Boost to food processing

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.

• Boost exports of processed products: through provisioning of innovative, packaged and branded foods at competitive rates.