Lok Sabha Question No. 3887 (UNSTARRED), answered on 2016-08-09
Subject: Wastage of Agricultural Produce
Ministry: FOOD PROCESSING INDUSTRIES
Asked by: SHIVAJI ADHALRAO PATIL, JAYADEV GALLA, Shrirang Appa Barne, DHARMENDRA YADAV, NIHAL CHAND CHAUHAN, KRUPAL BALAJI TUMANE, SAKSHI SWAMI MAHARAJ, RAJU ALIAS DEVAPPA ANNA SHETTI, M. I. SHANAVAS, HEMANT TUKARAM GODSE, VINAYAK BHAURAO RAUT, RADHESHYAM BISWAS, RAJESHBHAI NARANBHAI CHUDASAMA, S.P. MUDDAHANUMEGOWDA, RAMDAS CHANDRABHANJI TADAS, NISHIKANT  DUBEY, ANANDRAO  ADSUL, SHRIKANT EKNATH SHINDE, V. PANNEER SELVAM, P. KUMAR, ADVOCATE NARENDRA KESHAV SAWAIKAR, S.SELVAKUMARA CHINNAYAN, RAMESH BIDHURI

## GOVERNMENT OF INDIA MINISTRY OF FOOD PROCESSING INDUSTRIES LOK SABHA

## UNSTARRED QUESTION NO. 3887 ANSWERED ON 9 TH  AUGUST, 2016

## WASTAGE OF AGRICULTURAL PRODUCE

## 3887.   SHRI ADHALRAO PATIL SHIVAJIRAO:

SHRI JAYADEV GALLA:

SHRI SHRIRANG APPA BARNE:

SHRI DHARMENDRA YADAV:

SHRI NIHAL CHAND:

SHRI KRUPAL BALAJI TUMANE:

DR. SWAMI SAKSHIJI MAHARAJ:

SHRI RAJU SHETTY:

SHRI M.I. SHANAVAS:

SHRI GODSE HEMANT TUKARAM:

SHRI VINAYAK BHAURAO RAUT:

SHRI RADHESHYAM BISWAS:

SHRI RAJESHBHAI CHUDASAMA:

SHRI S.P. MUDDAHANUME GOWDA:

SHRI RAMDAS C. TADAS:

SHRI NISHIKANT DUBEY:

SHRI ANANDRAO ADSUL:

DR. SHRIKANT EKNATH SHINDE:

SHRI V. PANNEERSELVAM:

SHRI P. KUMAR:

ADV. NARENDRA KESHAV SAWAIKAR:

SHRI S. SELVAKUMARA CHINNAYAN:

SHRI RAMESH BIDHURI:

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

- (a) whether the food processing sector is playing a vital role in processing of various food products,  reducing  wastage  of  farm  produces,  providing  assured  income  to  farmers  and generating employment in the country and if so, the details thereof;
- (b) whether there  is  a  shortage of  basic  facilities  for  processing,  storage,  preservation  and transportation  of  food  products  in  the  country  and  if  so,  the  details  thereof  and  the  reasons therefor  along  with  value  and  volume  of  agricultural  produce,  milk,  meat,  marine  and  poultry products got wasted annually due to lack of such facilities in the country;
- (c) whether the Government has taken several measures to curb the losses in supply chain of agriculture  produce  and  to  improve  the  existing infrastructure  for  food  processing,  cold chain/cold storage, transportation,  preservation  and  storage  facilities  to  prevent  the  wastage  of said food products and meet the growing demand of processed food in the country;

(d) if  so,  the  details  thereof  including  the  funds  allocated,  released  and  utilised  for  the purpose  and the outcome  thereof  along  with  the  cold  storage/cold  chain  infrastructure  created during each of the last three years and the current year, State-wise; and

(e) whether  the  Government  proposes  to  chalk  out  a  road  map  to  set  up  additional  cold storage/cold  chain  projects,  food  processing  industries  and  mega  food  parks  to  meet  their requirement in the food processing sector and if so, the details thereof along with the proposed funding,  incentives  and  packages  for  setting  up  such  projects  in  rural,  backward  and  NorthEastern Region of the country?

## ANSWER

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

(a) Yes,  Madam.  The  growth  rate  of  gross  value  added  in  food  Processing  industries  has increased  from  1.91%  in  2013-14  to  5.78%  in  2014-15  at  constant  prices.  Further,  as  per  the Annual  Survey  of  Industries  2013-14,  the  food  processing  industry  as  compared  to  other industries in the registered sector has the largest number of factories and engages largest number of employees. Further, as per Annual Survey of Industries 2013-14 the total number of persons engaged  in  registered  food  processing  sector  is  17.41  lakh  which  constitutes  11.69  per  cent of employment generated  in  all  registered  factory  sector.  As  per  the  NSSO  67 th Round,  2010-11 unregistered food processing sector provides employment to 47.9 lakh workers.

(b)     Dr. Saumitra Chaudhuri Committee in 2012 constituted by the then Planning Commission had indicated cold storage requirement of 61 million tonnes. The present capacity of cold storage is estimated at around 32 million tonnes in the country.

The Central Institute of Post-Harvest Engineering and Technology (CIPHET), Ludhiana has estimated the annual value of harvest and post-harvest losses of major agricultural produces at national level to be of the order of Rs. 92,651 Crore calculated using production data of 201213  at  2014  wholesale  prices.  Annual  wastage  of  agricultural  produce,  milk,  meat,  marine  and poultry products as assessed by CIPHET is as under:

| Commodity/Crop     | Losses during Transportation (%)   | Losses during Farm Operations (including transportation loss) (%)   | Losses during Storage (%)   | Overall Total Loss (%)   |   Monitory value of the loss (in Rs. crore) |
|--------------------|------------------------------------|---------------------------------------------------------------------|-----------------------------|--------------------------|---------------------------------------------|
| Milk               | 0.02                               | 0.71                                                                | 0.21                        | 0.92                     |                                        4409 |
| Meat               | 0.00                               | 1.99                                                                | 0.72                        | 2.71                     |                                        1235 |
| Marine Fish        | 0.91                               | 9.61                                                                | 0.91                        | 10.52                    |                                        4315 |
| Inland Fish        | 0.17                               | 4.18                                                                | 1.05                        | 5.23                     |                                        3766 |
| Egg                | 0.36                               | 4.88                                                                | 2.31                        | 7.19                     |                                        1320 |
| Poultry Meat       | 0.66                               | 2.74                                                                | 4.00                        | 6.74                     |                                        3942 |
| Cereals            |                                    |                                                                     |                             | 4.65-5.99                |                                       20698 |
| Pulses             |                                    |                                                                     |                             | 6.36-8.41                |                                        3877 |
| Oilseeds           |                                    |                                                                     |                             | 3.08-9.96                |                                        8278 |
| Fruits &Vegetables |                                    |                                                                     |                             | 4.58-15.88               |                                       40811 |

(c) & (d)  To curb the losses in supply chain of agriculture produce and to improve the existing infrastructure  for  food  processing,  the  Ministry  of  Food  Processing  Industries  has  been implementing  the  Schemes  of  Mega  Food  Parks;  Integrated  Cold  Chain,  Value  Addition  and Preservation Infrastructure;  and  Setting  up/  Modernization  of  Abattoirs.  The  scheme  for  Mega Food Parks aims to provide modern Infrastructure for food processing Units in the country on pre-identified  cluster  basis.  Under  the  scheme,  grant-in-aid  is  provided  @  50%  of  the  eligible project  cost  in  general  areas  and  75% thereof  in  difficult  areas  and  hilly  areas  i.e.,  North East Region including Sikkim, J&K, Himachal Pradesh, Uttarakhand and ITDP notified areas of the states,  subject  to  a  maximum  of  Rs.50.00  Crore  per  project.    A  total  of  42  Mega  Food  Park projects  have  been  approved  by  the  Government  to  be  set  up  in  the  country.  The  Scheme  for Setting  up/  Modernization  of  Abattoirs  aims  to  provide  hygienic  finished  meat  and  meat products, slaughter waste management and pollution control. The Scheme envisaged grant-in-aid @ 50%  of  the  project  cost  in  general  areas  and  75%  for  North-  Eastern  region  subject  to  a maximum of Rs.15.00 Crore per project.  So far, 41 Abattoir projects have been sanctioned. The Scheme of Cold Chain, Value  Addition and Preservation Infrastructure  aims at arresting postharvest  losses  of  horticulture  &  non-horticulture  produce  and  providing  remunerative  price  to farmers  for  their  produce.  Under  the  scheme,  financial  assistance  is  provided  in  the  form  of grant-in-aid  of  maximum  Rs.10  Crore  per  project  for  setting  up  of  integrated  cold  chain  and preservation infrastructure facilities without any break from the farm gate to the consumer. The integrated  cold  chain  and  preservation  infrastructure  can  be  set  up  by  individuals,  groups  of entrepreneurs, cooperative societies, Self Help Groups (SHGs), Farmer Producer Organizations (FPOs),  NGOs,  Central/State  PSUs,  etc.  The  scheme  is  primarily  private  sector  driven  and proposals  under  this  scheme  are  invited  through  Expression  of  Interest  (EOI).  The  scheme  is available in all States/UTs and rural & urban areas. So far, 134 Integrated Cold Chain Projects have  been sanctioned  by the Ministry  in  the  country  to  reduce the  cold  chain  gap.  Of  this,  88 Integrated Cold Chain projects have achieved completion and commenced  commercial operation, 46 Integrated Cold Chain projects are in various stages of implementation. The impact of these 134 integrated Cold Chain projects being assisted by Ministry in the country under the Scheme of Cold Chain,  Value  Addition  and  Preservation  Infrastructure  in  respect  of  expected capacity creation is 4.92 Lakh MT of Cold Storage/Controlled Atmosphere/Deep Freezer, 113.90 MT/Hour of Individual Quick Freezer (IQF), 54.65 Lakh Litter Per Day of Milk Storage/Processing and 761 Number of Reefer Vans. Capacity created from 88 completed cold chain projects is 3.31 Lakh MT of Cold Storage/CA/Deep Freezer, 77.15 MT/Hr of Individual Quick  Freezing,31.80  Lakh  Litre  Per  Day  of  Milk  Processing/Storage    and  423  Number  of Reefer Vans. State wise funds are not allotted under the scheme of Cold Chain, Value Addition and  Preservation  Infrastructure.  However,  Details  of  number  of  projects  with  state-wise  and year-wise  funds  released  under  the  scheme  of  Cold  Chain,  value  addition  and  Preservation Infrastructure of Ministry of Food Processing Industries during last three years and the current year are at Annexure-I.

In addition, National Horticulture Mission (NHM), National Horticulture Board (NHB), and National Cooperative Development Corporation (NCDC) under Department of Agriculture, Cooperation and Farmers Welfare, Ministry of Agriculture & Farmers Welfare and Agricultural and  Processed  Food  Products  Export  Development  Authority  (APEDA)  under  Department  of

Commerce,  Ministry  of  Commerce  and  Industries,  Government  of  India  are  also  providing assistance for setting up cold storages under their respective schemes.

Various other incentives provided by the Government to promote creation of cold chain infrastructure are at Annexure-II.

(e) In  addition  to  operationalisation  of  4  Mega  Food  Parks  and  29  Cold  Chain  Projects during 2016-17, Government has also approved setting up of 100 cold chain projects and 250 units under the scheme of creation/expansion of food processing and preservation. The projects set  up  under  the  Schemes  of  this  Ministry  are  granted  financial  assistance  at  a  higher  rate  in difficult areas and North East Region as compared to general areas.

****

ANNEXURE  REFERRED  TO  IN  REPLY  TO  PARTS  (c)  &  (d)  OF  LOK  SABHA UNSTARRED  QUESTION  NO.  3887  FOR  ANSWER  ON  09 TH AUGUST,  2016 REGARDING WASTAGE OF AGRICULTURAL PRODUCE

## Details of number of units with state-wise and year-wise funds released (in Crore) under the scheme of Cold Chain, value addition and Preservation Infrastructure.

| Name of the state   | 2013-14   | 2013-14   | 2014-15   | 2014-15   | 2015-16   | 2015-16   | 2016-17*   | 2016-17*   |
|---------------------|-----------|-----------|-----------|-----------|-----------|-----------|------------|------------|
| Name of the state   | Nos.      | Amount    | Nos.      | Amount    | Nos.      | Amount    | Nos.       | Amount     |
| Andhra Pradesh      | 2         | 4.28      | 0         | 0         | 2         | 4.00      | 0          | 0          |
| Arunachal Pradesh   | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Assam               | 0         | 0         | 2         | 6.54      | 2         | 2.27      | 0          | 0          |
| Bihar               | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Chhattisgarh        | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Gujarat             | 2         | 3.49      | 3         | 12.05     | 3         | 10.31     | 1          | 3.87       |
| Haryana             | 1         | 21.37     | 2         | 19.35     | 2         | 10.28     | 3          | 8.63       |
| Himachal Pradesh    | 3         | 10.50     | 3         | 6.57      | 4         | 18.02     | 2          | 3.12       |
| Jammu &Kashmir      | 0         | 0         | 2         | 4.80      | 2         | 16.06     | 2          | 4.80       |
| Jharkhand           | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Karnataka           | 1         | 2.08      | 2         | 7.38      | 2         | 1.97      | 0          | 0          |
| Kerala              | 1         | 4.80      | 0         | 0         | 0         | 0         | 0          | 0          |
| Madhya Pradesh      | 1         | 2.37      | 2         | 5.50      | 2         | 3.89      | 1          | 2.50       |
| Maharashtra         | 6         | 9.96      | 11        | 27.66     | 13        | 36.84     | 8          | 22.06      |
| Manipur             | 1         | 5.00      | 1         | 2.45      | 0         | 0         | 0          | 0          |
| Meghalaya           | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Mizoram             | 2         | 8.00      | 2         | 2.49      | 0         | 0         | 0          | 0          |
| Nagaland            | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Odisha              | 0         | 0         | 1         | 0.566     | 1         | 0.92      | 0          | 0          |
| Punjab              | 4         | 13.67     | 3         | 10.32     | 4         | 12.67     | 2          | 5.00       |
| Rajasthan           | 0         | 0         | 1         | 2.02      | 3         | 9.22      | 2          | 2.95       |
| Sikkim              | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Tamil Nadu          | 1         | 1.79      | 0         | 0         | 0         | 0         | 0          | 0          |
| Telangana           | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Tripura             | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Uttar Pradesh       | 3         | 4.94      | 3         | 7.50      | 2         | 10.69     | 1          | 1.99       |
| Uttarakhand         | 1         | 2.25      | 7         | 37.43     | 5         | 14.52     | 2          | 5.00       |
| West Bengal         | 2         | 7.26      | 1         | 0.433     | 2         | 7.3       | 1          | 1.65       |
| Andaman &Nicobar    | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Chandigarh          | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Dadar& Nagar Haveli | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Damn and Diu        | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Lakshadweep         | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Delhi               | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Puducherry          | 0         | 0         | 0         | 0         | 0         | 0         | 0          | 0          |
| Total               | 31        | 101.76    | 46        | 153.059   | 49        | 158.96    | 25         | 61.57*     |

## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PARTS  (c)  &  (d)  OF  LOK  SABHA UNSTARRED  QUESTION  NO.  3887  FOR  ANSWER  ON  09 TH AUGUST,  2016 REGARDING WASTAGE OF AGRICULTURAL PRODUCE

## 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.