Elaborate the policy taken by the Government of India to meet the challenges of the food processing sector.

Food processing is a sunrise sector in India and is recognized as a Special Focus Sector in the National Manufacturing Policy. It has great potential for driving the rural economy, synergizing between agriculture, industry and consumer. But it is marred with various challenges which need to be addressed first.

Challenges.

1. Inadequate infrastructure facilities.
2. Seasonality of operations, perishability and low-capacity utilisations.
3. Institutional gaps in supply chain.
4. Lack of focus on quality and SPS measures.
5. Requirement of multiple clearances for setting up of food processing units.

Government Initiatives for FPIs.

1. Pradhan Mantri Kisan Sampada Yojna (PMKSY): Umbrella scheme under MoFPI providing a host of financial assistance to FPIs. Sub-schemes include;

• Mega Food Parks.
• Integrated Cold Chain and Value Addition Infrastructure.
• Infrastructure for Agro-processing Clusters.
• Operation Greens, etc.

2. Agricultural Marketing Infrastructure: Sub-scheme of Integrated Scheme for Agricultural Marketing (ISAM), for construction/renovation of warehouses in the rural areas.

3. Agriculture Infrastructure Fund: ₹1 lakh cr will be provided to feasible projects for post-harvest management infrastructure.

4. Introduction of Production-Linked Incentive (PLI) Scheme.

5. 100% FDI, permitted under the automatic route in FPIs.

6. Food and Agro-based processing units can avail loans under Priority Sector Lending (PSL). 

7. Nivesh Bandhu: portal under MoFPI, for all the investors in the food processing sector.

8. A special fund, Food Processing Fund, been set up in NABARD for extending affordable credit.

A well-developed food processing sector is expected to increase farm gate prices, reduce wastages, ensure value addition, promote crop diversification, generate employment opportunities as well as export earnings.

If challenges are resolved, it will not only push Indian economy towards $5 trillion, but will also help reduce farm distress.