India’s Food processing Industry
(Basics to know)
Syllabus Topic: IAS Mains GS Paper 3 – Food
processing and related industries in India – Scope and Significance, location,
upstream and downstream requirements, supply chain management
Food
processing involves certain methods and techniques used to transform raw
ingredients into food for the consumption of humans and animals.
India
being one of the largest food producer in the world has advantage of becoming
food processing hub.
Food
processing industry is of enormous significance for India’s development because
of the vital linkages and synergies that it promotes between the two pillars of
the economy – Industry and agriculture.
The
Indian food processing industry accounts for 32% of the country’s total food
market. The food processing industry includes a diverse group of companies
involved in the processing of products like fish, meat, milk, crops.
There
are opportunities in post-harvest management such as
1.
Primary processing
2.
Storage
3.
Preservation infrastructure
4.
Cold chain
5.
Refrigerated transportation
India
has immense potential for food processing and value addition, especially in
niche areas such as organic and fortified foods.
Given
the trade in production of food commodities, the food processing industry in
India is on an assured track of growth and profitability. It is expected to
attract phenomenal investment in capital, human, technological and financial
areas.
With
globalisation and increasing trade across the borders approximately about 460
million tonnes of food valued at $ 3 billion is traded annually. India has
thus, a great potential for global trade in agriculture and processed food
products.
There
is an opportunity for large investments in food and food processing
technologies, skill development and equipment.
The
major interventions in this context are, for example,
a.
canning,
b.
dairy and food processing,
c.
specialty processing,
d.
packaging,
e.
frozen food/refrigeration and
f.
thermo processing.
Fruits
and vegetables, fisheries, milk and milk products, meat and poultry,
packaged/convenience foods, alcoholic beverages and soft drinks and grains.
Health
food and health food supplements are other rapidly rising segments of this
industry.
With
a number of fiscal relief and incentives, to encourage commercialisation and
value addition, Government of India has accorded ‘high priority’ status to the
food processing industry.
Food
processing is recognised as the priority sector in the National Manufacturing
Policy (2011).
The
Ministry of Food Processing Industries (MOFPI) has been set up as a nodal
agency for formulation and implementation of the policies and plans for the
food processing industries.
With
an overall objective of positioning India as the ‘Food Basket’ to the world,
several initiatives have been undertaken with the objective of promoting
investments, innovation and bringing best practices. This vision is in line
with the ‘Make in India’ initiative of the Government.
India
has a strong raw material base for the food processing industry.
India
is one of the largest producers of certain fruits, vegetables, pulses, cereals
and dairy products such as mangoes, papaya, potatoes, onions, ginger, check
peas, rice, wheat, groundnuts, milk and eggs among others.
Food
processing is a key contributor to employment generation in India
Policymakers
have identified food processing as a key sector in encouraging labour movement from
agriculture to manufacturing.
By
2024, food processing sector is expected to employ 9 million people in India.
Some of the major initiatives taken
by the Government of India to improve the food processing sector in India are
as follows:
- The Government of India aims to boost growth
in the food processing sector by leveraging reforms such as 100 per cent
Foreign direct investment (FDI) in marketing of food products and various
incentives at central and state government level along with a strong focus
on supply chain infrastructure.
- In Union Budget 2017-18, the Government of
India has set up a dairy processing infra fund worth Rs 8,000 crore (US$
1.2 billion).
- The Government of India has relaxed foreign
direct investment (FDI) norms for the sector, allowing up to 100 per cent
FDI in food product e-commerce through automatic route.
- The Food Safety and Standards Authority of
India (FSSAI) plans to invest around Rs 482 crore (US$ 72.3 million) to
strengthen the food testing infrastructure in India, by upgrading 59
existing food testing laboratories and setting up 62 new mobile testing
labs across the country.
- The Indian Council for Fertilizer and Nutrient
Research (ICFNR) will adopt international best practices for research in
fertiliser sector, which will enable farmers to get good quality
fertilisers at affordable rates and thereby achieve food security for the
common man.
- The Ministry of Food Processing Industries
announced a scheme for Human Resource Development (HRD) in the food
processing sector. The HRD scheme is being implemented through State
Governments under the National Mission on Food Processing.
The scheme
has the following four components:
- Creation of infrastructure facilities for
degree/diploma courses in food processing sector
- Entrepreneurship Development Programme (EDP)
- Food Processing Training Centres (FPTC)
- Training at recognised institutions at
State/National level
The adoption of food safety and quality
assurance mechanisms such as Total Quality Management (TQM) including ISO 9000,
ISO 22000, Hazard Analysis and Critical Control Points (HACCP), Good
Manufacturing Practices (GMP) and Good Hygienic Practices (GHP) by the food
processing industry offers several benefits.
It would enable adherence to stringent quality and hygiene
norms and thereby protect consumer health, prepare the industry to face global
competition, enhance product acceptance by overseas buyers and keep the
industry technologically abreast of international best practices.
Key challenges identified overall for the food processing
sector
1. Lack of government certified labs
2. Lack of cold chain infrastructure
3. Lack of specialised training programs
4. Inadequate skill sets at different levels in food
processing industry
5. Capital intensive sector