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Fortifying India: challenges and opportunities for large-scale food fortification in India

Food fortification can significantly impact nutrition and health, and for 70% of India’s population with low incomes and nutrient deficiency, it has transformative potential, especially in light of the Covid-19 pandemic. Dalberg developed this article following a 2019 engagement with a large global foundation that aimed to unlock barriers and accelerate progress related to combating micronutrient deficiency.

India is home to one in three of the world’s malnourished children and has the second highest level of wasting among children globally. Women in India have the highest prevalence of anemia globally. Widespread malnourishment is largely due to poor food quality that is highly deficient in the micronutrients needed for growth and development, such as iron, zinc, vitamins, and folate. Over 70% of the Indian population consumes less than half the daily recommended dietary allowance of micronutrients with deficiencies affecting all population groups in India – urban, rural, rich, poor, old, and young – but with women and children most at risk. For instance, although 80% of the overall population has a Vitamin D deficiency, it stands at 93% for children[1] and 91% for women.

Furthermore, as Covid-19 disrupts livelihoods as well as food and health supply chains, the nutritional status of millions of people is likely to worsen as both the availability of food and the ability to pay for it become more sporadic.

An effective solution to malnutrition: Large scale food fortification

Large-scale food fortification (LSFF) is a powerful, proven and cost effective way to tackle micronutrient deficiency. It is a process through which micronutrients are added to food chemically, biologically, or physically. It began in the 1920s with salt iodization in Switzerland and has increased substantially over the years. In 2019, 137 countries mandated fortification of at least one food while 68 mandated for two foods[2]. Most food fortification efforts involve the addition of a few key micronutrients to base foods: Vitamins A and B, iron, iodine, and zinc. 

According to a World Bank study, “probably no other technology available today offers as large an opportunity to improve lives and accelerate development at such low cost and in such a short time” as fortification to address micronutrient deficiency.

Through a collaboration with the nutrition team at a large global foundation in 2019, Dalberg researched and analyzed the evolution of LSFF in India, examined value chains, and identified barriers to scaling, to propose solutions to make fortified food more widely produced, distributed and consumed.

A slow start for LSFF in India – and 5-years where momentum has built

In India, the journey with food fortification began in the 1950s with vegetable oil fortification and salt iodization. Other commodities such as rice and wheat flour were finally introduced in the 2000s, after a 60 year gap between global evidence and the first pilots, and the earlier government initiatives in India[3].

Momentum kicked-in in 2016 when the country’s food regulator—Food Safety and Standards Authority of India (FSSAI)—established standards for fortification of rice, wheat flour, edible oil, double fortified salt (DFS), and milk[4]. It also established the Food Fortification Resource Centre, developed the ‘+F’ logo, and built capacity for producers. Mandates were also issued to use fortified staples in safety-net programs, such as double fortified salt (DFS) and fortified edible oil through mid-day meal (MDM) and Integrated Child Development Schemes (ICDS)[5].

Food fortification in India remains unpenetrated

Even though fortification is a relatively simple and low-cost process for most staples, Dalberg estimates that less than 20% of Business-to-Consumer (B2C) production[6] of edible oil, salt, and milk, about 3% of wheat flour, and 0.1-0.2% of rice is being fortified, or double fortified in the case of salt. Estimates also indicate that 40-60% of fortified food production is either not reaching or is not being consumed by the most vulnerable population groups, namely low-income women and children. 

One reason for the low production of fortified rice and wheat flour may be that pilots and mandates occurred much earlier for oil and salt, but more recently for rice and wheat flour. Among the reasons for low uptake by vulnerable populations are offtake of fortified foods by only a few states (despite mandates), leakages in public supply chains, and limited penetration of private distribution channels in rural areas.[7] Covid-19 has exacerbated these problems due to disruptions in food supply chains and last-mile delivery, for example through school shut-downs.

The deeper issues impacting uptake of food fortification

But there are also several systemic factors at play that lead to limited production, significant leakages across the value chain, and low consumption by the most vulnerable. These factors cut across policy and governance reasons, industry structure, financial constraints, and social and cultural practices. 

To begin with, political momentum on nutrition at the Central Government level is not uniformly translating into consistent State-level actions, given the limited powers to ensure compliance, and weak coordination between departments. In addition, there is a lack of policy incentives for the private sector to fortify foods. Tracking of fortified food through the Public Distribution System (PDS) also needs improvement. 

Industry structure is another challenge. While the oil and salt industries are relatively consolidated with large players accounting for 40-90% of production, the rice, wheat flour, and milk industries are characterized by a vast number of small-scale informal producers. This makes dissemination, coordination, and capacity building very challenging since food fortification requires investment in machinery and processes on the one hand, and tracking and reporting on the other. 

The financing of such machinery is also a challenge. For instance, the capital costs of blending machinery, often make it unaffordable for small millers. A dosing system for rice, for example, costs INR 5-15 lakhs (US $6.8K-$20.4K) and a blender for wheat flour costs up to INR 1.3 lakhs (US $17.6K). Those interested in purchasing are often unable to access affordable finance, and the business case is not very clear for these SMEs.

For end-consumers, on the other hand, the affordability of fortified foods is not a significant barrier. Fortification only adds 3-7% to the retail price, so while cost is not a primary barrier, awareness levels tend to be low. There are also some challenges with cultural habits and “food aesthetics” that reduce consumption. As an example, double fortified salt can lead to discoloration of the food and does not see high levels of consumer demand.

Urgent action is needed from key players – Dalberg’s ideas for impact

Nutrition in India has received a lot of attention in recent years, and there is an opportunity for government, development actors, and the private sector to act decisively and concertedly to address these challenges and scale fortified food in India. 

Based on our analysis of the food fortification landscape in India and lessons from across the world, Dalberg offers four ideas:

  1. Building capacity within the public sector, improving Centre-State coordination, and nudging a “race to the top”: Given the multi-dimensional nature of successful food fortification business models, a toolkit or a “playbook” would be useful for Indian states, enabling them to implement best-in-class procurement and distribution models, and to manage economics and quality control. In parallel, a data platform to track state-level progress should be created and complemented with the establishment of a National Nutrition Index, by bodies such as the NITI Aayog that induce healthy competition amongst states, as seen in the case of the WASH, Health and Education sectors.
  2. Catalyzing technological innovation focused on FF automation and quality assurance: Innovations can make machinery more affordable for small producers, reduce leakage, and improve accountability, among other use-cases. In this context, a “Sandbox” to spur hardware innovations that make fortified production “default” (e.g., by using electric dosifiers with built-in sensors for pulses and legume millers), and innovations that improve traceability across the supply chain (e.g., using blockchain) can be game-changing. Also, innovations in food packaging can mitigate the adulteration of fortified food. 
  3. Well-coordinated social marketing for fortified food: LSFF is not only a supply-side issue – demand needs to be spurred, and there’s opportunity to do so by end-consumers as well as “intermediaries”. Ecosystem actors can adopt “nudges” and popularize the ‘+F’ logo to create consumer pull for fortified food. In rural areas, community platforms such as Self-Help Groups can generate awareness and cook meals using fortified staples. For urban segments, the government can mandate the use of fortified staples through food processors and food & beverage chains, encourage workplaces to serve fortified foods in their canteens, and influence large retailers to promote them.
  4. Adopting innovative finance solutions to crowd-in resources for LSFF: There is a need for capital to scale food fortification, especially as governments become more cash-constrained due to Covid-19. As has been done successfully in sectors such as education, pay-for-performance instruments such as impact bonds, or de-risking instruments like first loss guarantees, can be designed to increase access to capital for the private and non-profit sectors working on food fortification. Government and development finance institutions can partner to implement such financing pegged to tangible improvements in micronutrient deficiency, particularly in high-prevalence states.

With Covid-19, the time for action is now 

Micronutrient deficiency is a pervasive and persistent problem in India, and food fortification is a powerful means of addressing it. Given that Covid-19 will likely worsen nutrition outcomes across India, reducing incomes and access to food, stepping up focus on LSFF is even more important to ensure health and resilience among at-risk populations. 

Before March 2020, when Covid-19 became a significant challenge for India, there had been structured efforts to improve nutrition overall: increasing political buy-in, FSSAI’s leadership, uptake by prominent private sector producers, mandates for distribution through social safety net programs, and increasing coordination among development actors. For the sake of India’s most vulnerable, it is important that this momentum be accelerated through multi-stakeholder action at scale.


 

[1]NFHS-4 survey, FFRC website

[2]Global Fortification Data Exchange (https://fortificationdata.org/)

[3]Mandatory rice fortification legislation first introduced in 1952 in the Philippines, and for wheat flour in 1942 in the United States

[4]https://ffrc.fssai.gov.in/standards

[5]FFRC Brochure, May 19 (https://ffrc.fssai.gov.in/brochure#)

[6]Production meant for retail consumption, not industrial purposes (e.g., food processing)

[7]Methodology: i) Availability assumed as quantum of commodity available for domestic consumption (domestic production + imports – exports); ii) Fortified production is quantum of fortified version; iii) Distribution calculated as offtake of fortified commodities by public channels (PDS, MDM, & ICDS) basis no. of states/ districts carrying fortified commodity, & by open market (losses in distribution, due to pilferage, spoilage, & diversion from public to private channels assumed); iv) Consumption estimated basis amount available for consumption by TG (rural, low income) assuming full supply from govt. channels goes to TG & open market supply split across TG & Non-TG based on availability, affordability, etc. Source: RBI, PDS Procurement, Off Take & Stocks (Sep 17) Large Scale Food Fortification (Oct 17), Expert interviews, Dalberg Analysis

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