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Cabinet approves umbrella scheme for food processing sector

04 May 2017

The union cabinet on Wednesday gave its approval for a new central sector scheme, called Scheme For Agro-Marine Processing And Development Of Agro-Processing Clusters (SAMPADA), an umbrella scheme incorporating all ongoing schemes of the ministry of food processing.

The umbrella scheme will cover mega food parks, integrated cold chain and value addition infrastructure, food safety and quality assurance infrastructure, etc as also new schemes like infrastructure for agro-processing clusters, creation of backward and forward linkages, creation and expansion of food processing and preservation capacities.

The union cabinet chaired by Prime Minister narendra Modi on Wednesday gave its approval for restructuring the schemes of the ministry of food processing industries (MoFPI) under new central sector scheme scheme for Agro-Marine Processing and Development of Agro-Processing Clusters (SAMPADA) for the period 2016-20, which will be coterminous with the recommendations of the 14th Finance Commission.

SAMPADA with an allocation of Rs6,000 crore plans to leverage investment of Rs31,400 crore, handle 33.4 million tonnes of agro-produce valued at around Rs1,04,125 crore, benefit 2 million farmers and generate 5,30,500 direct and indirect employment in the country by the year 2019-20.

The objective of SAMPADA is to supplement agriculture, modernise processing and decrease agri-waste.

SAMPADA, a comprehensive package to give a renewed thrust to the food processing sector in the country, aims to encourage entrepreneurs to set up food processing units based on a cluster approach, provide effective and seamless backward and forward integration for processed food industry by plugging gaps in supply chain and creation of processing and preservation capacities and modernisation / expansion of existing food processing units.

The implementation of SAMPADA will result in creation of modern infrastructure with efficient supply chain management from farm gate to retail outlet. It will not only provide a big boost to the growth of food processing sector in the country but also help in providing better prices to farmers and is a big step towards doubling of farmers' income. It will create huge employment opportunities especially in the rural areas. It will also help in reducing wastage of agricultural produce, increasing the processing level, availability of safe and convenient processed foods at affordable price to consumers and enhancing the export of the processed foods, says a cabinet release.

The food processing sector has emerged as an important segment of the Indian economy in terms of its contribution to GDP, employment and investment. During 2015-16, the sector constituted as much as 9.1 of gross value adition in manufacturing and 8.6 per cent in agriculture.

To boost the food processing sector, the government has taken various measures to arrest post-harvest losses of horticulture and non-horticulture produce.

The ministry has accorded approvals to 42 mega food parks and 236 integrated cold chains for creation of modern infrastructure for the food processing along the value chain from the farm to the market. Out of 42 mega food parks, 8 are operational. Of this, 6 mega food parks have been made operational during the last 3 years. Another 4 mega food parks are targeted for operationalization in next three months.

Similarly, out of 236 cold chains, 101 cold chains have been sanctioned recently in March 2017. As of now, 100 cold chains are ready for operations, of which, 63 cold chains have been made operational during last 3 years.

Besides, to give an impetus to food processing, the government has taken various other measures, including 100 per cent FDI in trading, including through e-commerce, in respect of food products manufactured or produced in India. This will benefit farmers immensely and will create back end infrastructure and significant employment opportunities.

The government has also set up a special fund of Rs2,000 crore in NABARD to make available affordable credit at concessional rate of interest to designated food parks and agro processing units in the designated food parks.

Food and agro-based processing units and cold chain infrastructure have been brought under the ambit of priority sector lending (PSL) to provide additional credit for food processing activities and infrastructure thereby boosting food processing, reducing wastage, create employment and increasing farmers' income.

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