Lok Sabha Question No. 221 (UNSTARRED), answered on 2026-01-29
Subject: Financial  Assistance for Upgradation of Micro Food Processing Units
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: Shri Neeraj Maurya, Shri Devesh Shakya

## GOVERNMENT OF INDIA

## MINISTRY OF FOOD PROCESSING INDUSTRIES

## LOK SABHA

## UNSTARRED QUESTION No. 221

ANSWERED ON 29 TH  JANUARY, 2026

## FINANCIAL ASSISTANCE FOR UPGRADATION OF MICRO FOOD PROCESSING UNITS

## 221. SHRI NEERAJ MAURYA: SHRI DEVESH SHAKYA:

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

- (a) whether  financial  assistance  has  been  provided  for  the  upgradation  of  micro  food processing units in Etah-Kasganj, Aonla and Jaunpur Parliamentary Constituencies under the  Pradhan  Mantri  Formalisation  of  Micro  Food  Processing  Enterprises  (PMFME) scheme;
- (b) if so, the details of the total number of applications received, approved and the number of units actually set up/upgraded in the said Constituencies during the last three years, districtwise;
- (c) whether several eligible beneficiaries have not been able to avail complete benefits of the scheme due to delays in approval of bank loans, lack of technical assistance or lack of market linkages and if so, the details thereof;
- (d) the specific steps taken by the Government to promote processing, branding and marketing of local produces under the One District One Product (ODOP) based approach; and
- (e) whether  the  Government  is  considering  to  have  a  special  review  and  time  bound interference  for  the  effective  implementation  of  above  said  scheme  in  the  aforesaid Parliamentary Constituencies and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE FOR FOOD PROCESSING INDUSTRIES (SHRI RAVNEET SINGH)

(a) & (b): The details of financial assistance eligible for micro food enterprises under Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) Scheme across the country including Etah-Kasganj, Aonla and Jaunpur Parliamentary Constituencies are at Annexure-I. The district-wise  details  for  total  applications  received,  sanctioned  and  disbursed  in  the  said constituencies during last three years is at Annexure-II .

(c): The success rate of sanctioning by the lending banks is 42% which is at par with most of the government sponsored Credit Linked Schemes. The bank sanctions the projects based on their policy, however regular meetings are held with lending banks and State Government to address the problems being faced by micro food processing enterprises. Support to upgrade existing units or setting up of new micro units is provided through a credit linked grant @ 35% with maximum grant of Rs.10 lakh. The Scheme also provides support to food processing units of SHGs/ FPOs/ Cooperatives  for  credit-linked  subsidy  @  35%,  Seed  Capital  to  Self  Help  Groups  (SHGs), Incubation Centre, Common Infrastructure, Branding & Marketing and Capacity Building.  Under the  Branding  and  Marketing  component,  support  is    provided  to  groups  of  FPOs,  SHGs, cooperatives, or Special Purpose Vehicles (SPVs) of micro food processing enterprises, with a grant of upto 50% of the eligible project cost, following the cluster approach for developing a common brand with provision for quality control, standardisation, packaging and adhering to food safety parameters for consumer retail sale.

In addition to this, District Resource Persons (DRPs) are also engaged at the district level by the States to provide continuous handholding support to beneficiaries.

(d): Under the One District One Product (ODOP) approach of PMFME Scheme, Support to upgrade existing units or setting up of new micro units is provided through a credit linked grant @ 35% with maximum grant of Rs.10 lakh. The Scheme also provides support to food processing units of SHGs/ FPOs/ Cooperatives for credit-linked subsidy@35%, Seed Capital to Self Help Groups (SHGs), Incubation Centre, Common Infrastructure, Branding & Marketing and Capacity Building.

The scheme provides grant-in-aid through its Branding and Marketing support to help micro food processing enterprises with limited market access to boost the visibility and sales of their products.  This  is  achieved  through  strategic  tie-ups  with  regional  and  national  retail  chains. Memorandum of Understanding (MoU) with Government e-Marketplace (GeM) portal has been done  to  facilitate  marketing  of  products  manufactured  by  the  units  supported  under  PMFME Scheme.

(e): Ministry regularly conducts meeting with lending banks and State Government. The issues being faced by micro food processing enterprises are also raised at the Department of Financial Services (DFS) level and in the State Level Bankers Committee (SLBC) meetings to discuss and resolve implementation challenges. Further, periodic review meetings are also conducted at state and district level by the State government.

Monitoring is further strengthened through the PMFME Management Information System (MIS),  which  captures  district-wise  data  on  applications  received,  loans  sanctioned,  funds disbursed, and unit-level outcomes.

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ANNEXURE REFERRED TO IN REPLY TO PART (a) & (b) OF THE LOK SABHA UNSTARRED  QUESTION  NO.  221  FOR  ANSWER  ON  29.01.2026  REGARDING 'FINANCIAL ASSISTANCE FOR UPGRADATION OF MICRO FOOD PROCESSING UNITS'

The details of financial assistance offered to the enterprises under Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) Scheme are as under:

- (i). Support to  Individual  /  Group  Category  Micro  Enterprises: Credit-linked  capital  subsidy @35% of the eligible project cost, maximum ceiling Rs.10 lakh per unit;
- (ii). Support to SHGs for seed capital: Seed capital @ Rs. 40,000/- per member of SHG engaged in food processing for working capital and purchase of small tools subject to maximum of Rs. 4 lakh per SHG Federation.
- (iii). Support for Common Infrastructure: Credit  linked  capital  subsidy  @35% of the  eligible project cost subject to maximum of Rs. 3 crore to support FPOs, SHGs, Cooperatives and any Government agency for setting up of common infrastructure. The common infrastructure will also be available for other units and public to utilize on hiring basis for substantial part of the capacity. (iv). Branding and Marketing Support: Grant upto 50% for Branding and Marketing to groups of FPOs/ SHGs/ Cooperatives or an SPV of micro food processing enterprises.
- (v). Capacity  Building: The  scheme  envisages  training  for  Entrepreneurship  Development Skilling (EDP) program modified to meet the requirement of food processing industry.

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ANNEXURE-II

## ANNEXURE REFERRED TO IN REPLY TO PART (a) & (b) OF THE LOK SABHA UNSTARRED QUESTION NO. 221 FOR  ANSWER  ON  29.01.2026  REGARDING  'FINANCIAL  ASSISTANCE  FOR  UPGRADATION  OF  MICRO  FOOD PROCESSING UNITS'

|         |            | FY 2022-23               | FY 2022-23        | FY 2022-23     | FY 2023-24             | FY 2023-24        | FY 2023-24       | FY 2024-25             | FY 2024-25        | FY 2024-25       |
|---------|------------|--------------------------|-------------------|----------------|------------------------|-------------------|------------------|------------------------|-------------------|------------------|
| s. N o. | Dist ricts | Applications submitted d | Loans Sanctione d | Loans Disburse | Applications submitted | Loans Sanctione d | Loans Disburse d | Applications submitted | Loans Sanctione d | Loans Disburse d |
| 1       | Bare illy  | 100                      | 43                | 19             | 280                    | 152               | 100              | 307                    | 133               | 125              |
| 2       | Bud aun    | 23                       | 5                 | 3              | 51                     | 15                | 6                | 79                     | 26                | 18               |
| 3       | Etah       | 36                       | 6                 | 5              | 98                     | 32                | 29               | 69                     | 29                | 23               |
| 4       | Jaun pur   | 60                       | 33                | 11             | 325                    | 186               | 163              | 254                    | 94                | 79               |
| 5       | Kas ganj   | 50                       | 5                 | 1              | 232                    | 55                | 49               | 85                     | 12                | 12               |

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