Government subsidies for food processing industries are financial incentives and support mechanisms provided by governments to encourage investment, innovation, and sustainability within the sector. These subsidies are typically designed to benefit various stakeholders, including food processors, farmers, consumers, and the overall economy.
Recently MOfpi invited proposal vide expression of interest for prospective Entrepreneurs under the following component scheme of Pradhan Mantri Kisan Sampada Yojana
Types Of Government Subsidies for Food Processing Industries
1. Cold Chain
The objective of the Scheme of Cold Chain,
Value Addition and Preservation Infrastructure is to provide integrated cold chain and preservation infrastructure facilities, without any break, from the farm gate to the consumer. It covers creation of infrastructure facility along the entire supply chain viz. pre-cooling, weighing, sorting, grading, waxing facilities at farm level, multi product/ multi temperature cold storage, CA storage, packing facility, IQF, blast freezing in the distribution hub and reefer vans, mobile cooling units for facilitating distribution of horticulture, organic produce, marine, dairy, meat and poultry etc. The scheme allows flexibility in project planning with special emphasis on creation of cold chain infrastructure at farm level. – subsidy consultants for mofpi schemes for food processing industries
Pattern of Assistance
- storage infrastructure including Pack House and Pre cooling unit, ripening chamber and transport infrastructure, grant-in-aid @ 35% for General Areas and @ 50% for North East States, Himalayan States, ITDP Areas & Islands, of the total cost of plant & machinery and technical civil works will be provided.
- For value addition and processing infrastructure including frozen storage/ deep freezers associated and integral to the processing, grant-in-aid @ 50% for General Areas and @ 75% for North East States, Himalayan States, ITDP Areas & Islands, will be provided.
- irradiation facilities grant-in-aid will be provided @ 50% for General Areas and @ 75% for North East States, Himalayan States, ITDP Areas & Islands.
2. Creation/ Expansion of Food Processing/ Preservation Capacities (Unit Scheme)
The main objective of the Scheme is creation of processing and preservation capacities and modernisation/ expansion of existing food processing units with a view to increasing the level of processing, value addition leading to reduction of wastage. The processing activities undertaken by the individual units covers a wide range of post-harvest processes resulting in value addition and/or enhancing shelf life with specialized facilities required for preservation of perishables.
While expansion of processing capacity is necessary to increase the level of processing and reduce wastage, the induction of modern technology is intended to make a clear difference in terms of process efficiencies as well as improving the quality of the end product. The setting up of new units and modernization/ expansion of existing units are covered under the scheme.
Eligible sectors:
Food processing sectors eligible under the Scheme includes – (i). Fruits & vegetables processing, (ii). Milk Processing (iii). Meat/poultry/fish processing, (iv). Ready to Eat / Ready to Cook Food Products/ Breakfast cereals/ Snacks / bakery and other food products including nutritional health foods. (v). Grains/pulses, oil seed milling and processing based on modern technology. (vi). Modern Rice milling. (vii). Other agri-horti products including spices, coconut, soybean, mushroom processing, honey processing, etc. (viii). Fruits/ Honey based wines. (ix). Natural Food flavors, food additives/ food extracts & colours, oleoresins, guar gum, cocoa products etc. (x). Manufacturing jaggery from sugarcane and value added products from jaggery (as raw material) except sugar mills. (xi). Any other sector that makes food products fit for human consumption. (xii). Animal feed manufacturing unit to be set up in Mega Food Parks and Agro Processing Clusters approved by the Ministry from time to time.
Pattern of Assistance
The Scheme envisages grants-in-aid @35% of eligible project cost in general areas and @50% of eligible project cost in the North East States including Sikkim and difficult areas namely Himalayan States (i.e. Himachal Pradesh, Jammu & Kashmir and Uttarakhand), State notified ITDP areas & Islands subject to max. of Rs. 5.00 crore per project.
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3. Agro Processing Cluster Scheme
The scheme aims at development of modern infrastructure and common facilities to encourage group of entrepreneurs to set up food processing units based on cluster approach by linking groups of producers/ farmers to the processors and markets through well-equipped supply chain with modern infrastructure. Each agro processing clusters under the scheme have two basic components i.e. Basic Enabling Infrastructure (roads, water supply, power supply, drainage, ETP etc.), Core Infrastructure/ Common facilities (ware houses, cold storages, IQF, tetra pack, sorting, grading etc) and at least 5 food processing units with a minimum investment of Rs. 25 crore
Pattern of Assistance
- The Scheme envisages grants-in-aid @ 35% of eligible project cost in general areas and @50% of eligible project cost in the North East States including Sikkim and difficult areas namely Himalayan States (i.e. Himachal Pradesh, Jammu & Kashmir and Uttarakhand), State notified ITDP areas, Islands and SC/ST entrepreneurs subject to max. of Rs. 10.00 crore per project.
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4. Operation Greens – Long Term Interventions
Component: –
- Formation of new FPOs in the cluster and/or training / workshop of existing farmers /FPOs
Eligible cost in this regard will be as per SFAC norms, subject to maximum limit of 5% of total eligible project cost. PIA may take support of SFAC/NABARD/Universities/ Institutions for capacity building and strengthening of FPOs
- Post –harvest processing facilities: –
- Appropriate storage such as staging cold room / dry storage/ cold storage/ frozen storage/ CA storage
- Integrated pack house and machinery & equipment for primary processing/ value addition such as cutting, dicing, slicing, pickling, pulping etc. with mechanized sorting & grading line/ packing line/ waxing line
- Secondary processing line including IQF, Blast Freezer etc.;
- Quality test equipment for captive
- Agri- Logistics
- Controlled temperature/ ventilated vehicle with or without raking
- Marketing infrastructure (anywhere in the country not necessarily in identified production clusters)
Retail chain of outlets for perishable products with facilities such as frozen storage / cold room / cold storage / deep freezers / refrigerated display cabinet/ chillers/ packing/ packaging/ ripening chamber etc.
Pattern of Assistance:-
- Integrated value chain development project: Maximum grant-in aid would be 15 cr project
- Standalone Post Harvest Infrastructure Projects: Maximum grant-in aid would be 10 cr project
- Grants in aid will be @35% in eligible project cost for projects general areas & 50 % of eligible project in projects difficult areas as well as for project of SC/ST, FPO & SHG
- No upward revision, for any reason whatsoever, in approved in grant n aid will be considered
- In case of proposals requesting for dropping of any of the approved components, the proportionate grant in aid
- No grant in aid shall be payable on any expenditure towards of eligible project component of the project of any nature whatsoever, made before issuance of approval letter of ministry. The same shall be verifiable from bank statement/invoices to be submitted at the request for release of various installment of grant in aid
- Grant in aid will be considered in respect of eligible project component
- Proposals received from entities where SC/ST hold at least 51% stake will be treated as SC/ST proposals
- If there is any reduction in stake of SC/ST below 51% during implementation of the project, such project shall be cancelled & grant in aid release, if any shall be ordered to be recovered with 10% annual interest
- Grant in aid will be released subject to availability of funds
5. SCHEME OF SETTING UP / UP GRADATION OF FOOD TESTING LABORATORIES
Eligible Items For Calculation Of Grant in aid
Equipment:
It Includes the equipment essential for the testing requirement of the food and food product being produced and manufactured in the catchment Area of the food testing laboratories
Technical Civil work and furniture and fixtures
It Includes only the component of civil work and furniture & Furniture’s essentials for installation and operationalization of the equipment
Eligible Entities
Any private organizations ( JV , Partnership , LLP )
Eligible Criteria
Term loan from the Bank for an amount not less than 20% of the total project cost in respect of proposals from General Areas. In case of proposals from Difficult Areas or proposals from SC/ST , term loan amount shall not be less than 10% of the total project cost.
Note: Difficult Area for proposals under this Scheme means North-Eastern States (including Sikkim), State of Uttarakhand, State of Himachal Pradesh, Union Territories of Jammu & Kashmir and Ladakh, State Notified ITDP areas and Islands (Union Territories of Andaman & Nicobar and Lakshadweep).
NON REFUNDABLE FEE: 20000 in favour of “ PAY AND ACCOUNTS OFFICERS , Ministry of Food Processing Industries, New Delhi”.
Provided that the non – refundable fee shall be Rs . 15000for applications from SC/ST
Pattern of Assistance
Grants-in-aid will be considered @50% for projects in General Areas and @70% for projects in Difficult Areas as well as for projects of SC/ST of eligible cost of project AND 2 % of the eligible cost of approved equipment or Rs.15lakh , whichever is lower towards TCW and furniture and fixtures
Private Organization / entities are eligible for grant-in-aid of
- 50%of the eligible cost of equipment and
- 2% of the Eligible cost of approved equipment or Rs. 15.00lakh , whichever is lower , toward technical civil work and Furniture & Fixtures
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