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FMCG companies seek 'essential' permits to refill shelves amid coronavirus lockdown


NEW DELHI: Warehouses are stuffed with household staples such as meat, rice, fruits, vegetables and packaged food. But as the 21-day national lockdown severed logistical operations, the question is: How does all that food actually get to people?

Seeking immediate exemption from movement restrictions, companies including Britannia, Parle, PepsiCo, Hindustan Unilever, Dabur, Coca-Cola, ITC, Nestle and Mondelez have written to the government on Tuesday through three separate industry bodies. Further, these firms have also escalated their concern to the Prime Minister’s office. Officials say these companies are struggling to redirect the sprawling food supply chain to meet the surge in demand caused by the coronavirus pandemic due to movements restrictions imposed at this point in time.

“Local authorities are enforcing shutdowns of factories and creating ambiguity at the ground level, leading to unnecessary enforcement,” the companies said in one of the joint letters to the government.

Parle said it has been operating at 50 per cent capacity since Tuesday. “We want the sector to be treated as an essential service, to avoid shortages on retail shelves and prevent consumer panic,” said Mayank Shah, senior category head of Parle Products. If the supply chain isn’t restored immediately, the company will have no stock left in the factory in 2-3 days due to production curtailment. The biscuit major also needs to kick start production as it wants to donate three crore packs of biscuits in the next three weeks to the needy people through government agencies.

According to a HUL spokesperson: “In the last couple of days, there has been a significant amount of difficulty in running the factories and transportation of goods even though the government has rightly permitted food, vegetables, groceries and medicines to be excluded from the lockdown. However, enforcement authorities across states need to be given clear instructions so that these essential items and the supply chain around it is allowed to function.”

HUL said it had decided to ramp up manufacturing to produce more handwash, sanitizers, floor cleaners and hygiene products but is unable to fulfil the surge in demand due to production curtailment.

Varun Berry, managing director, Britannia Industries also echoed similar sentiments. “The food industry supply chain is disaggregated and dependent on inter-state movement of goods. Due to the nature of the materials, inventories across the chain are low. If even one link in the supply chain is broken, the country could run out of stocks of packaged food in the next 7-10 days.” The supply chain for food products, he said, should be restored in entirety and allowed to function with adequate safety measures and police protection.

The supply chain includes suppliers of raw materials and packaging materials, food manufacturing factories, factory workers, transporters carrying materials and finished goods, wholesalers, distributors and their salesmen. “As the central government has clearly given the necessary approvals, the immediate need of the hour is that it be percolated right down to the district authorities and permits need to be immediately issued to all in the supply chain,” Berry added.

Officials of US India Strategic Partnership Forum have also warned that these restrictions would have a direct impact on farmers and their produce. “Supply chains for food are highly integrated; disruption to any one part will have a ripple effect and the impact would be felt back to the agriculture sector,” it said in a letter addressed to consumer affairs secretary Pawan Aggarwal and also called for all truckers and transporters carrying raw material including that meant for packaging to be permitted interstate movement and also within cities.

An ITC spokesperson also reiterated that the company is in constant dialogue with relevant state government authorities to seek permission and clearance for the manufacture of essential products in select factories with bare minimum people, and transportation of essential products from the factories, warehouses to retail outlets. “Truck movement — both inter-state and local — has been currently impacted. It will take a few days for the entire ecosystem and processes to fall in place for movement of essential goods,” the spokesperson added.