Lok Sabha Question No. 3156 (UNSTARRED), answered on 2017-03-21
Subject: Investment in Food Processing Sector
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: Shrirang Appa Barne, SHIVAJI ADHALRAO PATIL, VINAYAK BHAURAO RAUT, PRITAM GOPINATH MUNDE

## GOVERNMENT OF INDIA MINISTRY OF FOOD PROCESSING INDUSTRIES

## LOK SABHA

## UNSTARRED QUESTION NO. 3156

ANSWERED ON 21 ST  MARCH, 2017

## INVESTMENT IN FOOD PROCESSING SECTOR

## 3156.   SHRI SHRIRANG APPA BARNE: SHRI ADHALRAO PATIL SHIVAJIRAO: SHRI VINAYAK BHAURAO RAUT: DR. PRITAM GOPINATH MUNDE:

Will the Minister of FOOD PROCESSING INDUSTRIES be pleased to state:

- (a) whether the country's food processing sector has potential to attract huge investment and generate more employment by the year 2024 and if so, the details thereof;
- (b) whether the food processing is a key contributor to employment generation in India and if so, the details thereof;
- (c) whether  India  is  one  of  the  top  rankers  in  the  production  of  bananas,  guavas,  ginger, papaya and if so, the details thereof;
- (d) whether  despite  the  massive  production,  the  degree  of  processing  is  low  and  ranges between 2%-35% for different produce and if so, the details thereof; and
- (e) the steps taken by the Government to increase investment in food processing infrastructure?

## ANSWER

## THE MINISTER OF STATE FOR FOOD PROCESSING INDUSTRIES (SADHVI NIRANJAN JYOTI)

- (a) There is a scope for growth of food processing industries as the level of food processing in the country was only 6.76% in 2010-11, as per a 2014 study, commissioned by Ministry of Agriculture & Farmers Welfare, and undertaken by Institute of Economic Growth. Government is  promoting both domestic and foreign investment in food processing sector and employment levels therein.
- (b) As per the Annual Survey of Industries 2014-15 conducted by Central Statistical Office, Ministry  of  Statistics  and  Programme  Implementation,  Food  Processing  is  one  of  the  major employment intensive  industries  constituting  12.77%  per  cent  of  employment  generated  in  all factories registered under Factories Act 1948. The total number of persons engaged in such food processing industries was 17.73 lakhs in 2014-15. As per the NSSO 67 th Round, 2010-11, total number of persons engaged in unincorporated enterprises of food processing industries was 47.9 lakh.

(c) Yes  Madam.  As  per  Food  and  Agriculture  Organization  of  the  United  Nations,  India ranks number 1 in the world, in 2014, in the production of Banana, Guava (including mangoes and mangosteens), Ginger and Papaya with the following share:

| Item                                      | Share (%)   |
|-------------------------------------------|-------------|
| Banana                                    | 26.04%      |
| Guava (including mangoes and mangosteens) | 40.75%      |
| Ginger                                    | 30.37%      |
| Papaya                                    | 44.51%      |

(d) India  has  huge  diversified  production  base  but  low  level  of  processing.  The  level  of processing in perishable products in India is estimated only at 2.1% in fruits and vegetables, 6% in poultry, 21% in meat, 23% in marine and 35% in milk and milk products.

(e) To increase investment in food processing infrastructure the Ministry of food processing industries  is  implementing  a  number  of  central  sector  schemes  namely  (1)  Scheme  for  Mega Food Parks (2) Scheme for Modern Abattoirs (3) Scheme for Integrated Cold Chain and Value Addition Infrastructure (4) Scheme for Creation/Expansion of Food Processing and Preservation (5) Scheme for Quality Assurance (6) Scheme for Human Resource and Institutions. Further, the Government has provided various fiscal incentives in terms of reduction and exemption of taxes. A  fund  of  Rs.  2000  crore  has  also  been  constituted  with  NABARD  to  provide  loans  at concessional rate to Mega Food Parks and units established therein. Loans to food & agro-based processing  units  and  Cold  Chain  have  been  classified  under  Agriculture  activities  for  Priority Sector  lending  (PSL)  as  per  the  revised  RBI  Guidelines  issued  on  23/04/2015.  100%  FDI  is permitted under the automatic route in food processing industries and through approval route for trading,  including  through  e-commerce  in  respect  of  food  products  manufactured  and/or produced in India.

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