Government targets 25 pc food processing level by 2031; mulls policy measure to boost investment
Addressing a conference organised by industry body FICCI, he cited a recent report by Crisil which highlighted that the food processing level has increased to 17 per cent in 2023 from 10 per cent in 2010-11.
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Context
The has set a target to increase India's food processing level from the current 17% to 25% by 2031. To achieve this, the government is considering a new policy initiative, potentially a 'National Processing Mission' or , building on the success of the current (PLISFPI). This move aims to transition India's surplus agricultural production from volume to value, boosting exports and employment.
UPSC Perspectives
Economic
The food processing sector is a critical link between agriculture and manufacturing, often termed a 'sunrise sector' in India. The current push to increase processing levels addresses a core economic challenge: reducing post-harvest losses and enhancing value addition. A processing level of 25% by 2031 would significantly improve farmers' income by creating a more robust demand for raw agricultural produce. The success of the highlights the effectiveness of targeted subsidies in capacity building. The scheme's Rs 10,900 crore outlay has successfully incentivized large-scale manufacturing and global branding. The proposed or a National Processing Mission indicates a shift towards a more comprehensive strategy, addressing the needs of the sector where over 90% of units are (MSMEs). This requires focusing on technology upgradation, credit access, and supply chain logistics for these smaller units to ensure inclusive growth.
Governance
Effective governance in the food processing sector requires a multi-pronged approach balancing industry growth with consumer safety. The Food Processing Secretary's emphasis on non-compromise regarding food safety regulations underscores the role of bodies like the (FSSAI). As processing levels increase, ensuring adherence to quality standards becomes paramount for both domestic consumption and international trade. The initiative to create a 'Bharat brand' for processed food and beverages demonstrates proactive governance in global market positioning. This aligns with broader initiatives like 'Make in India' and 'Atmanirbhar Bharat'. The government's role transitions from merely a regulator to a facilitator, actively intervening to provide visibility to Indian cuisines globally. The challenge lies in harmonizing state and central policies to create a seamless national market and efficient cold chain infrastructure.
Social
The expansion of the food processing sector has profound social implications, particularly concerning employment and nutrition. The sector is highly labor-intensive, and the noted that the PLI scheme contributed almost 48% to employment generation within its scope, highlighting its inclusive nature. Increased processing capacity can absorb surplus agricultural labor, providing alternative livelihoods in rural and semi-urban areas. Furthermore, the transition from 'volume to value' is crucial for achieving the goal of 'nutrition for all'. Food processing can extend the shelf life of perishable, nutrient-dense foods (like fruits and vegetables) and allow for fortification (adding essential vitamins and minerals). This can be a strategic tool to combat hidden hunger and malnutrition, aligning with national health objectives. The focus must be on ensuring that processed foods are not just value-added but also nutritionally beneficial.