Introduction
The food processing industry in India is one of the largest employers within the organized manufacturing sector. According to the Economy Survey 2024-2025, it accounts for 12.41 percent of total employment in the organized sector. In the fiscal year FY24, agri-food exports, including processed food exports, reached USD 46.44 billion. It constitutes roughly 11.7 percent of India’s total exports.
Evaluating the Food Processing Industry: A Critical Sector in the Indian Economy
Rise in Exports in FY24
According to the Economy Survey 2024-2025, the share of processed food exports within agri-food exports has risen from 14.9 percent in FY18 to 23.4 percent in FY24.
Government Schemes
The government has launched several schemes to foster growth in the food processing sector under one Umbrella Scheme called the Pradhan Mantri Kisan Sampada Yojana (PMKSY).
Pradhan Mantri Kisan SAMPADA Yojana (PMKSY)
SAMPADA stands for Scheme for Agro-marine Processing and Development of Agro-processing Clusters. It was renamed as ‘Pradhan Mantri Kisan SAMPADA Yojana (PMKSY)’. PM Kisan SAMPADA Yojana is a comprehensive package that aims to create modern infrastructure with efficient supply chain management from farm gate to retail outlet.
Umbrella Scheme
The PMKSY had seven component schemes viz; These are
- Mega Food Parks
- Integrated Cold Chain and Value Addition Infrastructure,
- Infrastructure for Agro-Processing Clusters,
- Creation of Backward and Forward Linkages,
- Creation/Expansion of Food Processing & Preservation Capacities,
- Food Safety and Quality Assurance Infrastructure and
- Human Resources and Institutions.
Development of New Infrastructure
This scheme focuses on developing modern infrastructure and optimizing supply chains from farm to retail. The scheme aims to minimize post-harvest losses, increase processing capabilities, and enhance export levels. It aims to promote the overall advancement of the food processing industry. According to the economy survey 2024-25, as of 31 October 2024, 1,079 PMKSY projects have been completed.
Production Linked Incentive Scheme for Food Processing (PLISFPI)
The Production Linked Incentive Scheme for Food Processing (PLISFPI) was launched in 2021. It seeks to cultivate globally competitive food processing leaders by facilitating branding and marketing initiatives in international markets. According to the Economic Survey, by 31 October 2024, 171 applications got approval under this scheme by the government. The beneficiaries had invested ₹8,910 crore and received ₹1,084.01 crore in incentives.
Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME)
The government launched this scheme to provide comprehensive support including technical, financial, and business assistance for establishing or upgrading micro food processing enterprises. The scheme was launched in 2020. According to the Economic Survey, as of 31 October 2024, the scheme received 407,819 applications, with loans totaling ₹8.63 thousand crores sanctioned to 108,580 applicants. Further, the program has successfully trained 672 Master Trainers, 1,120 District Level Trainers, and 87,477 beneficiaries across 36 states and union territories.
Food Storage
The government has also expressed developments in food storage in the economy survey. It has provided details of all innovative actions taken in this field.
Steel Silos
The government upgraded the storage infrastructure for foodgrains and to ramped up the storage capacity in India by creating steel silos under PPP Model.
Hub and Spoke Model Silos
The government is also creating capacity under Hub and Spoke Model Silos, where “Hub” silos have a dedicated railway siding and container depot facility. While the transportation from “Spoke” Silos to “Hub” Silos is undertaken by road, transportation from Hub to Hub is via rail.
Flospan
The government has come up with an innovative idea to improve food grain storage, especially in hilly and remote areas. The government is exploring the use of Flospan, a type of Mobile Storage Unit (MSU), in collaboration with the World Food Programme (WFP). These units can be quickly erected and have a storage capacity of 400 metric tonnes. As a pilot project, WFP has installed Flospan in six states: Jammu & Kashmir, Himachal Pradesh, Rajasthan, Mizoram, Uttarakhand, and Chhattisgarh.
Warehouse Modernization
The government partnered with WFP and the Indian Grain Storage Management & Research Institute (IGMRI) to modernize government grain warehouses. The collaboration will launch a ‘Smart Warehouse’ as a pilot project. This warehouse uses sensors to monitor temperature, humidity, airflow, and rodent activity, providing real-time data to improve storage and reduce losses.
Conclusion: Showcasing Achievements in Food Processing And Food Storage
India’s food processing sector, despite encountering various challenges, remains a crucial pillar for economic growth and ensuring food security for the nation. The government has showcased its achievements in food processing with an indication to the industry fellows that it welcomes modernization and expansion in this domain. Further. it has also supported the food processing industry by providing Production Linked Incentive schemes and PPP Models in improving storage.