Boost to food processing

Business Standard 10th July 2020 Save

Context: The government has announced a new scheme to provide boost to food processing which will serve multiple purpose, however fiscal constraints remains as a roadblock in implementation.

Features of the Scheme

Rejuvenating food processing industry:

- - Ensuring stable processed food market: India being the world’s second largest producer of fruits and vegetables still suffers from price and supply fluctuations.

Prolonging the usable life of the spoilage-prone foods,
Small agro-processors can make seasonal farm produce available round the year,
Reducing price volatility

Generate employment and income in rural areas: target is to create about 900,000 skilled and semi-skilled jobs
Investments: Though the government has allocated Rs 10,000 crore for this scheme, it is expected to garner an investment of Rs 35,000 crore in micro agro- processing sector.
Cut down post-harvest wastage.

Small scale processing units preferred : As they have displayed resilience during the Covid-19 crisis by sustaining production and supplies regardless of worker shortage.

- - These units can help meet demand of ready-to-eat variants of local foods.
  - Provision of capital linked subsidy along with access to information, technology, training, common infrastructure and a wider market.

One district, one Product approach: Districts and their adjoining areas are framed for their special and exclusive products which can be processed, branded and marketed.

- - Processing units are located nearby raw material reducing their total costs and problems in procuring.

Comprehensive coverage: It proposes to cover all products of agriculture and its allied sectors, including grains and millets, poultry, meat, pork, fisheries, and minor forest produce.

Roadblock to the scheme: The mandatory sharing of expenditure with the states in the ratio of 60:40, and 10 % sharing by northeastern hilly states would be challenging amidst fiscal constraints during Covid-19.

Way Forward:

Research and Development: It is advisable to tap the vast network of agricultural research centres to bring out novel, nutritious, and convenient foods to attract customers.