First of all, if the traditional supply chains in food items are so faulty and deficient, why did they not create such massive food price spikes earlier?
Why was food inflation relatively low in the period until 2006, despite equally rapid GDP growth and the same system of distribution that is being faulted?
Secondly, if the problem is inadequate infrastructure, including lack of cold storage facilities and quicker distribution networks from farm to market, what has stopped the government from more proactive intervention to ensure better cold storage and other facilities through various incentives and promotion of more farmers’ co-operatives?
This is what China has done proactively for some time now, and indeed such proposals are explicitly mentioned in the Farmers' Commission Report, which has been lying with the government for half a decade now.
The idea that cold storage and other facilities can only be developed by large private corporates once they get directly involved in retail food distribution is ridiculous at best.
Thirdly, this entire argument completely ignores the critical role that can be played by a public distribution system in moderating such food price spikes and dampening inflationary expectations and tendencies of hoarding.
Instead of accepting the failure of the government to use this system effectively so far, the tendency is to throw up hands and declare that only the large private sector can save us, even though international evidence indicates that corporate monopoly in food trade typically increases distribution margins rather than reducing them.
Image: A vegetable market in Ahmedabad is seen here.