Lok Sabha Question No. 2934 (UNSTARRED), answered on 2016-03-15
Subject: Flagship Programme in FPIs
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: RAYAPATI SAMBASIVA RAO

## GOVERNMENT OF INDIA

## MINISTRY OF FOOD PROCESSING INDUSTRIES LOK SABHA UNSTARRED QUESTION NO.2934 ANSWERED ON 15 ST  MARCH, 2016.

## FLAGSHIP PROGRAMME IN FPIs

## 2934.   SHRI RAYAPATI SAMBASIVA RAO:

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

- (a) the major flagship programme of the Ministry and the status of food processing industries in the country;
- (b) whether any efforts have been made to improve storage facilities of fruits and vegetables in the food processing industries during the last three years and the current year;
- (c) if so, the details thereof; and
- (d) if not, the reasons therefor?

## ANSWER

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

(a) For  the  development  of  food  processing  industries  in  the  country,  the  Ministry  is implementing a  major  flagship Central Sector Scheme of Infrastructure Development for food processing having components  of Mega  Food  Parks, Cold Chain, Value Addition and Preservation  Infrastructure  and  Setting  up  /  Modernization  of  Abattoirs.  As  per  latest  Annual Survey Industries: 2012-13, the total number of factories in the registered food processing sector in  the  country  was  37,175.  In  terms  of  investment  in  fixed  capital,  registered  food  processing sector is growing annually at an average of 18.47 per cent during five years ending 2012-13. As per latest, ASI 2012-13, the Fixed Capital in food processing industries was at ₹ 1,58,865 crore.

(b) & (c) For setting up of integrated cold chain and preservation infrastructure facilities in the country,  Ministry  of  Food  Processing  Industries  is  implementing  a  Central  Sector  Scheme  of Cold  Chain,  Value  Addition  and  Preservation  Infrastructure  since  2008.  Under  the  scheme, financial assistance @ 50% of the total cost of plant & machinery and technical civil works in general  areas  and  75%  for  NE  region  and  difficult  areas  (North  Eastern  states,  Sikkim,  J&K, Himachal Pradesh and Uttarakhand) subject to a maximum grant-in-aid of ₹ 10 crore per project is  provided  for  setting  up  the  cold  chain  infrastructure.  Under  this  scheme,  a  total  66  projects with 2,92,391 metric tonne storage capacity for fruits and vegetables have been sanctioned by the Ministry  during  the  last  three  years  and  the  current  year.  In  addition,  30850  MT  cold  storage capacity for fruits and vegetables, have been created in 7 operational Mega Food Parks projects under the Scheme of Mega Food Parks of this Ministry.

Government is also providing various other incentives to promote creation of cold chain infrastructure in the country as detailed in Annexure.

- (d) Does not arise.

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## ANNEXURE

## ANNEXURE REFERRED TO IN REPLY TO PART (b) & (c) OF THE LOK SABHA UNSTARRED QUESTION NO.2934 FOR 15 TH  MARCH, 2016 REGARDING FLAGSHIP PROGRAMME IN FPIs .

## Details of various other incentives provided by the Government to the Cold Chain Sector

-  Services  of  pre-conditioning,  pre-cooling,  ripening,  waxing,  retail  packing,  labeling  of fruits and vegetables have been exempted from Service Tax in Budget 2015-16.
-  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.
-  Under Section 35-AD of the Income tax Act 1961, deduction to the extent of 150% is allowed  for  expenditure  incurred  on  investment  for  (i)  setting  up  and  operating  a  cold chain  facility;  and  (ii)  setting  up  and  operating  warehousing  facility  for  storage  of agricultural produce.
-  Government has extended Project Imports benefits to cold storage, cold room (including for farm level pre-cooling) or industrial projects for preservation, storage or processing of agricultural,  apiary,  horticultural,  dairy,  poultry,  aquatic  and  marine  produce  and  meat. Consequently,  all  goods  related  to  Food  Processing,  imported  as  part  of  the  project, irrespective  of  their  tariff  classification,  would  be  entitled  to  uniform  assessment  at concessional basic customs duty of 5%.
-  Refrigeration  machineries and parts used  for installation  of  cold  storage,  cold  room  or refrigerated vehicle, for the preservation, storage, transport or processing of agricultural, apiary,  horticultural,  dairy,  poultry,  aquatic  and  marine  produce  and  meat  under  Tariff Head: Chapter 84 are exempted from Excise Duty.
-  Construction, erection, commissioning or installation of original works pertaining to postharvest  storage  infrastructure  for  agricultural  produce  including  cold  storages  for  such purposes are exempted from Service tax.
-  Capital investment in the creation of modern storage capacity has been made eligible for Viability  Gap  Funding  scheme  of  the  Finance  Ministry.  Cold  chain  and  post-harvest storage has been recognized as an infrastructure sub-sector.