Introduction:
The food processing industry involves the fundamental preparation and transformation of food products, contributing about 9% to India’s GDP and employing a significant portion of the workforce. Recognized as a key ‘Sunrise Industry,’ the FPI holds immense growth potential and is crucial for India’s economic development.
Body:
Status of FPI in India:
- The FPI plays a pivotal role in the Indian economy, contributing 9% to the GDP and employing 18% of the workforce.
- With an expected output of USD 535 billion by 2025-26, the sector is poised for substantial growth, creating nine million jobs by 2024.
- Foreign direct investments of USD 4.18 billion were attracted between 2014 and 2020, and processed food exports reached USD 53.2 billion in 2020-21.
Significance of Food Processing Industries for Indian Agriculture:
- Absorbing Rural Workforce: FPI can alleviate disguised unemployment by absorbing a significant share of workers from the agriculture sector.
- Food Security: Efficient food processing ensures the conversion of raw materials into consumable products, enhancing food security.
- Increasing Exports: Leveraging FPI positions India as a global player, contributing to foreign exchange reserves and addressing the current account deficit.
- Overall Economic Growth: FPI creates vital linkages among primary, secondary, and tertiary sectors, fostering economic growth.
- Curbing Migration: Establishing FPI in rural areas curbs rural-urban migration, promoting rural development.
- Doubling Farmers’ Income: FPI offers farmers opportunities for income enhancement through value addition and participation in the processed food supply chain.
Challenges faced by the FPI in India:
- Inadequate Infrastructure: Lack of modern infrastructure, including cold storage and efficient transport, hampers supply chain efficiency.
- Fragmented Supply Chain: A highly fragmented supply chain with numerous intermediaries affects traceability and product quality.
- Low Technology Adoption: Lagging behind in technology adoption impacts production efficiency and quality.
- Food Safety and Quality: Challenges in ensuring food safety and quality impact consumer confidence and export potential.
- Insufficient Credit Flow: Scarce credit limits growth potential for FPI companies.
Government Initiatives:
- Pradhan Mantri Kisan Sampada Yojana (PMKSY): Enhances FPI infrastructure, improves food product quality, and reduces wastage.
- National Mission on Food Processing (NMFP): Provides financial assistance to entrepreneurs and businesses in the FPI.
- Ease of Doing Business: Simplifies regulations, and procedures, and offers incentives for FPI investments.
- Technology Upgradation Fund Scheme (TUFS): Provides financial assistance for modernizing technology in the FPI.
- Infrastructure Development: Plans to establish food parks and cold chains nationwide to enhance FPI infrastructure.
- e-NAM Expansion: Expansion of e-NAM to 585 APMCs with primary processing facilities to support FPI.
Conclusion:
The food processing industry is integral to India’s economic and agricultural development. By strategically harnessing its transformative potential, India can bolster its economy, uplift farmer livelihoods, and make significant contributions to global food markets. Embracing the ‘Sunrise Industry’ sets the stage for a sustainable and prosperous future in agriculture and beyond.
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