Warehousing in India

Warehousing in India

India is an agrarian country but the importance of warehousing was not felt till 1950. Agriculture contributes 16  percent of the overall GDP and accounts for employment of approximately 52 percent of the Indian population. It is estimated that more than 40 percent of our agricultural productions wasted due to poor storage facilities.

On the recommendation of the All India Rural Credit Survey Committee, the Agricultural Produce(Development and warehousing) Corporation Act enacted in 1956, authorized  the  Government to setup National  Co-operative Development and Warehousing Board  to develop agricultural Co-operatives and warehousing.

Main Warehousing Agencies in the Public Sector

The three main agencies in the public sector engaged in providing large scale warehousing facilities are:

A. Food Corporation of India (FCI)

It provides storage facilities for food grains. Food Corporation of India also hires storage capacity from other sources such  as Central Warehousing Corporation, State Warehousing Corporation and private parties. The available storage capacity of Food Corporation of India is 74.6 million tonnes. (August 28, 2013 Government told in Lok Sabha). The FCI was set-up under the Food Corporation Act 1964, in order to fulfil following objectives of the food policy:

i.               Distribution of food grains throughout the country for public distribution system.

ii.               Effective price support operations for safeguarding the interests of farmers.

iii.               Maintaining satisfactory level of operational and buffer stocks of food grains to ensure National food security.

B. Central Warehousing Corporation (CWC)

It was established in 1957. The available storage capacity of Central Warehousing Corporation is 11.17 million tonnes and with the operation through 464 warehousing centers across the country. (as on 30th September, 2017).

Functions of Central Warehousing Corporation:

i.               To provide agency services for scientific storage of agricultural produce, seeds, manures fertilizers, agricultural implements and other notified commodities.

ii.               To issue a negotiable warehouse receipt for procuring credit to the owners of goods.

iii.               To preserve the produce deposited with care and protect against insects and various pests and deterioration due to moisture and dampness.

iv.               To act as an agent of the government  for the purchase and sale, storage and distribution of specified commodities and transport to and from warehouse.

v.               To reduce the cost of storage and facilitate the marketing of produce through proper grading.

C. State Warehousing Corporation (SWC)

Every state government is given power to establish its own Warehousing Corporation after getting approval from the CWC. 50% of the capital is contributed by the CWC and the balance 50% contributed by State Government.

D. Tamil Nadu Warehousing Corporation (TNWC)

It was established in 1959. The available storage capacity of TNWC is 6.83 Lakh MT with 7 Regional offices and 256 Godowns across the state. It is one of the biggest public warehouses operating in the state, offering logistic services to a diverse group of clients.