The impact of globalisation has accelerated the nature of dietary change and this has implications for food supply systems. While liberalisation means large food chains have a strong incentive to enter in large Indian market but given their relative bargaining power it could have adverse effects on Indian suppliers. However, while diversification is important for the future of Indian suppliers, the direction of diversification needs to be such as to provide a hedge against risk as well as the process of transition in food production in order to meet the change in food demands. Indian agriculture is responding to the changing domestic demand and the effects of globalisation. This is happening through both public and private investment. The Indian government, recognising the increasing demand for fruits and vegetables, has dramatically increased investment in horticultural production in the last 15 years and this is expected to stand at Rs 20 billion by the next five-year plan. The poultry sector is one example of an industry that has reinvented itself to become a major commercial activity. In the last 15 years growth rates in production and consumption have been 11 per cent, well above the world growth rate of 5 per cent. Heavy investment in breeding, rearing and processing seems to have reaped dividends. The dairy industry has also been successful in meeting the rise in demand for milk products through the widespread establishment of milk co-operatives.
(The writer is the Vice Chancellor, Anand Agricultural University, Anand and can be contacted at [email protected].)