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Food Processing in India

Food Processing in India. The Indian food processing industry was valued at € 92 billion in 2005, a growth of 10% over the previous year.

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Food Processing in India

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  1. Food Processing in India The Indian food processing industry was valued at € 92 billion in 2005, a growth of 10% over the previous year. Indian food processing industry is becoming an attractive FDI destination; it attracted around € 790millionFDI during 1991-2005 which is 3.3% of total FDI inflow in India. The Food Processing Industry sector in India is one of the largest in terms of production, consumption, export and growth prospects.

  2. Sectorial Overview • India has arable land of 184 million hectares and produces annually 90 million tonnes of milk • 150 million tonnes of fruits and vegetables • 485 million livestock, 204 million tonnes food grain • 6.3 million tonnes fish, 489 million poultry and 45,200 million eggs • processing level is very low i.e. around 2.20% in fruits and vegetables, 35% in milk, 21% in meat and 6% in poultry products • India's share of processed food is about 1.6%. Hence, there is immense potential for growth in this sector.

  3. Fruits and Vegetable Processing • The capacity of fruits and vegetables processing increased from 1.1million tons in 1993 to 2.1 million tons in 2006. • Meat and Meat Processing • Present processing level of buffalo meat is estimated at 21 %, poultry 6 %, and marine products 8 %. • Dairy Processing • Milk production is over 90 million tonnes. Per capita milk consumption is 75 Kgs. • Fish Processing • Long coast line of over 8000 kms., 50600 sq. kms of continental shelf area and 2.2 million sq. km. of exclusive economic zones, India is rich fishery resources. • Consumer Food Industries • Production is about 4.00 million tons per year. • During the year 2005-06, financial assistance was sanctioned by Ministry of Food Processing for 27 consumer food-processing units. • The total inflow of FDI in FPI sector up to 2005-06 was € 958 million

  4. WHY ENTER THE INDIAN FOOD PROCESSING SECTOR? • Seventh largest country, with extensive administrative structure and independent judiciary, a sound financial network and above all a stable and thriving democracy. • It is one of the biggest emerging markets, with over 900 million population and a 250 million strong middle class. • Rapid urbanisation, increased literacy and rising per capita income , have all caused rapid growth and changes in demand patterns, leading to tremendous new opportunities for exploiting the large latent market. An average Indian spends about 50% of household expenditure on food items. • Liberalised overall policy regime, with specific incentives for high priority food processing sector, provides a very conducive environment for investments and exports in the sector. • Very good investment opportunities exist in many areas of food processing industries, the important ones being : fruit & vegetable processing, meat, fish & poultry processing, packaged, convenience food and drinks, milk products etc.

  5. Import Duty Import Duty on Food processing equipments/ Machinery is as below: Import Duty - 15 % Additional Duty - 16 % Educational Cess - 2% Total Duty - 36%

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