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AUG2017 FOOD FOCUS THAILAND
SPECIAL
FOCUS
policy to reform theagriculturalsectorand “Make in India”
policy, which focuses on deepening restructure the
manufacturing sector aswell as the establishment of a
MegaFoodParks to strengthen food production, those
factors have stimulated the world’s leading food
producers enter to themarket. Those factors havealso
increased the demand for modern cold chain, major
infrastructure linking agriculture to food production and
consumption sectors in the future.
Moderncoldchain isdifferent frombusinessesstyle
in India. It needs to focusonmanydetails. For instance,
they needs to concern on the use of buildingmaterials
forwarehouseswithget the ISO-certified, or using food
grade materials that meet GMP and HACCP safety
standards, while can prevent fungal and bacterial,
concernonenvironmental byusingCFC-freematerials,
use technology to reduceenergycostsbyusing thermal
materials,useofanti-leakagedevices,switch touseLED
bulbs and solar cell, as well as connecting businesses
to the digital world, by installing RFID chips for fast
checking for inventory.
Therefore, according to the Kasikorn Research
Center, it has foreseen that with strong demand of the
market, it isanopportunity forpotentialThai businesses
to invest there. Two forms of investment in theModern
ColdChain business in India can bedoneas follows:
1.Merger and Acquisition (M&A)
with existing
businesses in India as one of themost convenient way
and benefit both parties. With this method, the
entrepreneur can quickly get involved in the business.
This type of investment is suitable for businesses that
see opportunities for the development of cold storage
whichhaveover7,129units in India,andhavecombined
capacityup to32.8million tonnes,which75.4%of these
figure is used for freezing potato. The country has still
lack of technology andmanagement techniques in this
business.
Investing in thecoldstoragebusiness, investorscan
choose the investment areas that correspond to the
targetedmarket.After that theycandevelop thebusiness
to meet the demand for other agricultural products,
besides potato. Investors should allocate cold storage
for multi-purpose or make the business as cold public
warehouse for renting and serving small enterprises to
freeze theiragriculturalproductsas Indianentrepreneurs
are lackingexpertise tocontrol temperatureandhumidity
for other agricultural products.
Therefore, the strategies to manage the costs
efficiency andmodern the cooling technology will help
expand businesses in the domestic market. Joint
venturesor acquisitionsshouldbeconsidered tocreate
awarehousenetwork ineacharea thatwillallowefficient
distribution of goods. They should also select the area
to match the purpose of the business. For instance to
penetrate to the urban consumers, whilemany foreign
retailers such as from the United States, Europe, and
United Arab Emirates are currently expanding their
branches to new emerging cities or secondary cities to
Punjab, Haryana, Madhya Pradesh andGujarat, while
businesses focus on export markets and newmarkets
in thesouthern,westernandeasternpartsof thecountry,
which are important economic area in Maharashtra,
Tamil, Nadu, or if businesses catching in agricultural
market, theywill go toMadhyaPradesh.
2. EstablishingaNewBusiness toFulfill theExistingDemand.
Thisstrategy isquite
challenge and risk for inexperienced area. However, it is advantages that these businesses
are still not competitive. In particular, the investment in the Mega Food Parks, which are
accelerating development to becomemodern food production infrastructure, and are ready
for capital subsidies with special interest rates and the grace period of payment. Currently,
Indiangovernment hasalreadyapproved theestablishment ofMegaFoodParks in17areas
such as inHaryana, Punjab, Gujarat, Bihar, Telahan, Orissa, Tamil Nadu, Maharashtra, and
Kerala States, while other 25 areas are waiting for approval. Type of businesses that India
are still lacking areas follows:
•ReeferVehicles
Thisbusiness isstill ingreat need throughout thecountry. Enterprises
havegreater opportunity in thisbusinessas fewplayers, whileexistingplayersprovide short
distance service. Transportation service is not widespread, while the temperature control
