The Hindu Business Line : Centre targets Rs 1-lakh-cr investment in food processing by 2015: Sahai

The Centre has set an investment target of about Rs 1 lakh crore for the food processing sector by 2015, according to the Union Minister for Food Processing, Mr Subodh Kant Sahai.

Addressing media persons on the sidelines of the 5th North-East Business Summit organised by the Indian Chamber of Commerce here on Friday, Mr Sahai said, “We are aiming around 20 per cent growth in the sector and value addition to the extent of 35 per cent by 2015.”

In the last five years, food processing sector in the country grew nearly 10 per cent with value addition of 10-15 per cent, he added.

The amount of agricultural production that is being processed in the country has increased from six per cent to only 10 per cent in the last three years.

GST impact

Raising concerns over the probable impact of the proposed Goods and Service Tax (GST) on the sector, Mr Sahai said, “Food cannot be taxed. The Centre has already brought down food related taxes to negligible level. I am also interacting with empowerment committees of VAT and with Dr Asim Dasgupta, who is heading the committee.”

“With the GST coming up, our efforts will be to restrict the State-level food taxes in the zero to four per cent range,” the Minister said.

There is a need for specific State-oriented policies to capitalise on the growth prospects in the food processing sector in the country, he said. “It is still a sunrise sector. Let the levels of value addition rise up to 50 per cent before the States can consider imposing higher taxes,” he said.

Food parks

The Ministry aims to set up 30 mega food parks by next year, Mr Sahai said, adding that so far 70 per cent work in six parks has been completed and the work in another four are in the process of completion. There are also plans to set up one food park in each of the North-Eastern States, he said.

“We have come up with several holistic policies for the processing industry. For cold chain, which is of critical importance to the food processing industry in protecting the shelf life of a produce, we are extending a subsidy of Rs 10 crore for setting up an integrated cold chain with forward and backward linkages,” he said.

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