India’s next phase of agricultural warehousing must move beyond traditional grain belts and expand into emerging cereal-surplus states such as Telangana and parts of eastern India, Niti Aayog Member (Agriculture) Professor Ramesh Chand said on Thursday, urging investors to align storage creation with shifting production trends.
Speaking at a PHD Chamber conference on agricultural warehousing in Delhi, Chand said Telangana’s rice area has tripled in the past 12–15 years as irrigation expanded. “Wherever water goes, rice follows,” he said. As a result, incremental warehousing demand in Punjab and Haryana will be limited, whereas “brick-and-mortar capacity will be needed more in states where the Green Revolution is now spreading.”
Chand noted that storage demand is rising faster than agricultural output, because the growth rate of marketable surplus typically outpaces production growth.
India's Scientific Storage Deficit By 2030
According to PHDCCI’s new report Agriculture Warehouse Market in India 2025–2030, India is projected to face a scientific storage shortfall of 69 million tonnes by 2030, driven by rising foodgrain output. The report estimates the warehouse market will grow from Rs 37,336 crore in 2025–26 to Rs 43,953 crore by 2030–31.
Although schemes such as PEG, AIF and PPP-based silo projects have improved the investment climate, the chamber said “further reforms in contracts, land access and financing are needed to unlock private investment fully.”
Chand called on private-sector leaders to send concrete inputs on boosting private participation in foodgrain storage to a high-level committee headed by former Cabinet Secretary Rajiv Gauba, set up by Prime Minister Narendra Modi in August to accelerate non-financial regulatory reforms.
Industry representatives raised concerns over regulatory barriers, uneven competition with public agencies, and state-level levies. Chand said a formal mechanism already exists for receiving such suggestions. “Any recommendation requiring government action in the warehousing sector can be brought to the notice of the panel,” he said.
He added that while India’s agricultural output has grown 4.5 per cent annually over the past decade, warehouse requirements for marketable surplus are expanding even faster — signalling strong long-term investment potential.
Chand acknowledged that unpredictability around the Essential Commodities Act (ECA) continues to deter private players.
“If the law restricts how much stock can be stored, why would anyone build warehousing capacity?” he said. Though the ECA has been used sparingly since the repeal of the three farm laws, he said the lingering risk still shapes investment behaviour.
Creating New Storage Demand Beyond Grains
Chand stressed that India’s warehousing strategy must reflect the country’s changing food basket. Of the 1,000 million tonnes of food India produces annually, only 350 million tonnes are foodgrains; the rest comprises perishables and semi-perishables.
“We tend to equate foodgrain with food; they are not synonyms,” he said, urging PHDCCI to prepare a complementary study on cold-chain and non-grain storage.
Several states, including Andhra Pradesh, Uttar Pradesh, Bihar and Maharashtra, suffer the highest losses in fruits and vegetables despite being major producers. Cold storage utilisation is also skewed, with potatoes alone occupying nearly 70 per cent of available space, crowding out more perishable items.
He noted that India’s per capita cereal consumption has dropped from 11 kg to 9.5 kg, opening opportunities in pulses, horticulture, milk and livestock products. While agriculture can maintain an annual growth rate of about 4 per cent over the next decade, demand is likely to rise by only 2–2.5 per cent, making export-linked storage increasingly important.
Chand said India’s food losses are often overstated. “In milk, our loss is only 0.5 per cent, and that is the most perishable commodity anyway,” he noted. Cereals lose 3.9–5.9 per cent, pulses 5.6–6.7 per cent, fruits 6–15 per cent, and vegetables 4.8–11.6 per cent, indicating that the challenge varies sharply across commodities as per NABCONS findings.
However, he added that a “large component of current food losses is preventable,” underscoring the need for improved storage infrastructure and cold chains. |
