Lok Sabha Question No. 1477 (UNSTARRED), answered on 2015-12-08
Subject: Food Processing Facilities
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: BIDYUT BARAN MAHATO, RAJESHBHAI NARANBHAI CHUDASAMA, BAIJAYANT "JAY" PANDA, PRITAM GOPINATH MUNDE, C.R. CHAUDHARY, MAHENDRA NATH PANDEY, FEROZE VARUN GANDHI, RAVNEET SINGH, SANTOSH AHLAWAT, ALOK SANJAR, SUMEDHANAND SARASWATI

## GOVERNMENT OF INDIA MINISTRY OF FOOD PROCESSING INDUSTRIES

## LOK SABHA UNSTARRED QUESTION NO.1477

ANSWERED ON 8 TH  DECEMBER, 2015.

## FOOD PROCESSING FACILITIES

1477. SHRI BIDYUT BARAN MAHATO:

SHRI RAJESHBHAI CHUDASAMA:

SHRI BAIJAYANT JAY PANDA:

DR. PRITAM GOPINATH MUNDE:

SHRI C.R. CHAUDHARY:

DR. MAHENDRA NATH PANDEY:

SHRI FEROZE VARUN GANDHI:

SHRI RAVNEET SINGH:

SHRIMATI SANTOSH AHLAWAT:

SHRI ALOK SANJAR:

SHRI SUMEDHANAND SARSWATI:

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

- (a)  the  number  of  projects  sanctioned  for  establishment  and  promotion  of  food  processing industries  in  the  country  and  the  number  of  food  processing  units  have  been  closed  in  the country, State/UT-wise;
- (b) whether the Government has conducted any survey for ascertaining the growth possibility of the  food processing  industries  in  the  country  and  if  so,  the  details  thereof  along  with  the requirement of food processing facilities across the country;
- (c)  the  details  of  research  and  development  projects  undertaken  for  the  promotion  of  food processing industries  and  the  funds  sanctioned,  allocated  and utilised  for the  purpose during each of the last three years;
- (d)  whether  foreign  direct  investment  (FDI)  for  setting  up  food processing  industries  in  the country has increased during the said period and if so, the details thereof and its impact of the growth of FPI; and
- (e)  whether  the  Government  has  announced  any  new  incentives  to  promote  food  processing industries in various parts of the country and if so, the details thereof along with the details of food processing units likely to be set up during 2015-16 to prevent loss of fruits and vegetables in view of heavy rise in their production in the country?

## ANSWER

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

(a):  For promotion and development of food processing sector in the country, the Government is  implementing  various  Central  Sector  Schemes,  namely  (1)  Scheme  for  Infrastructure Development for Food Processing having components of (i) Mega Food Parks (ii) Integrated

Cold Chain, Value Addition and Preservation Infrastructure and (iii) Setting-up/ Modernization of Abattoirs (subsumed in NMFP w.e.f. 01.04.2014); (2) Scheme of Technology Up-gradation /  Establishment  /  Modernization  of  Food  Processing  Industries  (spill-over  liabilities);  (3) Scheme  for  Quality  Assurance,  Codex  Standards,  Research  &  Development  and  Other Promotional  Activities;  (4)  Scheme  for  Human  Resource  Development  and  (5)  Scheme  of Strengthening of Institutions.

During the 12 th Five  Year Plan,  the Government  also  launched  Centrally  Sponsored Scheme of  'National  Mission on  Food  Processing'  (NMFP)  for  implementation  through  the State  Governments / Union Territories.  The components of the NMFP were (i) Technology Up-gradation / Setting up / Modernization  of Food Processing Units, (ii) Cold Chain, Value Addition  and  Preservation  Infrastructure  for  Non-Horticulture  Products,  (iii)  Setting-up  / Modernization  of  Abattoirs  (w.e.f.  01.04.2014),  (iv)  Human  Resource  Development,  (v) Promotional Activities, (vi) Creating Primary Processing Centers / Collection Centers in Rural Areas,  (vii)  Modernization  of  Meat  Shops,  (viii)  Reefer  Vehicles  and  (ix)  Food  Parks  (Old Scheme).   However, NMFP has been delinked from Central Government support w.e.f. 01-042015  except  for  UTs.    The  State  Governments  may  decide  to  continue  (or  not)  with  the Mission  out  of  their  increased  resources  resulting  from  the  recommendations  of  the  14 th Finance Commission.

The  Scheme-wise  and  State-wise  number  of  projects  sanctioned  under  the  various Schemes during 11 th and 12 th Five Year Plans by this Ministry is at Annexure. This Ministry does not maintain the record of food processing units that have been closed in the country.

(b):   Ministry has not conducted any survey for ascertaining the growth possibility of the food processing industries in the country.  However, as per the latest National Accounts Statisitcs2015 of Central Statistics Office, the food processing sector constitutes 9.0 and 10.1 per cent of GDP  in  Manufacturing  and  Agriculture  sector  respectively  in  2014-15.    Food  Processing Industries sector has grown at 7.1 per cent during the same period.

In order to promote food processing industries, increase level of processing and exploit the  potential  of  domestic  and  international  market  for  processed  food  products,  Vision Document 2015 was prepared by the Ministry. It envisaged trebling the size of investment in the processed food sector by increasing the level of processing of perishables form 6% to 20%, value addition from 20% to 35% and share in global food trade from 1.5% to 3% by 2015. To achieve these targets, an investment of Rs. 100,000 crore was required by the year 2015. Out of which, the share of Government was Rs. 10,000 crore.

(c):        The  Number of research and development projects sanctioned and the funds allocated and  grant-in-aid  released/utilized  by  the  Ministry  during  each  of  the  last  three  years  are  as under :-

(Rs. in lakh)

| Sl. No.   | Year      |   No. of Projects sanctioned |   Funds allocated under R&D scheme |   Total Grant-in-Aid released/utilized under R&D scheme |
|-----------|-----------|------------------------------|------------------------------------|---------------------------------------------------------|
| 1.        | 2012-2013 |                           43 |                             1030   |                                                 1026.67 |
| 2.        | 2013-2014 |                           50 |                             1102   |                                                 1097.73 |
| 3.        | 2014-2015 |                           58 |                              760.5 |                                                  638.66 |
|           | Total     |                          151 |                             2892.5 |                                                 2763.06 |

(d):    Foreign  Direct  Investment  is  permitted  in  the  food  processing  upto  100%  through automatic  route.  Foreign  Direct  Investment  (FDI)  inflow  in  Food  Processing  sector  in  the country during the last 3 years is as under:

| S. No.                                                        | Year                                                          | FDI inflow (US $ Million)                                     |
|---------------------------------------------------------------|---------------------------------------------------------------|---------------------------------------------------------------|
| 1                                                             | 2012-13                                                       | 401.46                                                        |
| 2                                                             | 2013-14                                                       | 3,982.88                                                      |
| 3                                                             | 2014-15                                                       | 515.86                                                        |
| Source: Department of Industrial Policy and Promotion (DIPP). | Source: Department of Industrial Policy and Promotion (DIPP). | Source: Department of Industrial Policy and Promotion (DIPP). |

(e):      With  a  view  to  promote  food  processing  sector  in  the  country,  the  Government  has created  a  Special  Fund  of  Rs.  2000  crore  in  National  Bank  for  Agriculture  and  Rural Development (NABARD) to provide affordable credit to the food processing industries in the designated food parks.

Reserve Bank of India has also classified loan to food & agro-based processing units and  Cold  Chain  under  Agriculture  activities  for  Priority  Sector  Lending  (PSL)  subject  to aggregate sanctioned limit of Rs. 100 crore per borrower for ensuring greater flow of credit to entrepreneurs for setting up of food processing units and attract investment in the sector.

Excise duty on food processing and packaging machinery has been reduced from 10% to 6%.

Services of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labelling of fruits & vegetables have been exempted from Service Tax.

The above incentives are likely to give boost to setting up of food processing units and to prevent loss of fruits and vegetables in the country.

*****

## ANNEXURE  REFERRED  IN  REPLY  TO  PART  (a)  OF  LOK  SABHA  UNSTARRED  QUESTION  NO.1477  FOR  8TH  DECEMBER,  2015 REGARDING FOOD PROCESSING FACILITIES

Details of the number of projects sanctioned under various Schemes during 11th and 12th Five Year Plans

|         |                          | Number of Projects Sanctioned   | Number of Projects Sanctioned                                             | Number of Projects Sanctioned                 | Number of Projects Sanctioned   | Number of Projects Sanctioned   | Number of Projects Sanctioned                                                                | Number of Projects Sanctioned              |
|---------|--------------------------|---------------------------------|---------------------------------------------------------------------------|-----------------------------------------------|---------------------------------|---------------------------------|----------------------------------------------------------------------------------------------|--------------------------------------------|
| Sl. No. | State/UT                 | Mega Food Parks Scheme          | Integrated Cold Chain, Value Addition& Preservation Infrastructure Scheme | Setting-up/ Modernisation of Abattoirs Scheme | Food Testing Laboratory Scheme  | Research& Developmen t Scheme   | Technology Up- gradation / Establishment/ Modernization of Food Processing Industries Scheme | National Mission on Food Processing (NMFP) |
| 1       | Andhra Pradesh           | 3                               | 5                                                                         | 1                                             | 1                               | 3                               | 778                                                                                          | 6                                          |
| 2       | Andaman &Niconbar        | 0                               | 0                                                                         | 0                                             | 0                               | 0                               | 0                                                                                            | 3                                          |
| 3       | Arunachal Pradesh        | 0                               | 1                                                                         | 1                                             | 0                               | 0                               | 6                                                                                            | 10                                         |
| 4       | Assam                    | 1                               | 2                                                                         | 0                                             | 1                               | 19                              | 116                                                                                          | 31                                         |
| 5       | Bihar                    | 3                               | 2                                                                         | 1                                             | 0                               | 1                               | 33                                                                                           | 3                                          |
| 6       | Chandigarh               | 0                               | 0                                                                         | 0                                             | 0                               | 0                               | 10                                                                                           | 0                                          |
| 7       | Chhattisgarh             | 1                               | 2                                                                         | 1                                             | 0                               | 1                               | 384                                                                                          | 11                                         |
| 8       | Daman& Diu               | 0                               | 0                                                                         | 0                                             | 0                               | 0                               | 2                                                                                            | 0                                          |
| 9       | Delhi                    | 0                               | 0                                                                         | 0                                             | 6                               | 13                              | 39                                                                                           | 0                                          |
| 10      | Goa                      | 0                               | 0                                                                         | 1                                             | 0                               | 0                               | 19                                                                                           | 0                                          |
| 11      | Gujarat                  | 2                               | 10                                                                        | 0                                             | 9                               | 3                               | 517                                                                                          | 75                                         |
| 12      | Haryana                  | 1                               | 8                                                                         | 2                                             | 7                               | 14                              | 294                                                                                          | 22                                         |
| 13      | Himachal Pradesh         | 1                               | 8                                                                         | 1                                             | 1                               | 2                               | 81                                                                                           | 21                                         |
| 14      | Jammu &Kashmir           | 1                               | 4                                                                         | 2                                             | 2                               | 1                               | 44                                                                                           | 22                                         |
| 15      | Jharkhand                | 1                               | 0                                                                         | 1                                             | 1                               | 4                               | 26                                                                                           | 0                                          |
| 16      | Karnataka                | 1                               | 4                                                                         | 4                                             | 2                               | 29                              | 428                                                                                          | 64                                         |
| 17      | Kerala                   | 2                               | 3                                                                         | 1                                             | 2                               | 2                               | 277                                                                                          | 23                                         |
| 18      | Madhya Pradesh           | 2                               | 4                                                                         | 0                                             | 3                               | 0                               | 176                                                                                          | 43                                         |
| 19      | Maharashtra              | 4                               | 28                                                                        | 2                                             | 13                              | 23                              | 1107                                                                                         | 89                                         |
| 20      | Manipur                  | 0                               | 1                                                                         | 0                                             | 1                               | 0                               | 72                                                                                           | 37                                         |
| 21      | Megalaya                 | 0                               | 0                                                                         | 0                                             | 0                               | 3                               | 12                                                                                           | 13                                         |
| 22      | Mizoram                  | 1                               | 2                                                                         | 1                                             | 0                               | 0                               | 1                                                                                            | 11                                         |
| 23      | Nagaland                 | 0                               | 0                                                                         | 2                                             | 1                               | 0                               | 10                                                                                           | 7                                          |
| 24      | Odhisha                  | 2                               | 2                                                                         | 0                                             | 1                               | 0                               | 69                                                                                           | 32                                         |
| 25      | Puducheery               | 0                               | 0                                                                         | 1                                             | 0                               | 1                               | 8                                                                                            | 3                                          |
| 26      | Punjab                   | 3                               | 12                                                                        | 2                                             | 5                               | 11                              | 610                                                                                          | 9                                          |
| 27      | Rajasthan                | 2                               | 4                                                                         | 1                                             | 1                               | 1                               | 482                                                                                          | 79                                         |
| 28      | Sikkim                   | 0                               | 0                                                                         | 3                                             | 1                               | 0                               | 0                                                                                            | 1                                          |
| 29      | Tamil Nadu               | 0                               | 2                                                                         | 2                                             | 8                               | 32                              | 407                                                                                          | 5                                          |
| 30      | Telangana                | 3                               | 1                                                                         | 1                                             | 3                               | 8                               | 0                                                                                            | 3                                          |
| 31      | Tripura                  | 1                               | 0                                                                         | 0                                             | 1                               | 2                               | 3                                                                                            |                                            |
|         |                          |                                 |                                                                           |                                               |                                 |                                 |                                                                                              | 3                                          |
| 32 33   | Uttar Pradesh Uttrakhand | 0 2                             | 9                                                                         | 1                                             | 6                               | 7                               | 422                                                                                          | 46                                         |
|         |                          |                                 | 15                                                                        | 0                                             | 0                               | 0                               | 62                                                                                           | 5                                          |
| 34      | West Bengal              | 1                               | 9                                                                         | 8                                             | 6                               | 10                              | 154                                                                                          | 67                                         |
|         | Total                    | 38                              | 138                                                                       | 40                                            | 82                              | 190                             | 6649                                                                                         | 744                                        |