Initiatives in Food Processing Sector-Economy(17th March) - Sleepy Classes IAS Skip to main content

Initiatives in Food Processing Sector-Economy(17th March)



Initiatives in Food Processing Sector

Food Processing Industry In India


Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PM FME)

·        PMFME Scheme was launched under the ‘Aatmanirbhar Bharat Abhiyan’ and ‘Vocal for Local’ campaigns, to provide technical, financial and business support to micro food processing units in the country.

·        Under the scheme, One District One Product (ODOP) status for 137 unique products in 710 districts of 35 States/ UTs has been approved by the Ministry.

·        The total funds allocated for this scheme were valued at Rs. 10,000 crores (US$ 1.3 billion) and will be disbursed from 2020 to 2025.

  • The central government has been bearing 100% of all outlays in the first year (2020–21), whether incurred by the centre or the states, and the same outlays will be adjusted in the ratios stated below, in the funds being disbursed to states equally in the next four years.


Components of the PMFME Scheme

  • Support for food processing units
  • Marketing and branding support
  • Support for common infrastructure development
  • Capacity building and research
  • In December 2020, Union Bank of India was appointed as the Nodal Bank and 11 other banks were selected as official lending partners for the PMFME scheme.
  • NAFED and TRIFED are the two organisations assigned to take up marketing & branding support.
  • In September 2021, MOFPI, under the PMFME scheme virtually launched Seed Capital Module on the Deendayal Antyodaya Yojana-National Urban Livelihoods Mission (DAY-NULM) MIS Portal. 
  • This portal gives access to urban SHGs working in the micro food processing sector, to avail the seed capital assistance of Rs. 40,000 (US$ 540), per SHGs member, under the PMFME scheme.

Pradhan Mantri Kisan SAMPADA Yojana

Under the umbrella central sector scheme PMKSY, the Ministry is implementing various component schemes, inter-alia, including 

  • 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, 
  • Operation Greens and 
  • Food Testing Laboratories
  • Under PMKSY, capital subsidy in the form of grants-in-aid ranging from 35% to 75% of the eligible project cost subject to maximum specified limit is provided to investors under the various schemes for undertaking infrastructure, logistic projects and setting up of food processing units in the country.


TOP Scheme

·        Operation Greens Scheme was announced in the Union Budget for 2018-19 to promote Farmer Producer Organisations (FPOs), agri-logistics, processing facilities and professional management for Tomato, Onion and Potato (TOP) crops.


The scheme will have two-pronged strategy of Price stabilisation measures (for short term) and Integrated value chain development projects (for long term).

  • Short term Price Stabilisation Measures
    • NAFED will be the Nodal Agency to implement price stabilisation measures. MoFPI will provide 50% of the subsidy on the following two components:
      • Transportation of Tomato Onion Potato(TOP) Crops from production to storage;
      • Hiring of appropriate storage facilities for TOP Crops;
  • Long Term Integrated value chain development projects
  • Formation and Capacity Building of FPOs
  • Quality Production
  • Post-harvest processing facilities – At Farm Level
  • Post-harvest processing facilities – At Main Processing Site
  • Agri-Logistics
  • Marketing/Consumption Points



Market Intelligence and Early Warning System

  • MIEWS Dashboard and Portal is a platform for monitoring prices of tomato, onion and potato (TOP) and for generating alerts for intervention under the terms of the Operation Greens scheme. 
  • The portal would disseminate all relevant information related to TOP crops such as Prices and Arrivals, Area, Yield and Production, Imports and Exports, Crop Calendars, Crop Agronomy, etc in an easy to use visual format.

Pattern of Assistance

  • For Price Stabilisation Measures
    • 50% of cost of transportation and 50% of cost of hiring appropriate storage facilities will be provided as subsidy at the time of harvest. Storage facilities will be hired for a maximum period of 4 to 6 months. 
    • NAFED will be nodal agency for disbursement of subsidy under this component to the eligible organization.
  • For Integrated value chain development projects
    • The Post-harvest processing facilities including secondary processing facilities will be mandatory components of the Integrated value chain development project. 
    • The projects will be eligible for grant-in-aid at the rate of 50% of the eligible project cost in all areas, subject to maximum Rs. 50 crore per project. 
    • However, in case where PIA is/are FPO(s), the grant-in-aid will be at the rate of 70% of the eligible project cost in all areas, subject to maximum Rs. 50 crore per project.

Operation Greens (TOP to TOTAL)

  • Ministry of Food Processing Industries (MoFPI) has recently extended the Operation Greens Scheme from Tomato, Onion and Potato (TOP) to all fruits & vegetables (TOTAL) for a period of six months on pilot basis as part of Aatmanirbhar Bharat Abhiyan.
  • The objective of intervention is to protect the growers of fruits and vegetables from making distress sale due to lockdown and reduce the post -harvest losses.
  • Eligible Crops:- Fruits- Mango, Banana, Guava, Kiwi, Lichi, Papaya, Citrus, Pineapple, Pomegranate, Jackfruit; Vegetables: – French beans, Bitter Gourd, Brinjal, Capsicum, Carrot, Cauliflower, Chillies (Green), Okra, Onion, Potato and Tomato. 
  • Any other fruit/vegetable can be added in future on the basis of recommendation by Ministry of Agriculture or State Government.

FDI in Food Processing Sector

  • In FPI, 100 per cent FDI is permitted under the automatic route. 
  • However, in case of trading in respect of food products manufactured and/or produced in India including through e-commerce, 100 per cent FDI is allowed under the Government approval route.