The government said that the food processing industry has invested Rs 4,900 crore so far under the production-linked incentive (PLI) scheme. The PLI scheme for the food processing industry was approved in March 2021, with a budget outlay of Rs 10,900 crore. It will be implemented for seven years, until 2026-27.
More About This Development:
A total of 182 applications have been approved under the PLI scheme for the food processing industry. This includes 30 applications for millets-based products under the PLI scheme (8 large entities and 22 SMEs). Incentives amounting to Rs 800 crore are likely to be disbursed in the current financial year. Sales-based incentive of Rs 107.3 crore has been disbursed so far.
PLI beneficiaries’ investments are likely to increase sales and exports of food products. The scheme requires that the entire chain of manufacturing processes, including primary processing of food products, take place in India in order to qualify for the incentive, which is expected to boost domestic industry. It was also stated that the scheme will aid in the promotion of Indian brands abroad.
The ministry stated that a total of 112 food processing projects were completed and operationalised during 2022, leveraging private investment of Rs 706.04 crore and generating direct and indirect employment for 25,293 people. During the year, approximately 190 food processing projects were approved.
About Food Processing Industry:
Food processing is the transformation of raw ingredients into food, or of food into other forms (ie. food processing may denote direct manufacturing of food or value addition on existing food). Food processing typically takes harvested crops or butchered animal products and uses these to produce long shelf-life food products.
Why are food processing industries significant:
- India is a land famous for food production. More than 50% of the Indian population work in Agriculture related activities. If there are good food processing industries in India, raw materials like grains or meat can be converted into food for domestic and foreign consumption.
- Food processing units acts as a link between agriculture and industries.
- Food processing industries can absorb a major share of workers from the agriculture sector, who face disguised unemployment. It can lead to better productivity and GDP growth.
- Food processing prevents food wastage and helps in attaining food security.
- Processed food requires less space for storage.
- Processed food can be exported. This may help us in getting foreign exchange reserves.