Growth in food processing industries

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PIB Features | 23 Feb, 2009
India stands first in the production of milk, tea and pulses and is the second largest producer of fruits and vegetables, rice, wheat and sugarcane. India currently produces about 50 Million Tonnes of fruits, which is about 9% of world production and 90 Million Tonnes of vegetables accounting for 11% of world production. In spite of the strong raw material base, only about 2% of fruits and vegetables, 35% of milk, 26% for marine, 6% of poultry and 20% of buffalo meat are processed in India. A developed food processing industry would not only reduce wastages but would fetch remunerative income to farmers. Food Processing Sector has also tremendous export potential. Presently, India’s share of global agriculture export is around 1.6%. In the last five years, the exports of processed food items have grown from Rs. 33,000 crores to Rs. 50,000 crores.

Growth of the Food Processing sector has gone up from 7% in 2002-03 to 13.14% in 2006-07. The sector contributes 16% to the manufacturing GDP amounting to Rs. 2,80,000 crores. Food processing sector generates significant employment. The multiplier effect of investment in food processing industry on employment generation is 2.5 times more than in other industrial sectors, higher than any other sector. During last five years direct employment has grown from 3.9 million to 4.4 million. Indirect employment has grown from 6 million to 9 million.

The processing level in the FPI sector has gone up from 6% to 10 % during last five years and during the next five years, the processing level is expected to reach 20%.

Value addition in the food processing sector has also gone up from 20% to 26% in the last five years and during next five years, value addition is expected to go up from 26% to 35%.

Wastage of perishable commodities has gone down from Rs.58000 crores to Rs.50,000 crores per annum in the last 5 years and during next five years, the wastage is expected to be further reduced to Rs.35,000 crores per annum.

The growth rate of FPI units has risen from 7% to 13.14% p.a. in the last five years and it is expected to go up to 20% in next five years.

Contribution to GDP:
While the Contribution to the manufacturing is expected to go up to 18% the director and indirect employment is likely to shoot up to 13.4 million.

Vision for FPI Sector:
A Vision, strategy and action plan has been finalized for giving boost to growth of food processing sector. The Vision envisages increase in level of processing of perishable food from 6% to 20%, value addition from 20% to 35% and share in global food trade from 1.6% to 3%. The level of processing for fruits and vegetables is envisaged to increase from the present 2.2% to 10% and 15% in 2010 and 2015 respectively. The Cabinet has approved the integrated strategy for promotion of agribusiness-Vision, Strategy and Action Plan for the Food Processing Sector, based on the recommendations made by the Group of Ministers (GOM) for growth of Food Processing Sector.

Food Park:
15 Food Park Schemes were approved at a cost of Rs.57.35 crore in last five years. Each Food Park is expected to generate 5000 direct employment and 25 – 30 thousand indirect employment.

Mega Food Park:
In the 11th Five Year Plan, the Ministry has launched the Scheme of Mega Food Park, which is expected to have an average project cost of about Rs.150 crore. Out of this, upto Rs.50 crores would be funded as a grant by MFPI. This will leverage further investment of about Rs.250 crore in one Mega Food Park by way of setting up 30-35 business units.

In the first phase, 10 States have been identified for setting up of Mega Food Park such as Andhra Pradesh, Jharkhand, Karnataka, Maharashtra, Punjab, Tamil Nadu, UP, Uttrakhand, West Bengal and North East. In next five years, all the States & Union Territories would be covered under this Scheme.

Abattoir:
During 11th Plan, the Ministry has launched a comprehensive scheme for modernization of 50 abattoirs across the country. The Ministry of Finance has approved 10 projects at a cost of Rs. 129.00 crores for 2008-09 and the work has started in them. An amount of Rs.600 crores is projected for the next 5 years for modernizing nearly100 Abattoirs.

Cold Chain:
20 cold storages, 3 Value Added Centres, 1 packaging center and 4 irradiation facilities supported in last five years at a cost of Rs.15.59 crore. 10 cold chain are proposed to be set up in 2008-09. Expression of interest received for setting up of 32-50 chains will be funded in next five years.

Human Resource Development:
During last five years, assistance provided to 56 colleges to start courses in Food Technology and Food Science at a cost of Rs.15 crore. In next five years, 54 colleges to be assisted at a cost of Rs.40.00 crores. During last five years 890 EDPs were conducted and 21,384 persons were trained. About 800 EDPs proposed during next five years to train about 21,000 persons to take up self-employment activities and establishing food processing units.

In the last five years, 99 Food Processing Training Centres were established at a cost of Rs.2.63 crores and they trained 9500 persons. In next five years, about 270 such centers to be assisted at a cost of Rs.22.75 crore, expected to train 25000 persons. Research & Development

During last five years, 40 research proposals funded for an amount of Rs.16.68 crores and during next five years an amount of Rs.70 crores would be spent on 140 research proposals.

Expansion of Food Testing Laboratory Infrastructure:
In the last five years, 29 laboratories established at a cost of Rs.39.11 crores. 74 laboratories to be established in next five years at a cost of Rs.84.00 crores.

Quality Year:
The Ministry of Food Processing Industries is observing the year 2008-09 as Food Safety & Quality Year and through various programmes, it has been planned to accelerate the awareness of food safety and quality in the general masses. A National level launch of Food Safety and Quality Year 2008-09 was made on 11th June 2008 in Vigyan Bhawan for food processing industries. Dr. Syeda Hameed, Hon’ble Member Planning Commission was the Chief Guest on the occasion. The concept of food safety and quality is important for all stakeholders starting from the farmers to the processors, to the retailer and to the consumers.

Food Law:
Integrated Food Law i.e. Food Safety & Standards Act was presented in the Parliament and passed in 2006. Food Safety & Standards Authority under the Act has been set up. Now, the implementation of the Law has been transferred to the Ministry of Health.

Setting up/ Technology Upgradation/ modernization/ expansion of FPI units:
During last five years, financial assistance of Rs.348.00 crores was extended to 1610 units and during the next five years 4100 units would be assisted at a cost of Rs.850 crores.

Upgradation of the quality of street food:
During the year 2008-09, the Safe Food Component of the Scheme is being implemented in 9 cities, viz., Kochi, Ludhiana, Agra, Ranchi, Nagpur, Delhi, Guwahati, Jaipur and Panaji. The Food Street Component is being implemented in two cities, viz., Varanasi & Tirupati.

The Safe Food Towns are to be implemented in 50 select cities across the country aimed at various capacity-building initiatives of street food vendors based on their knowledge, attitude and practices towards handling, preparation, storage and presentation at a cost of Rs.178.00 crores.

NIFTEM:
The Cabinet had approved on 21.8.2006 the setting up of National Institute of Food Technology Entrepreneurship and Management (NIFTEM) at Kundli, Sonepat, Haryana at an estimated cost of Rs. 244.6 crore. Hon’ble Chairperson, UPA, had laid foundation stone of the project on 7.10.2007. M/s NBCC has been engaged as Project Management Agency for the project and the work is progressing. In next five years, this Institute would be established as an International Center of Excellence for food processing sector.

IICPT:
Indian Institute of Crop Processing & Technology (IICPT) is an autonomous organisation under Ministry. Main objective – conducting basic, applied research, education and training in the areas of post harvest processing of crops of wet lands, storm & flood prone areas. 13 technologies developed and commercialized – 3 technologies patented in last five years. The Institute have been upgraded into a National level Institute.