Presented at World Conference Cold chain - Thaifex 2013. Opportunity and Challenges in emerging markets, case study India. Cold chain development, the need and the success in hand. Market prospects for cold chain in emerging markets with focus on India.

1. Principal AdvisorChief Advisor to

2. Globalisation
 Process Integration.
 Bilateral trade.
 Diminishing world,
singular demands.
 Right-Cost Country
optimisation.
 Business friendly
Global Banking.
 Borderless consumer.

3. Growth in
initial areas
extends parity.
Parity feeds
demand; new
consumption.
Demand
outpaces
development.
Lack of development
creates bottlenecks.
Bottlenecks
raise costs.
High costs restricts;
feeds aspirations.
Aspirations
provide further
scope.
Enduring Scope is Unending Opportunity.

4. Enduring Scope is Unending Opportunity.
Chain of business
 Chain of transactions.
 Chain of information.
 Chain of operations.
 Chain of processes.
 Chain of policies.
 Chain of people.
 Value chain.
Demographics, National Priorities,
Sustainability, Technology,
Information, Affiliation.

5. Uneven, non-holistic development of
resources!
Cold-chain requires integration across
total activity chain!
Changing priorities, impatient populace –
short cuts!
Fear of missing the bus – short term
strategy for long term solutions!

6. Integrated infrastructure development.
Reverse haulage – capacity utilisation.
Market capture – barriers and tariffs.
Training and Skilled deployment.
Rapid demo-graphic changes.
Changing global strategies.
Technology adaption.
Investment inertia.

7. FSMA /
FSSAI /
Others
Trend is to move from post-facto control mode to
first mile preventive mode.
Impacts independent development agendas;
changed deployment of resources.
Benefits stakeholders from early compliance;
lowered rejects, opens strategic options.
More inclusion among stakeholders.

8. Prevent
Controls
Inspect
Compliance
Recall
Response
Partner
Administer
Resource
Labs
Skills
Costs
Fees
Procurement
Onus
Distrust
Sharing
Business
New markets
New pricing

9. The largest producer of milk (133 million tonnes).
Largest producer of mangoes (15 million tonnes).
Largest producer of bananas (29 million tonnes).
Largest exporter of beef (1.52 million tons),
largest buffalo livestock (105 million).
Second in fruit (80 mlllion tonnes) and vegetable
production (160 million tonnes).
Third-largest producer of fish (8.3 million tonnes).
Third largest pharmaceutical producer, 8% of
global production.

10. Human population of 1.22
billion.
with a GDP of USD 1.94Trillion.
Post harvest value loss ~18-40%
of farm produce.
ForeignTrade USD 795 billion.

11. Coastline is more than 7,500 km long.
Interspersed with more than 200 ports.
International cargo: 95% by volume and 75% by
value is carried by sea.
Ports capacity 1,247 million tonnes, doubling by
2017.
Railways: 87,087 km, across 7,083 stations and
operates more than 18,000 trains every day.
4.2 million km Roads : National Highways -
76,818 km, State Highways - 154,522 km, District
Roads - 2,577,396 km, Rural Roads - 1,433,577 km.

12. not a single perishables
gateway!
only ~8000 reefer trucks.
limited reefer rail options.
Containerisation at 20%.

13. 4th largest electricity consumer, fifth largest
installed capacity (246 GW) with 11.5% renewable
capacity.
300 clear days, Solar radiation 4 to 7 kWh/m2;
area 3.287 million sqkms.
Solar reception 5000 Petawatt-hours per year.
Fifth largest in wind power; 18,634MW in 2013.
Among lowest ecological footprints of 0.9
gha/person.
Starkly different, tightly clustered; six major
climatic zones.

14. DTR: (Tmax) – (Tmin) of 20°C
Shortfall of power, reliance
on diesel gensets.
Insulation and energy
efficiency standards.
Portability options min.

15. 24.0
25.0
26.0
27.0
28.0
29.0
30.0
31.0
32.0
800
850
900
950
1000
1050
1100
1150
1200
1250
%oftotal
millions
Urban population % Total population million
0.0
0.5
1.0
1.5
2.0
2.5
800
850
900
950
1000
1050
1100
1150
1200
1250
%Growth
millions
Total population million Population annual % change
 Indian Economy: growing at
more than 8% for last
decade, population growing @
1.5% annually for last two
decades.
 Continuous urbanisation of
India due to expanding
development.
 Projections: on-going Key socio-
economic changes and four fold
growth in the size of middle to
rich class Indian households;
resulting doubling household
consumptions by 2020.
 Young populace, aspirations
overreached and to stay
stretched.

16. GDP USD 1.94 trill in 2012 from 1.25 trill
in 2006 (+56% in 6 years).
Spending growth: $991 billion in 2010 to
$3.6 trillion by 2020 (5.8% of global
consumption, doubling from 2.7%).
1,870,000 Consumer Food outlets (2012).
Source: Boston Consulting & CII, IRIS, MoSPI- Govt of India.
474
593
785
1003
354
444
565
735
FY05 FY07 FY09 FY11
Domestic spend (USD from ₹)31-Jan-2012
Per Capita Disposable Income Per Capita Disposable Spending
>2 x from 2005
60%
17%
10%
6%
4%
3%
India Spends on
Food and Grocery
Others
Clothing and Fashion
Electronics
Beauty andWelness
Furniture and Fixtures
Increased
Demand for
(Cold Chain)
Quality
Foods
Increase in
consumer
class pop.
Purchasing
power, Rise in
income
Changed
consumer
mindset
Easy
consumer
credit
Quality &
Hygiene
consciousness

17. 28.6
43.0
50.9
65.6 68.5 71.5
74.9
81.0
58.5
88.6
101.2
128.4
129.1
134.1
146.6
155.0
0
20
40
60
80
100
120
140
160
180
Million
MetricTons
Horticulture Production
Fruits Vegetables Plantation Crops Others
x 2.6
x 2.8
Others: includes Spices, Loose Flowers, Nuts, Mushroom, Aromatic/medicinal and Honey .
Source: Horticulture Division, Ministry of Agriculture and CrossTree Analysis
Agriculture
cultivated area: 150
million hectares
• Area under
Horticulture: 23 million
hectares (15%)
$260 billion to
Indian GDP by
Agriculture
• 35% of this is from
Horticulture.
Within Horticulture, perishable commodities trends higher
& drives growing demand for perishable handling.

18. Inflationary trend (40 years) shows
Food as prime driver with
perishables contributing highest.
Despite producers showing robust
response by increasing supply, yet
inflationary pressure exists.
This may indicate that demand for
perishable products continues to
outstrip supply.
This also indicates a lack of
efficient supply systems which
continues to feed inflation in food
items. 1971-72 to 1981-82 1982-83 to 1993-94 1995-96 to 2004-05 2005-06 to 2011-12
All Commodity 10.2 7.9 5.9 6.6
Primary Food 8.5 9.2 5.9 9.9
F & V 9.0 10.6 7.5 9.2
Milk 7.1 9.0 5.7 10.1
Eggs, Meat, Fish 11.0 9.4 6.4 11.8
10.2
7.9
5.9
6.6
8.5
9.2
5.9
9.9
5.5
6.5
7.5
8.5
9.5
10.5
11.5
Inflation%
Trends - AnnualAverageWPI Inflation
(from 1970 to 2012)
Continual demand for food distribution and
cold chain is foreseen over coming decade.
Source: RBI, Office of Economic Adviser, MoCI, Govt of India

19. • Global Cold chain logistics spend from
$5.2 billion in 2008 to $6.9 billion in 2012.
• Growth in Asia outstripped all regions.
• Asia & India continue to grow into a major
hub for Bio-Pharma, cold chain demand
from the sector continues to rise.
Notes : Figures exclude clinical trials which is separate specialised logistics.
Sources: Cold-Chain BioPharma Logistics Sourcebook 2011 & UN Comptrade database, Orkash and CrossTree Analysis
2.1 2.5 2.7 3.2
1.5
1.7 1.9
2.31.0
1.2
1.5
2.2
0.6
0.6
0.8
1.1
0
2
4
6
8
10
2008 2009 2012e 2015e
BioPharma Logistics Spending (USD Billion)
NorthAmerica Europe Asia Rest ofWorld
0 0.5 1 1.5 2 2.5 3
North America
Europe
Asia
Rest of World
Cold Logistics Growth
USD Billion
2012e
2008
$0.6 to 0.8 billion (33% Growth)
$1.0 to 1.5 billion (50% Growth)
$1.5 to 1.9 billion (27% Growth)
$2.1to 2.7billion (29% Growth)
Higher-than-average growth in vaccines & specialty
pharmaceuticals and heightened regulatory
requirements continues to drive cold chain for pharma.
3.7 4.9 4.9 6.1 7.2 8.3
10.5
13.5
16.7
11.5
13.4
15.6
18.4
21.5
24.7
28.4
32.4
36.7
0
10
20
30
40
2007 2008 2009 2010 2011 2012F 2013F 2014F 2015F
Indian Pharmaceutical USD Billion
Exports
Total
Cold chain shipment growth by region

20. Note : Total Food Service Outlets is a sum of Standalone , Leisure and Retail outlets
Source : Euromonitor, IBEF, IRIS and CrossTree Analysis
 India is 5th largest retail market worldwide.
 1,968,000 Consumer Food outlets by 2015.
Organised Retail Market is growing despite FDI.This
feeds demand for cold chain. Simultaneous growth in the
food service sector accelerates need for the cold-chain.
0
20
40
60
80
100
120
140
160
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2005 2006 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E
Food Service Outlets (‘000)
Standalone (LHS) Leisure (RHS) Retail (RHS)
27.8 41.4
88.6
396.1
486.4
780.5
0.0
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
2010 2012 2015P
Size of Retail Market (USD Billion)
Modern Retail
Traditional
Food &
Grocery
Furniture
&…
Electronic
s
Beauty &
Wellness
Clothing &
Fashion
Others
99%
77%
96%
88%
89%
90%
Traditional Modern

21. Notes: 2009 and 2010 numbers only for NHB and NHM assisted cold storages. Numbers as of Dec 2012
Source: NHB, NHM, Directorate of Marketing and Inspection 2009, Orkash & Crosstree Analysis
0
5000
10000
15000
20000
25000
30000
35000
0
1000
2000
3000
4000
5000
6000
7000
1955 1960 1965 1970 1975 1979 1986 2004 2007 2009 2010 2011 2012#
(‘000)tons
Number
Cold Storage Availability
Number of Cold Storages
Installed Capacity in '000 tons (Cumulative)
In the Last Decade1955-1986
As of last recorded national level data , India has 6488 cold storage with a cumulative
installed capacity of approximately 30 million MetricTons .
Key Trends
• More than 25% of the cold storage units (~10 mill tons) have been built post 2004.
• Growth (CAGR 2004-12 ) : Numbers of Cold Storage : 3.57%, Capacity : 5.19%. Growth in Transport capacity 22%
• Current short fall of 4000 reefer trucks, govt states another 30+ million tons capacity needed.
The witnessed growth in the Cold Storage sector is accepted to only accelerate in the coming years
88%
12%
Segments
Storage
Transport
2007-08 2010-11 2014-15
2.1
3.8
6.9
0.2
0.9
1.9
CC Market U$ Billion
Storage Transport

22. Capacity mostly focused on single product types –
a long learning curve established
Minimal outreach for foods and pharma –
localised operations, earlier focus was storage.
Chain approach to counter Irregular parameters
across regions and within days.
Fragmented development did not encourage
holistic cool logistics for single source service.
Refrigerated systems need adaption to India
specific needs in design and capacity utilisation.

23. Capacity mostly focused on single product types –
a long learning curve established
Minimal outreach for foods and pharma –
localised operations, earlier focus was storage.
Chain approach to counter Irregular parameters
across regions and within days.
Fragmented development did not encourage
holistic cool logistics for single source service.
Refrigerated systems need adaption to India
specific needs in design and capacity utilisation.

24. Government as
‘Catalyst’
Encourages
Investments
Agri/Foods identified as
priority sector
Encourages
holistic
development
NCCD takes shape
Liberalises
Marketing
Norms
Focus on Market links
development
Rationalises
Tax Laws
Move to uniform
VAT/GST
Credits
Grants &
Subsidies
PPP, Grants, Negotiable
Warehouse Receipts
Liberalising
FDI Inflow
100% FDI in food
sector
Increasing focus to create enabling infrastructure by govt. While this support was earlier
focused on static cold storages, recent developments have been to include refrigerated trucks
including containers. NCCD to play pivotal role to correlate industry expectations and policies.

25. Subsidies
available for
constructing
Cold Chains by
Govt. of India
Capital
Investment
Subsidy / RIDF
Scheme
Integrated Cold
Chain Scheme
PPP-IAD
NVIUC
Public
Entrepreneur
Guarantee
Scheme 40.9
593.9
1187.5
0
500
1000
1500
Xth Plan XIth Plan XIIth Plan
USDBillion
Outlay Amounts for Infrastructure
Development
(FiveYear Plans)
Initiatives for Infrastructure Development
• Mega Food Parks Scheme.
• Integrated Cold Chain Scheme.
• State level Initiatives.
• National Horticulture Board.
• National Horti and FPI Missions.
NCCD as umbrella agency
to address concerns.

26. Central Excise Duty
• 100% exemption for specified equipments for storages or transport, self loading /
unloading trailers / semi-trailers.
Customs Duty
• Full exemption from basic customs duty for manufacture of refrigerated vans/trucks; bio-
polymer/bio-plastics;
• Concessional duty of 5% for initial installing or expansion of a cold storage, cold
room, processing, etc.
ServiceTax Exemption
• ‘Erection, Commissioning or Installation’ of Mechanized Handling Systems; Cold Storage
and transport;
• Cold-chain Service of storage and transporting agriculture produce.
• TechnicalTesting; Analysis Service and ‘Technical Inspection and Certification Service’.
Capital Investment
• Cold Chain & FDI: 100% FDI through automatic route.
• Investment linkedTax deduction : 150% of capital investment deductible.
• Government subsidy on investment: 40 to 55% subsidy on storage and transport

27. Industry, PSUs, Government, Investors, Entrepreneurs, Farming
Associations & Knowledge Houses - All Working Together!
Executive
Committee
2
5
3
4
1
TechnicalSpecification,
Standards,Test
Laboratory & Product
CertificationCommittee.
Training, HRD and
R&DCommittee.
Committee for Application of
non-Conventional Energy
Sources in ColdChain
Infrastructure.
NCCD Members, other
Committee for Supply
Chain & Logistics.
6
Liaison with other NLAs
and States
cold chain sectors

28. Cold Supply Chain (India): Poised for a Quantum Jump
Best practises for Sub-continent conditions, market.
Skill development & training establishments.
Appropriate & integrated Infrastructure development.
Adoption of energy efficient technology.
Partner with Indian logistics companies.
Adapting from mass storage to direct access storage.
Manage and develop Multiple markets in region.
Anticipate ahead of a developing market.

29. Innovators and solutions biased companies.
Technology Provision and implementation.
Cold Logistics and Supply Chain services.
Specialised Infrastructure designers and planners.
Expertise in alternate energy, environmental protection.
Scalable, Energy efficient Refrigeration technology.
RefrigeratedVehicles and last mile delivery systems.
Education,Training & Cold chain management experts.
Knowledge Managers and Integration specialists.

30. Food / Pharma Exports
Polio EradicatedQSR Majors
Eggs, Beef, Ice Cream

33. The Source and the Destination

34. Visualisation

35. www.nasa.gov Earth Gallery

36. Nodal Body for Cold-chain Development
Ministry of Agriculture
Contact-NCCD@gov.in