Central government is going to start a new Scheme for Loans to Small and Cottage Food Processors in Unorganized Sectors. This scheme will enable them to upgrade their technology and skills and to get integrated with organized sector. India has the potential to become the food factory for the world in the next few years. This could be achieved by enhancing capacities of food preservation and processing which would also raise farmer’s income.
Ministry of Food Processing has taken various measures over the last 6 years to realize the PM Modi’s vision of Doubling Farmers Income by 2022. Food processing is one of the largest industry for employment generation and around 80% of processing industry is still unorganized.
The govt. targets micro and cottage food processors and rural women who are processing products like pappad, chutney, achaar etc. through small operations out of their homes.
Loan Scheme 2020 for Small and Cottage Food Processors
Ministry of Food Processing Industries will launch Loan Scheme for Small & Cottage Food Processors in Unorganized Sector. India is the largest producer of food in the world. However at this time, India’s food processing industry is at nascent stage. India is able to process only 10% of its total production. Accordingly, there is very high level of wastage which leads to consumer prices shooting up on one hand and farmers not getting their due on the other. Henceforth, Ministry of Food Processing Industries is working on creating infrastructure for food processing and preservation.
Loan Scheme 2020 for Small and Cottage Food Processors will ensure that farmers get full value for their crops. To enable farmers to earn higher income through value-addition to their agri produce. Along with this scheme, govt. will offer guidance and subsidies to support farmers and connect them with relevant markets. To create markets, govt. has allowed 100% FDI in multi-brand retail for food which is produced or manufactured in India.
In order to attract global food giants to look at sourcing from India, central govt. organized the World Food India 2017. This becomes turning point to attract FDI in the food processing sector and FDI in food processing sector has nearly doubled to 913 million dollars.
Small / Cottage Food Processors Loan Scheme Benefits
The following are the benefits of Loan Scheme for Small & Cottage Food Processors in Unorganized Sectors:-
- Up-gradation of Technology
- Enhancement of Skills
- Improvement in Food Safety Standards of Products
- Integration with the organized sector
In another flagship PM Kisan Sampada Yojana, around Rs. 6,000 crore has been sanctioned to create infrastructure to improve agricultural productivity. Moreover, 800 units of infrastructure are being setup over the next 2-3 years to ensure adequate capacity is created for food processing and preservation. Central Govt. has taken other measures to boost food processing sector which includes creation of a corpus of Rs. 2,000 crore under NABARD. This corpus will offer credit through NABARD at cheaper rates to food processing units in designated Food Parks.