FOOD PROCESSING INDUSTRY

INTRODUCTION
Food processing is the transformation of raw ingredients, by physical or chemical means into food, or
of food into other forms. Food processing combines raw food ingredients to produce ready- to –eat and
marketable food products that can be easily prepared and served by the consumer.The term 'food
processing' is mainly defined as a process of value addition to the agricultural or horticultural produce
by various methods like grading, sorting and packaging. In other words, it is a technique of
manufacturing and preserving food substances in an effective manner with a view to enhance their shelf
life; improve quality as well as make them functionally more useful, reduce post-harvest wastages. It
covers spectrum of products from sub-sectors comprising agriculture, horticulture, plantation, animal
husbandry and fisheries.
According to Food and Agriculture Organization (FAO), processed foods can be classified into three types
viz. Primary, Secondary and Tertiary.
1. The Primary processing includes basic cleaning, grading and packaging as in case of fruits and
vegetables.
2. Secondary processing includes alteration of the basic product to a stage just before the final
preparation as in case of milling of paddy to rice.
3. Tertiary processing leads to a high value-added ready-to eat food like bakery products, instant
foods, health drinks, etc.

FOOD PROCESSING INDUSTRY IN INDIA

Earlier, food processing was largely confined to the food preservation, packaging and
transportation, which mainly involved salting, curdling, drying, pickling, etc. However, over the years,
with emerging new markets and technologies, the sector has widened its scope. It has started producing
many new items like ready-to-eat food, beverages, processed and frozen fruit and vegetable products,

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marine and meat products, etc. It also include establishment of post-harvest infrastructure for
processing of various food items like cold storage facilities, food parks, packaging centres, value added
centres, irradiation facilities and modernised abattoir.
The Indian food and grocery market is the world’s sixth largest, with retail contributing 70 per
cent of the sales. The Indian food processing industry accounts for 32 per cent of the country’s total
food market, one of the largest industries in India and is ranked fifth in terms of production,
consumption, export and expected growth. It contributes around 8.80 and 8.39 per cent of Gross Value
Added (GVA) in Manufacturing and Agriculture respectively, 13 per cent of India’s exports and six per
cent of total industrial investment. The Indian food market is currently valued at US$ 1.3 billion and is
growing at a Compound Annual Growth Rate (CAGR) of 20 per cent. India's organic food market is
expected to increase by three times by 2020.The online food ordering business in India is in its nascent
stage, but witnessing exponential growth. With online food delivery players like FoodPanda, Zomato,
TinyOwl and Swiggy building scale through partnerships, the organised food business has a huge
potential and a promising future. The online food delivery industry grew at 150 per cent year-on-year
with an estimated Gross Merchandise Value (GMV) of US$ 300 million in 2016.
According to the data provided by the Department of Industrial Policies and Promotion (DIPP),
the food processing sector in India has received around US$ 7.54 billion worth of Foreign Direct
Investment (FDI) during the period April 2000-March 2017. The Confederation of Indian Industry (CII)
estimates that the food processing sectors have the potential to attract as much as US$ 33 billion of
investment over the next 10 years and also to generate employment of nine million person-days.
Nascent Food Processing Industry
Despite the agrarian strength of production in India, its diverse agro climatic zones conducive to
produce diverse fruits and vegetables , food processing industries in India is still at nascent stage, but
holds tremendous potential to grow, considering the wide and large raw material base, along with a
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huge market base in India itself.

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Even though India’s agricultural production base is reasonably strong, it has high levels of
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wastages of over 35 percent. And in the current economic scenario with huge agrarian crisis, poor
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agricultural productivity and poor returns, Food Processing Industries can help in diversifying farm
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income, thus reducing this agrarian stress. In comparison to other emerging economies like Brazil (70%),
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Thailand (40%), Philippines(78%) and Malaysia (80%) , India’s value addition in agricultural produce is
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merely around 20%.

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Another major issue is that food processing is mainly dominated by unorganized sector (90%
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share), which thus keeps majority of producers away from the ambit of government regulations and
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benefits.

GROWTH DRIVERS/POTENTIAL
The liberalisation of the Indian economy and world trade as well as rising consumer prosperity has
thrown up new opportunities for diversification in the food processing sector and opened up new
avenues for growth. Demand for processed and convenience food is increasing constantly because of
urbanisation, changing life-style and food habits of the people. Accordingly, the Indian consumers are
being offered newer high quality food products made by using the latest state-of-the-art technology.
 A population of 1.2 Billion people, with the world’s highest youth population – India has 572
Million people under the age of 24.
 Rising income levels and a growing middle class.
 One-third of the population will be living in urban areas by 2020.
 Increasing desire for branded food as well as increased spending power.
 Large and distinct consumer brackets to support customized offerings, new categories and
brands within each segment.

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  Consumption in India is driven towards packaged and ready-to-eat foods.
 Favourable economic and cultural transformation and a shift in attitudes and lifestyles have
consumers experimenting with different cuisine, tastes and new brands. There is an awareness
and concern for wellness and health, for high protein, low-fat, wholegrain, organic food.
 Processed food exports and related products have been rising steadily, the main destinations
being the Middle East and Southeast Asia.
 Liberalization and the growth of organized retail have made the Indian market more attractive
for global players. With a large agricultural sector, abundant livestock and cost competitiveness,
India is fast emerging as a sourcing hub of processed food.

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Location of food processing industries in India:

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India has more than 35000 registered units. But majorities of the food processing factories are
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concentrated in the coastal states (one reason being, accessibility to marine food processing)
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Major coastal states includes: Andhra, Maharashtra, Karnataka, Kerala, Gujarat, Punjab and WB. Non-
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coastal states include UP, Punjab etc.

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SUPPLY CHAIN MANAGEMENT

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 Supply chain management (SCM) is the management of the flow of goods. It includes the
movement and storage of raw materials, inventory and finished goods from point of origin to point of
consumption. Let’s analyse the case of Supply Chain Management for Food Processing Industry. Raw
materials like grains, raw meat, fish etc are collected by different sources. These sources may do
preliminary processing of these to make components of a food product before passing over them to the
main manufacturer through many middlemen. The manufacturer does the final processing of these
components to make the food product. This completes only the first stage of supply management.
Now the finished product has to be delivered to the consumer. Here also there will be a number of
middle men and stages. The manufacturer normally hands over the food product to a whole sale dealer.
The wholesaler pass the product to a retailer from where the consumer buys the processed food item
for his personal use.

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Thus, Supply Chain Management is the management of upstream and downstream value added flow of
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materials from suppliers→ company→ retailer→ final consumers.

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Importance of Supply Chain Management in Food Processing Industry

If there are good Supply Chain Management practices in a country, then it will boost economy as a
whole. Good supply chain links helps farmers, manufactures, wholesalers, retailers and consumers.
Everyone in the supply chain link will get inputs at a faster rate, at the right time and at a cheaper cost.

UPSTREAM AND DOWNSTREAM STAGES

1. Upstream stage: The upstream stage of the production process involves searching for and extracting
raw materials. The upstream part of the production process does not do anything with the material
itself, such as processing the material. This part of the process simply finds and extracts the raw
material. Thus, any industry that relies on the extraction of raw materials commonly has an upstream
stage in its production process.
2. Downstream stage: The downstream stage in the production process involves processing the
materials collected during the upstream stage into a finished product. The downstream stage further

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includes the actual sale of that product to other businesses, governments or private individuals.
Downstream process has direct contact with customers through the finished product.
Upstream requirements: Downstream requirements
-Accessibility to raw materials. -Latest processing techniques.
-Modern extraction techniques. -Latest processing machinery.
-Good linkages with farmers. -Quality testing facilities.
-Storage facilities for raw materials like Grains, -Organized retail stores for faster distribution.
Meat, etc. -Work force.
-Quality testing facilities.
-Transport facilities.
-Work force.

OBSTACLES IN THE GROWTH OF FOOD PROCESSING INDUSTRIES

• Infrastructure is the backbone of food processing industry. We have seen that India is biggest
producer of numerous fruits and vegetable. Most of these are perishable and have very low shelf life.
This is the major reason for high percentage of wastage. Their shelf life can be increased by adequate
investment in infrastructure such as cold storage, reefer vans, radiation plants etc. Storage of food
grains is a big issue. Food Corporation of India deals only in food grains and about 67 per cent of the
storage capacity is concentrated in the six major procuring states namely, Punjab, Haryana, Uttar
Pradesh, Andhra Pradesh, Rajasthan and Uttrakhand. Several States have emerged in recent years as
important states for food grains procurement, namely, Bihar, Odisha, Jharkhand, West Bengal, Madhya
Pradesh and Chhattisgarh presently account for 13 per cent of the current storage capacity. Indian
national highways account for only 2% of the total road network but carry 40% of all cargo. This puts a
high pressure on the highways due to the high traffic volumes which results in delays in transit and
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damage to perishable products. Though highways are well-spread, they’re yet to connect all 550,000+
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villages in India
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• Most of Indian food processing units/companies/enterprises/factories are small sized which results
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in poor economies of scale and thus hinder the research and development investment or marketing
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potential etc.
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• The number of laboratories in the country is insufficient. Most of these laboratories lack world-class
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facilities and infrastructure. Equipment, Testing manuals etc are outdated. Many laboratories are not
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equipped with basic facilities such as for testing antibiotic residues, heavy metal contamination and
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other toxic contaminants in the food items.Most laboratories at sea ports are not fully equipped to
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handle testing of imported products, organic foods, residual radioactive matter, new toxins and
allergens, textural analysis, residues of veterinary drugs, enzymes and hormones etc. These tests are
necessary for complying with Codex, sanitary and phytosanitary norms of WTOetc before exporting to in
US/EU markets.
• Lack of skilled man power is another issue. As per a study by National Skill Development Corporation
the annual human resource requirement in food processing industry is estimated at about 5 lakh
persons including about one lakh persons in the organized sector. But right now, every year, barely 5000
graduates and postgraduates pass out from in different disciplines of Food science and technology. Very
few universities offer graduation/PG courses, entrepreneurship courses for food science and
technology. Syllabus/courses in university departments are not being updated regularly and are in most
cases, outdated with respect to the present trends and food industry requirement. The teaching faculty
in most of the Indian academic institutions studied has limited industry experience / exposure.
• Lack of R&D is another major issue. Indian food processing industry is mainly made up of small scale
players and dominated by unorganized sectors. They can’t invest money in R&D and thus it becomes
government’s responsibility to do the R&D which is highly inadequate. Multinational Food companies

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typically have an in-house global network of R&D professionals. Although they’re willing to work with
Indian institutions for developing India-specific products and processes. But the quality of R&D currently
undertaken by existing Indian institutions is not in line with their requirements.
• Lack of organised retail is another challenge. In USA there are two types of retailers i.e, Big malls like
Walmart etc. and small stores. But both of them have cold-storage facilities, hence they sell both dry
and wet/fresh food products. But in India, kirana stores don’t have cold storage facilities and so they
only sell dry food products. Fresh products like green vegetables have a special demand in India and
small vendors are more preferred over the malls.
• Lack of comprehensive national level policy on food processing. They remain to be governed by
various statutes. there is an urgent need of food processing policy which includes incentives like tax
breaks.
• Access to credit is another challenge. Setting up of the food processing units is capital intensive due to
huge initial capital cost requirements. Therefore in order to assist this burgeoning industry to realize its
potential, Government of India has declared the financing of food processing sector as a priority sector.
However, the processing industry is not complacent with the way the scheme is being implemented and
procedural hurdles that are involved in realizing loans/subsidy from financial institutions and supporting
agencies like APEDA, NHB and other state government promotional agencies. FICCI survey has revealed
that inadequate access to credit is also a major issue of concern for the industry.

GOVERNMENT POLICY INITIATIVES

1. MEGA FOOD PARKS
Mega Food Parks Scheme (MFPS) was launched in 2008 whereby, the Government provides
Financial Assistance up to Rs. 50 Crore to set up modern infrastructure facilities for food processing
called Mega Food Parks. The key objective of MFPs is to provide adequate / excellent infrastructure
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facilities for food processing along with value chain from farm to market. It includes creation of
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infrastructure near the farm, transportation, logistics and centralized processing centres.
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The Scheme of Mega Food Park aims at providing a mechanism to link agricultural production to
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the market by bringing together farmers, processors and retailers so as to ensure maximizing value
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addition, minimizing wastage, increasing farmers income and creating employment opportunities
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particularly in rural sector. The Mega Food Park Scheme is based on “Cluster” approach and envisages
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creation of state of art support infrastructure in a well-defined agri / horticultural zone for setting up of
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modern food processing units in the industrial plots provided in the park with well-established supply
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chain. Mega food park typically consist of supply chain infrastructure including collection centers,
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primary processing centers, central processing centers, cold chain and around 25-30 fully developed
plots for entrepreneurs to set up food processing units. The Mega Food Park project is implemented by
a Special Purpose Vehicle (SPV), which is a Body Corporate, registered under the Companies Act.

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2. SCHEME FOR CREATING BACKWARD AND FORWARD LINKAGES
The objective of the scheme is to provide effective and seamless backward and forward integration for
processed food industry by plugging the gaps in supply chain in terms of availability of raw material and
linkages with the market. Under the scheme, financial assistance is provided for setting up of primary
processing centers/ collection centers at farm gate and modern retail outlets at the front end along with
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connectivity through insulated/ refrigerated transport.

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3. CREATION/EXPANSION OF FOOD PROCESSING/PRESERVATION CAPACITIES SCHEME (CEFPPC)

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The main objective of the Scheme is creation of processing and preservation capacities and
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modernisation/ expansion of existing food processing units with a view to increasing the level of
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processing, value addition leading to reduction of wastage. The processing activities undertaken by the
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individual units covers a wide range of post-harvest processes resulting in value addition and/or
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enhancing shelf life with specialized facilities required for preservation of perishables.
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4. PRADHAN MANTRI KISAN SAMPADA YOJANA

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi,
has approved the renaming of the new Central Sector Scheme - SAMPADA (Scheme for Agro-Marine
Processing and Development of Agro-Processing Clusters) as "Pradhan Mantri Kisan Sampada Yojana
(PMKSY) " for the period of 2016-20 coterminous with the 14th Finance Commission cycle. Earlier, CCEA
in its meeting held in May, 2017 approved the new Central Sector Scheme - SAMPADA (Scheme for
Agro-Marine Processing and Development of Agro-Processing Clusters) with same allocation and
period.
Objective: The objective of PMKSY is to supplement agriculture, modernize processing and decrease
Agri-Waste.
Background: PMKSY is an umbrella scheme incorporating ongoing schemes of the Ministry. The
following schemes will be implemented under PM Kisan SAMPADA Yojana :
1. Mega Food Parks
2. Integrated Cold Chain and Value Addition Infrastructure

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 3. Creation/ Expansion of Food Processing/ Preservation Capacities (Unit Scheme)
4. Infrastructure for Agro-processing Clusters
5. Creation of Backward and Forward Linkages
6. Food Safety and Quality Assurance Infrastructure
7. Human Resources and Institutions
Impact:
• The implementation of PMKSY will result in creation of modern infrastructure with efficient supply
chain management from farm gate to retail outlet.
• It will provide a big boost to the growth of food processing sector in the country.
• It will help in providing better prices to farmers and is a big step towards doubling of farmers’ income.
• It will create huge employment opportunities especially in the rural areas.
• It will also help in reducing wastage of agricultural produce, increasing the processing level, availability
of safe and convenient processed foods at affordable price to consumers and enhancing the export of
the processed foods.

5. AGRI EXPORT ZONES (AEZ)

With the primary objective of boosting agricultural exports from India, in March 2001, Government of
India announced a policy of setting up of Agri Export Zones (AEZs) across the country. Agricultural &
Processed Food Products Export Development Authority (APEDA) is the designated nodal agency for
AEZ. At present, APEDA has set up 60 Agri-Export Zones (AEZs) spread over 230 districts in 20 states. The
crops covered include fruits, vegetables, spices, cashew, tea, basmati rice, medicinal plants, pulses etc.
In all, 35 crops were identified for promotion in these zones. The total investment committed under the
AEZ programme by all agencies stands at Rs.1, 724 crore, including private investments of Rs.970 crore.
Objectives
The objective of setting up AEZs is to converge the efforts made, hitherto, by various central and
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state government departments for increasing exports of agricultural commodities from India. The AEZ
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takes a comprehensive view of a particular produce/ product located in a geographically contiguous

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area for the purpose of developing and sourcing raw materials, their processing/packaging, and leading
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to final exports.
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 Cluster approach of identifying the potential products and geographical region in which these
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products are grown.

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 Adopting an end-to-end approach of integrating the entire process, right from the stage of
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production till it reaches the consumption stage.

 Integration of the activities of various agencies connected with the department of the product.
The emphasis in all the Agri Export Zones is on convergence. Thus, the objective is to utilize the
ongoing schemes of various Central and State Government Agencies in a co-ordinate manner to cover
the entire value chain from farm to the consumer. In all the projects, necessary commitments have been
given by the State Governments and the Central Government Agencies have also agreed to the project
in principle. Detailed scheduling of each action point has been worked out.
The anticipated benefit to accrue as a consequence of setting up of such zones are as follows:
-Strengthening of backward linkages with a market oriented approach
-Product acceptability and its competitiveness abroad as well as in the domestic market
-Value addition to basic agricultural produce
-Bring down cost of production through economy of scale
-Better price for agricultural produce
-Improvement in product quality and packaging
-Promote trade-related research and development

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-Increase employment opportunities.

6. MODERNIZATION OF ABATTOIRS
The Ministry of Food Processing Industries (MOFPI) has launched the scheme of Setting up of New/
Modernization of existing Abattoirs with a view to ensure scientific,hygienic slaughtering of the animals
and supply of quality meat and meat products.

7. OPERATION GREENS
In the budget speech of Union Budget 2018-19, a new Scheme “Operation Greens” was announced on
the line of “Operation Flood”, with an outlay of Rs.500 crore to promote Farmer Producers
Organizations (FPOs), Agri-logistics, processing facilities and professional management. Accordingly, the
Ministry has formulated a scheme for integrated development of Tomato, Onion and Potato (TOP) value
chain.
Objectives:
i. Enhancing value realization of TOP farmers by targeted interventions to strengthen TOP
production clusters and their FPOs, and linking/connecting them with the market.
ii. Price stabilization for producers and consumers by proper production planning in the TOP
clusters and introduction of dual use varieties.
iii. Reduction in post-harvest losses by creation of farm gate infrastructure, development of
suitable agro-logistics, creation of appropriate storage capacity linking consumption centres.
iv. Increase in food processing capacities and value addition in TOP value chain with firm
linkages with production clusters.
v. Setting up of a market intelligence network to collect and collate real time data on demand
and supply and price of TOP crops.
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The scheme will have two-pronged strategy of Price stabilization measures (for short term) and
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Integrated value chain development projects (for long term).

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8. RECENT POLICY INITIATIVES

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In order to provide impetus to the Food Processing Industries, the government has taken the following
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initiatives:
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 100% FDI: 100% FDI is permitted in the automatic route for most food products except for items
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reserved for micro and small enterprises.

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 Decentralisation of the implementation of schemes : Decentralisation of the implementation of

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schemes with active participation of State Governments;

 APMC Reforms: Identifying APMC issues affecting food processing for appropriate amendments
in APMC Act.
 Infrastructure Development: Enhancing allocation of Infrastructure Development schemes: 42
Mega Food Parks, 138 coldchain projects, 60 abattoirs
 Coordination: Regular interaction with industry and State Governments for activating single
window clearance
 Simplification of Application Forms: Application Forms of all the Schemes currently being
implemented by Ministry of Food Processing Industries has been simplified. Requirement of
supporting documents such as affidavit, agreements etc earlier required to be submitted with
the proposal reduced.
 Sectoral Skill Council: Sectoral Skill Council on Food Processing working in Federation of Indian
Chamber of Commerce and Industry (FICCI)
Initiatives in the Financial Year 2014-15

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  Launching of Investors Portal: Information on potential and opportunities for investment in the
food processing sector and incentives provided by the Central and State Governments were
made available to the prospective investors at a single point. The queries of the investors were
received and answered through the portal guiding them and making it easier for them to take
decision.
 Special Fund in NABARD: Availability of affordable credit to Mega Food Parks and food
processing units set up therein Rs. 465 crore sanctioned to 12 number of Projects and Rs. 91
crore disbursed.
 Food Map of India: The Food Map enables investor to take decision with regard to locating their
projects as the food map showed mapping of the potential of food processing in surplus
production areas.

Initiatives in the Financial Year 2015-16

 Priority Sector Lending: Food and agro-based processing unit and cold chain infrastructure have
been classified under agriculture activities for Priority Sector Lending.
 Service Tax Exemptions: Service Tax on pre-conditioning, pre-coding, ripening, waxing, retail
packaging and labelling of fruits and vegetables exempted in cold chain projects

Initiatives in the Financial Year 2016-17

 Permitting 100% FDI: Permitting 100% FDI in retail trade including E-Commerce of food
products manufactured and or produced in India. This has enhanced investment opportunities
in India globally and have generated interest among the leading world food retailers for making
investment in India
 Launched Investors Portal: Information on potential and opportunities for investment in the
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food processing sector and incentives provided by the Central and State Governments were
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made available to the prospective investors at a single point.

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 Food Map of India: The Food Map enables investor to take decision with regard to locating their
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projects as the food map showed mapping of the potential of food processing in surplus
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production areas
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 Excise Duty on Machinery reduced from 10% to 6%: The reduction of duty resulted in reduction
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in cost of investment in the food processing projects and enhancing viability of the projects
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 SAMPADA Scheme: The SAMPADA Scheme will target creation of Infrastructure and increasing
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capacities of processing and preservation in entire supply chain of food processing sector right
from farm gate to retail outlets.

Initiatives in the Financial Year 2017-18

 e-NAM to be expanded from 250 to 585 APMCs:This will encourage and make easier direct
procuring of raw-material by the processing units and retail traders resulting in increased
income to farmers.
 Model Law on Contract Farming:The Contract Farming Law will integrate backward integration
of the food processors with the farmers and attracting investment in post harvest management
activities leading to increased benefit to the farmers and reduction in wastages.
 A Dairy Processing and Development Fund of Rs. 8000 core to be set up in NABARD: The Fund
will be used to modernize old and obsolete milk processing units particularly in cooperative
sector and will result in enhancing milk processing capacity thereby adding more value to the
produce of the farmers and increasing their income

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National Policy on Food Processing: The policy will provide a road map for holistic development for the
food processing sector, the potential and opportunities for the growth of supply chain and promote
food processing in the country to create employment opportunities and ensure wellness of the farmers.
Initiatives in the Financial Year 2018-19
 Fisheries And Aquaculture Infrastructure Development Fund (FAIDF): The nodal agencies for
the fund will be NABARD, National Cooperatives Development Corporation and other scheduled
banks. The fund will be available for both marine and inland fisheries, will boost fish production
and help achieve targets of 15 million tones by 2020 under Blue Revolution.
Initiatives in the Financial Year 2019-20
 Interest Subvention: 2% interest subvention for farmers engaged in animal husbandry and
fisheries who take loans through the Kisan Credit Card (KCC) scheme. Further, in case of timely
repayment of loans, the borrowers will get an additional 3% interest subvention.

WAY OUT
Address Infrastructure bottlenecks to give further impetus to the sector. Dedicated freight
corridors in rail supplemented by concretized dual carriageways for the State & National highways, will
directly reduce the cost of goods supplied. Support to private rail operators by providing access to
infrastructure of Indian railways at concessional rates; tax holidays for purchase of wagons and creation
of infrastructure, especially that of rail terminals for cargo consolidation and aggregation. Incentives for
setting up warehousing/cold storage infrastructure and customized transportation network
development.
There is a need to develop a single entity of all multi-modal transportation, instead of splitting
into rail, surface and air as separate Ministries & entities. This entity needs to remain customer &
industry centric rather than as the Governmental control mechanism.
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Provide further incentives to FTWZs, one of the major drivers of warehousing business.
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FTWZ (Free Trade and Warehousing Zones) is a policy of the Government of India. It was announced in
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the Foreign Trade Policy 2004-09 to set up Free Trade and Warehousing Zones to create trade related
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infrastructure to facilitate the import and export of goods and services with freedom to carry out trade
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transactions in free currency.

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Formulation of Comprehensive National Level policy on Food Processing. The comprehensive

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policy will ensure private sector investment in infrastructure development, increased farm productivity
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and up gradation of quality and give further impetus to the food processing sector. The comprehensive
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national level food processing policy would also ensure institutional strengthening , capacity building
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across the value chain and would also seek to promote innovation in general and technological
innovation in particular.
Inter Ministerial Working Group to Address the Issues. The Government should set up Inter
Ministerial Working Group (IMWG) under the leadership of Ministry of Food Processing to look at
comprehensively addressing various issues that are holding this sector back.
Undertake appropriate measures to address the skill Gap Issue in the sector. The government
should allocate separate budget for human resource development for food processing sector for
enhancing and up gradation of the skills and implementation of the various schemes for skill
development. All the skills development cells and other organizations and ministries should work in
tandem for effective implementation of the objectives set. There is a need for immediate adoption of
ITI’s by the food processing industry in various clusters across the country to upgrade the lower end
skills. The candidates after training could be directly employed by the industry; this model is already
prevalent in some parts of the country at a small scale, but now it needs a big push from the industry.

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Food processing Industry should partner with few food technology/processing institutes on a pilot basis
for up gradation of higher end skills, and the same could be replicated for more and more institutions.
Implementation of Food Safety and Standards Act (FSS Act): Government should ensure the
enforcement of the Food Safety and Standards Act in spirit including increasing radically the number of
trained inspectors and state of the art lab facilities.
Implementation of all the provisions of Model Act across all States/UTs: One of the major issues
holding the sector back is the non implementation of all the provisions of the Model Act across all the
States/UT’s. The Government should ensure speedy implementation of all the provisions of the act.
Credit Access to Food Processing Industries: The Government should establish a National bank,
on the lines of NABARD, to lend credit to food processing industries. This will ensure speedy disbursals
of the funds to food processing sector, always grappling, with the issue of lack of access to credit from
banks. Also, the state governments should play a catalytic role in partnership with banks, financial
institutions and technical and management institutions so that small and unorganized players become
globally competitive.

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