Is Wastage Fuelling Food Inflation?

Yes, according to a report titled What A Waste by ratings agency Crisil. The report says Rs 70,000 crore is lost every year due to lack of storage and logistics.

"Food gets wasted here before it reaches the consumer while it is the other way around in developed countries," D K Joshi, Chief Economist, Crisil, said in a discussion on BoomNews's show #IndiaHangout.

Here are some other key points raised by Joshi:

Demand has clearly outstripped supply in proteins

Why is that there is so much rice/wheat in the system and such high inflation?

There has to be intervention in the market

There has to be a process when there is a demand-supply mismatch

There is no price risk for farmers while growing rice/wheat due to minimum support price

Farmers have to be incentivised to shift to fruits/other crops

We need another white revolution

Duty reduction and increasing domestic production can reduce supply-demand mismatch

Last year, monsoon was good but inflation was very high

Inflation in processed food is much lower than raw food