Lok Sabha Question No. 3674 (UNSTARRED), answered on 2019-07-16
Subject: Processing of Fruits
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: Shrikant Eknath Shinde, Pritam Gopinath Munde, Girish Bhalchandra Bapat, Vinayak Bhaurao Raut

## GOVERNMENTOF INDIA MINISTRY OF FOOD PROCESSING INDUSTRIES

## LOK SABHA

## UNSTARRED QUESTION NO. 3674 ANSWERED ON 16 TH  JULY, 2019

## PROCESSING OF FRUITS

## 3674.   DR. SHRIKANT EKNATH SHINDE: DR. PRITAM GOPINATHRAO MUNDE: SHRI GIRISH BHALCHANDRA BAPAT: SHRI VINAYAK RAUT:

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

- (a) whether the country ranks second in the world in the production of fruits and vegetables and only 6 to 7 per cent of this is processed as compared to 65% in US and 23% in China, if so, the facts thereof;
- (b) whether  a  well  developed  food  processing  industry  is  needed  to  increase  farm  gate prices,  reduce  wastage,  ensure  value  addition,  promote  crop  diversification,  generate employment  opportunities  and  boost  exports  and  if  so,  the  steps  taken  by  the Government in this regard and the success achieved so far;
- (c) whether  the  Government  proposes  to  exempt  perishables  from  the  purview  of Agricultural  Produce  Market  Committee  (APMC)  and  to  make  direct  sales  to aggregators and processors, introduce electronic auction platforms for all the mandis, if so, the details thereof; and
- (d) the other steps taken by the Government to increase processing of food and to reduce the wastage of fruits and vegetables?

## ANSWER

## THE MINISTER OF STATE FOR FOOD PROCESSING INDUSTRIES (SHRI RAMESWER TELI)

(a): As per Food and Agriculture Organization of the United Nations, India occupies second position in the world in the production of Fruits and Vegetables. As per a study, commissioned by  Ministry  of  Agriculture  &  Farmers  Welfare  and  undertaken  by  Institute  of  Economic Growth, the average extent of food processing in the country was 6.76% in 2010-11 including fruits and vegetables.

(b): Yes, Sir. The Ministry of Food Processing Industries (MoFPI) is implementing a Central Sector Umbrella Scheme - PRADHAN MANTRI KISAN SAMPADA YOJANA -(PMKSY) for promotion and development of Food Processing Industries in the Country. The Ministry is also implementing the scheme "Operation Greens" as a vertical of PMKSY since November, 2018 to invest Rs.500 crore for integrated development of value chain of tomato, onion  and  potato  (TOP)  crops.  Number  of  Projects  sanctioned  under  various  component schemes of PMKSY is as under:

| Scheme Name                                                      |   No. of Projects |
|------------------------------------------------------------------|-------------------|
| Mega Food Parks                                                  |                42 |
| Integrated Cold Chain and Value Addition Infrastructure          |               292 |
| Creation / Expansion of Food Processing &Preservation Capacities |               180 |
| Infrastructure for Agro-processing Clusters                      |                39 |
| Creation of Backward and Forward Linkages                        |                64 |
| Food Testing Laboratory                                          |               140 |
| Operation Green                                                  |                 2 |

(c): Agricultural marketing is in the domain of State Governments and is regulated under the provisions of respective States' Agricultural Produce Market Committee (APMC) Acts. In order to ensure better price realization to the farmers, Government is advocating with the States to deregulate the marketing of Perishables (Fruits and Vegetables) outside the market yards. Further, for better price realization to the farmers, Government is pursuing with the States to allow  direct  marketing  between  farmers  and  aggregators,  processors,  consumers  through reforms  in  States'  marketing  laws.  To  provide  better  model  with  concept of  'ease  of  doing business',  Government  has  made  this  provision  in  the  Model  Agricultural  Produce  and Livestock Marketing (Promotion & Facilitation) Act, 2017 released on 24 th April, 2017 also for its adoption by the States. In order to enhance transparency in trading and ensure better price discovery to the farmers, Government has already introduced electronic auction platform by launching of e-NAM in April, 2016.

(d): The  other  policy  initiatives/steps/measures    taken  to  boost  the  growth  of  food processing  sector  in  the  country  are:  permitting  100%  FDI  through  automatic  route  in manufacturing of food products and 100% FDI under Government approval route for trading, including through ecommerce, in respect of food products produced and/or manufactured in India, Creation of a special fund of ₹ 2000 crores in National Bank for Agriculture and Rural Development  (NABARD)  to  provide  affordable  credit to food processing industries, classification of food & agro-based processing units and cold chain infrastructure as agricultural activity  for  Priority  Sector  Lending  (PSL),  lower  Goods  &  Services  Tax  (GST)  rates  for majority of food products, 100% exemption of income tax on profit for new food processing units, 100 percent income tax exemption from profit derived by FPOs having annual turnover of Rs.100 crore for activities such as post-harvest value addition to agriculture,  100% deduction of expenditure incurred on investment on establishment and operation of cold chain/warehousing  facility  for  storage of  agricultural  produce,  concessional  import  duty  for plant and machinery under project imports benefit scheme, import duty exemption on import of raw material under advance authorization scheme.

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