Private sector's role sought in food processing

The government on Tuesday asked the private sector to invest in the food processing industry to build supply chain and help increase the country's share in the global trade.

The private sector can play an important role in the growth of the sector by setting up processing centres and storage facilities and help farmers in marketing their products, Minister of State for Micro, Small and Medium Enterprises Virbhadra Singh said at an Assocham function in New Delhi.

He said infrastructure was a major problem facing the sector. "We should reflect on how best we can increase the private sector's investment in these areas," he said.

Currently, the agriculture and food processing sectors face several problems, such as lack of cold storage facilities, inadequate technological know-how and marketing facilities.

In 2009-10, India's share in the international food trade was less than two per cent. In the last fiscal, the country's food and agriculture exports declined by nine per cent to $15.62 billion year-on-year.

Micro, small and medium enterprises constitute more than 80 per cent of the $74 billion food processing sector.

As per the fourth Census in 2006-07, there were about 1.53 million units providing employment to over 3.89 million.

Citing various constraints, both in backward and forward linkages in the food and agriculture sector, Singh said: "If we can get our act together, which we must, India can emerge as a leader in the global food industry.

"I would like the Indian industry to think big and to think globally about the future of this important sector of our economy."

He said there were various schemes of different ministries, such as agriculture, food processing and MSME, meant for the sector, which leads to duplication of schemes and they were not complementary to each other.

"I think all these ministries should sit together and look at various schemes to carry out changes. This will help to avoid overlap and ensure that wastages are cut in the food and agriculture sector," Singh said.

Ministry of Food Processing Industries Joint Secretary Ajit Kumar said at present commodities worth Rs. 35,000 crore are wasted each year. Indian businesses must reduce wastages and improve productivity to be able to export.

Under the broad framework of Vision 2015 Strategy and Action Plan, the government has introduced a number of supportive policies to meet its goals, like increased focus on agro-based small units in trade policy and automatic approval for foreign equity up to 100 per cent in food processing units.