The Go-Bag (or backpack [item]) is a portable kit filled with supplies that every agent of The Division is carrying with them. Besides weapons and ammo, it also includes clean water and food to be able to survive for at least 72 hours.
In addition to its survivability aspect, the backpack works like an inventory and defines how many items you can carry at the same time and might also grant an additional skill bonus as it’s counted to the skill themed items.
Furthermore it’s one of the items that will affect your character’s appearance the most, at least for you in third person view. The higher the level and quality of the backpack item, the better it will probably look like, as you can for example see in the video below.
Power-Ups and Buffs
Tom Clancy’s The Division is not a survival-based shooter and therefore your character’s life doesn’t depend on the factors eating and drinking, which means that it’s not required to consume certain items to stay alive.
Nevertheless, it is worthwhile to take such items (consumables) like water bottles or canned food with you, because they can be consumed at a later point and will grant you different temporary power-ups or buffs in an as yet unknown manner.
More information about the equipment.