Saurabh Gupta | 23 Jun, 2009
The food processing sector is eligible for another term of 10 years tax holiday, opined Subodh Kant Sahai, Union Minister for Food Processing Industries (MoFPI), at a conference in New Delhi on Monday.

The remark comes just a few days before the Union Budget, when he was speaking at the 2nd Food Technology Summit 2009: Innovative approaches and Technical Solutions for sustained profitability held jointly by Confederation of Indian Industry (CII) and Ministry of Food Processing Industries (MoFPI).

At the summit, it was emphasized that government has to give a serious look at the food processing sector so as to attract new investments to address the growing wastage and spoilage of food in India. While there is a huge domestic market for food in India, around 30 percent of food products goes waste, the estimated investment to the required extent is not coming forward either by public or private sector.

The minister urged the Planning Commission to look at food processing sector on a priority basis and develop a national programme for food processing sector in order to ensure preservation of agricultural produce, storage infrastructure to support farmers under distress.

"Properly developed storage and processing infrastructure will prevent suicide of farmers and processing and packaging infrastructure will also ensure safe and balanced diet for consumers. These activities will also generate rural employment."

The minister outlined that the food processing sector needs investments worth Rs.100 crore. The sector has the potential to grow manifolds, generate employment by targeting 70% rural population and setting examples of entrepreneurship.

He suggested forming mobile processing units for agricultural produce, which can cover a wider domain. He proposed that every state must have a separate food processing technology policy.

Dr. V Prakash, Director, Central Food Technological Research Institute said attaining rural-urban balance is critical to achieve 6% growth rate target for the sector. He suggested that entrepreneurship is the way to go for this sector and the farmers should be linked to the market in order to achieve optimal results in food processing.

He put forward that PPP arrangements should be termed as private public partnership, where the private arm has the authority to come out and actively take initiatives. The sector will depend upon skill development and capacity building.

Delivering the theme address, Gautam Mukkavilli, Chairman - CII National Committee on Food Processing & Food Regulatory Affairs and CEO - India Foods & President - India Region PepsiCo India Holdings Pvt Ltd, said that the policy framework should be such that India gains and retains market share globally. Towards this affect, the government aims to setup ten food technology and entrepreneurship incubation centre in 2009 and 20 Food Technology Parks in 2010.

The food processing sector is the growth engine of the economy, which received investments worth $144 million in 2007-08 as against $5.7 million the previous year. During April 2008-January 2009, the sector received $760 million investments. India will register 443% increase in mass grocery retail during 2007-2012.