Home ECONOMY ‘Food processing industry needs more policy support’

‘Food processing industry needs more policy support’


Reported by Sandeep Pattnaik

Bhubaneswar, Jan 2 :

Food processing (FP) sector which registered an Annual Average Growth Rate (AAGR) of 8.6% in last two years, as compared to the growth rate of 3.6% in agriculture and 7.7% in manufacturing sector,  still has many challenges to deal with, said J P Meena, Joint secretary, Union ministry of Food Processing at the ‘Odisha MSME International trade fair’ on Thursday here.

The FP sector offers tremendous potential for employment generation which has seen a 3.6% CAGR during 2005-06 to 2010-11 and witnessed a FDI inflow to the tune of US 1.8 bn dollar during 2000-13 and 401.5 mn US dollar in the year 2012-13 itself in the country, Meena said.

Photo 2 - Odisha MSME International Trade Fair 2014

But the sector is still battling with several hurdles like infrastructure bottlenecks, leakage in the supply chain management, delayed and multi-layered approval system for setting up of FP units, dysfunctional single window clearance (SWC) mechanism , APMC restrictions in most states on purchase of agri produces etc.

“These factors have discouraged budding entrepreneurs to set up FP units in the country, ” he said.

Besides, delay in getting environmental clearances, land issues, road connectivity, water and power supply including ground water problems haunt the sector, he observed.

“On the other hand, lack of awareness and will-power on the part of entrepreneurs to avail various government subsidies and interest subventions, are major roadblocks in setting up units like mega food parks, cold chains etc,” he added.

“The National Mission on Food Processing (NMFP) has included three new schemes like mega food parks, cold chains, and setting up of abattoirs mostly in PPP mode as part of the policy in the current 12th plan,” Meena informed.

12 new mega food park projects including two in Odisha- one in MITS, Rayagada and another Huma coastal food park in Ganjam -have been approved under the NMFP policy during 12th plan; taking it to a total of 42 such projects in the country. The NMFP has given approval to 30 such projects earlier during the 11th plan period.

Besides, 25 new abattoirs, in addition to modernization of existing ones, were part of the agenda under NMFP. he informed.

As far as the cold storage capacity is concerned, there is a huge gap in cold chain supply in the country against the actual requirement, as assessed by National Spot Exchange Ltd (NSEL) in the year 2010.

The study made in December 2010 has estimated the capacity of cold storage at 23.51 million MT only, as against a requirement of about 61.13 million tonnes-  a gap of about 38 million metric tonnes – in the country.

Inaugurating the seminar the chief secretary Jugal Kishore Mohapatra said, “Social recognition to entrepreneurs are necessary to encourage them to set up industrial units including in the FP sector.”

Mohapatra urged government officials to go the extra-mile for implementing the Odisha Food Policy 2013.

“Besides land, labour and capital, entrepreneurship is a major factor of production and we have to promote entrepreneurship in the state of Odisha in a big way,” the chief secretary said.