Government Initiatives
- Inclusion of food & Agro-based processing units and cold chain as an agricultural activity under Priority Sector Lending (PSL) norms in April 2015.
- Shifting from product-by-product approval to an ingredient and additive-based approval process by the Food Safety and Standards Authority of India (FSSAI) through notifications in 2016 as a measure toward ease of doing business.
- Allowing 100% Foreign Direct Investment (FDI) approval under automatic route for the food processing sector.
- Setting up a Special Food Processing Fund of Rs. 2000 crore with National Bank for Agriculture and Rural Development (NABARD).
- Other Government Initiatives:
- Pradhan Mantri Kisan Sampada Yojana
- Pradhan Mantri Formalisation of Micro Food Processing Enterprises Scheme
- Production Linked Incentive (PLI) Scheme for food processing industry
Way Forward
- To further enhance the growth and competitiveness of the food processing industry, several policy measures should be considered and implemented.
- The proposal for establishing a Food Processing Bank, currently under consideration, could effectively address the issue of credit accessibility for entrepreneurs in the sector.
- The implementation of the Model Contract Farming Act would facilitate crucial backward linkages necessary for scaling up and ensuring the economic viability of food processing ventures.
- Prioritising sector credit for all related activities within the food processing industry, along with extending fiscal incentives for technology upgradation of existing facilities, would further support its development.
- Quality control mechanisms aligned with global standards, facilitated through specialized institutes, are imperative to ensure the quality and safety of processed food products.
- Moreover, introducing courses in food packaging, processing, and biotechnology at Agricultural Universities would contribute to the development of skilled personnel in the sector.
- Ultimately, the food processing industry holds the potential to significantly reduce the wastage of perishable agricultural produce and boost our export income, thereby contributing to agricultural sustainability and economic growth.