The Food Processing Industry in India
At Rs.2,80,000 crores, the food processing industry in India contributes 14% of the GDP. Sectors like fruits and vegetables, dairy, meat, grains, packaged foods & drinks, alcoholic beverages, etc. come under food processing. While the Indian food processing industry is responsible for 9% of the world's fruit production and 11% of vegetable production, every year sees colossal wastage amounting to a damage of Rs.33, 000 crores. Wastage apart; inadequate infrastructure, lack of trained manpower and policies restricting forward and backward linkagesare some other factors affecting growth in this sector.
The Mega Food Park Scheme
It is to overcome these challenges and boost growth in this sector that the Ministry of Food Processing Industries (MoFPI) has announced a Mega Food Park Scheme (MFPS). This Scheme has been designed as part of Ministry's Vision 2015, which aims to increase processing of perishables from 6% to 20%, value addition from 20% to 35% and share in global food trade from 1.5% to 3%. The MFPS aims to provide state-of-the-art infrastructure facilities for food processing along the value chain from 'the farm to market'. As part of the Scheme, the government is offering a 50% subsidy up to Rs.50 crores for project development. The Mega Food Parks will be set up in high potential zones where requisite volumes of raw materials are available and will include creation of basic and support infrastructure near the farm, logistics and Centralized Processing Centres.
Minister of State for Food Processing Industries, Dr. Charan Das Mahant said in a written reply in the Lok Sabha, 'Through backward linkages, Special Purpose Vehicle (SPV) of the Mega Food Park enters into an arrangement with a group of farmers in the catchment area for production of desired variety and quantity of farm produce to ensure regular supply of raw material to the Mega Food Park. This has facilitated clusterised farming in a demand driven manner with market orientation. The farmers are assured of the market for their farm produce and get remunerative prices thereby increasing their income considerably.'Thus the expected outcome is increased realization for farmers, creation of high quality rural processing infrastructure, reduction in wastage, capacity building of the producers and processors and creation of an efficient supply chain along with significant direct and indirect employment generation.
The Scheme will be endorsed by the various state governments with the creation of a flexible and conducive labour environment and special considerationsmay be given like exemption of stamp duty, VAT, sales tax etc. for units located in the MFP. This will facilitate food processing units to meet environmental, safety and international manufacturing standards at a considerably subsidized cost, thus contributing to the sophistication and progress of the industry.
The Food Park will consist of standard factory sheds for Micro and Small Enterprises(MSEs); basic infrastructure like roads, drainage, water supply, electricity supply and support infrastructure such as administrative buildings, training centre, trade centre or display centre, creche, canteen, workers hostel, offices of service providers, labour rest and recreation facilities, etc. Project components include:
Each project will have 30 to 35 food processing units with a collective investment of Rs.250 croreswith an eventual turnover of Rs.450 - 500 crores and creation of direct and indirect employment to the extent of about 30,000. Land requirement for CPC is estimated between 50 to 100 acres. The land required for setting up of PPCs and CCs at various locations would be in addition to land required for setting up of CPCs.
Pattern of Assistance
The pattern of assistance extends to a one-time capital grant of 50% subject to amaximum of Rs.50 crores in general areas and 75% subject to a maximum of Rs.50 crores indifficult and hilly areas i.e. North East region including Sikkim, J&K,Himachal Pradesh, Uttarakhand, and IT DP notified areas of the states. The grant will be released in 4 installments in the ratio of 30: 30: 30: 10. The eligible project cost is defined as total project cost minus cost of land,pre-operative expenses and margin for working capital.
The responsibility of execution, ownership and management of the Mega Food Park would vest with a Special Purpose Vehicle (SPV), a Corporate Body registered under the Companies Act, in which various related stakeholders would be the equity holders.
Ministry Empanelled - Project Management Consultancy
Considering the complexities of the scheme, the Ministry has selected Project Management Consultancies (PMCs) to provide management, capacity building,coordination and monitoring support.MoFPI empanelled Project Management Consultancy;Magus Consulting Pvt. Ltd. aims to assist entrepreneurs in liaisoning withthe Ministry, Developers, Farmers Associations / Self Help Groups creating concept and feasibility reports andin ensuring smooth implementation ofprojects through every stage.
Incorporated in 1954, Magus forayed into providing Project Management Consultancy servicesin 2003with a vision To Create Flourishing Communities. The Group istoday amongst India's leading PMCs,offering conception to completion services under one roof to a diverse set of clientelein Micro Infrastructure, Realty and variousother sectors. It is a trusted partner to several government bodies, corporate institutions and entrepreneurs in a host of innovative projects. Some of the national projects it is associated with are MMRDA's Rental Housing Development, Ministry of Textile's SITP and Bhiwandi Powerloom Cluster and National Centre for Jute Development's Jute Park.
With regard to MFP, Magus can offer its expertise across all stages of project development including in: