The Cabinet on Wednesday approved a production-linked incentive scheme for the food processing sector with an outlay of ₹10,900 crore, in a bid to create global manufacturing champions in the country. The scheme will be implemented over a six year period from 2021-22 to 2026-27.
This scheme aims to incentivize manufacturing of ready-to-cook and ready-to-eat food products, products made of processed fruits and vegetables, marine products and mozzarella cheese. Innovative or organic products of small and medium sized enterprises including egg, poultry meat, egg products will also be incentivized.
In addition, a component of the scheme will also focus on offering subsidies for in-store branding, shelf-space renting and marketing, to promote Indian brands in global markets.
Union Minister Piyush Goyal said that the implementation of the scheme will help expansion of processing capacity to generate processed food output of ₹33,494 crore and create about 2.5 lakh jobs by 2026-27. He said this will also increase the share of the processed food sector in India’s exports.
Goyal said that this will ensure remunerative prices for farm produce and higher income for farmers and strengthen global visibility of Indian brands in international markets
An expression of interest will be floated by April-end and interested companies will need to commit to a minimum level of investments and increase in sales and if they achieve both they will be able to avail subsidies based on the incremental sales.
“The selected applicant will be required to undertake investment, as quoted in their application (subject to the prescribed minimum) in Plant & Machinery in the first two years of 2021-22 & 2022-23. Investment made in 2020-21 also to be counted for meeting the mandated investment,” an official statement added. Conditions of stipulated minimum sales and mandated investment will not be applicable for entities selected for making innovative or organic products, it noted.