resources, nations must come together and lay out a road map for a common efficient food value chain.

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