Rationalisation of GST, creation of infrastructure at the farm gate and higher budgetary allocation for the food ministry are among the food-processing industry’s top expectations from the government. Processing of food, primarily fruits and vegetables, is crucial for doubling farmers’ income, as the government has promised, say industry executives.
Piruz Khambatta, chairman of soft drinks company Rasna International said that the government realises that growth of the food-processing sector and job creation in allied sectors is an answer to the rural distress and ensure that farmers don’t have to seek for loan wavers.
According to the Confederation of Indian Industry, the food-processing sector is gaining strong ground but the pace of this can be more
All India Food Processors’ Association president Subodh Jindal said that it is extremely unfortunate that while farmers are compelled to discard fruits and vegetables in the glut season, if someone converts those produces into pulp, it attracts 12% GST. The world has found a solution to save wastage of natural produce by strengthening primary processing to catch the glut produce and convert it into a stable form. He added that government subsidy has encouraged the setting up of large cold storages with capacity of 5,000-20,000 tonnes, and the scheme should now be for investment in small cold storage at farm gate which will be of 10-20 tonnes to give farmers some holding time for his crop in the glut season. Such facilities can be powered by solar panel. Further, financial support should be provided to existing and new processing units instead of allocating resources only to food parks.
Food processors said that the government must encourage indigenous development of low-cost food-processing equipment, particularly for the micro, small & medium scale enterprises that comprise 90% of the food processing application in the country in the next five years.Their association feels that India should harness the potential of its coastline of more than 7,500 km by modernising the marine-food catching and processing value chain.
Mayank Shah, category head at foods company Parle Products said that the government should allocate more funds for the rural sector to build a better road network. Also, higher job creation in rural India will foster demand for food products
Bureaucrat-turned-entrepreneur and food-processing consultant Gokul Patnaik said that cluster development should be the focus for the government instead of only focusing on large-scale food parks. And focus should shift to the development of pack houses, point of sale and logistics infrastructure.
The CII recommends accelerated depreciation to equipment and machinery used in all segments of the food-processing industry, tax deduction at 200% under Section 35 for promoting the ‘Made in India’ brand abroad, benefits under section 35 AD for cold-chain projects that commenced operation prior to April 2012, and extension of benefits given to infrastructure projects to food parks as well.
