Cabinet approves Rs 10,900 cr Production Linked Incentive scheme for food processing industry

The Union Cabinet on Wednesday approved the Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) in order to support Indian brands of food products in the international markets with an outlay of Rs 10,900 crores.

As per a release by the Cabinet, the Centre’s scheme aims to increase employment opportunities of off-farm jobs and ensuring remunerative prices of farm produce and higher income to farmers.

“The union cabinet today approved Rs 10,900 crores as incentive/subsidy under PLI scheme for the food processing industry,” Union Minister Piyush Goyal said while addressing a press conference here.

Speaking on the scheme, Union Minister Prakash Javadekar said that the decision has been taken to ensure remunerative prices to increase and build India brand in food processing, increasing employment potential and making it global and manufacturing champion.

The scheme will be implemented over a six-year period from 2021-22 to 2026-27 and will facilitate the expansion of processing capacity to generate processed food output of Rs 33,494 crores and generate employment for nearly 2.5 lakh persons by the year 2026-27.

“The objectives of the scheme are to support food manufacturing entities with stipulated minimum sales and willing to make a minimum stipulated investment for expansion of processing capacity and Branding abroad to incentivise emergence of strong Indian brands,” read the release.

Other aims include supporting the creation of global food manufacturing champions commensurate with India’s natural resource endowment, the creation of global food manufacturing champions, and strengthen select Indian brands of food products for global visibility and wider acceptance in the international markets.

The first component relates to incentivising manufacturing of four major food product segments viz. Ready to Cook/ Ready to Eat (RTC/ RTE) foods, Processed Fruits and Vegetables, Marine Products, Mozzarella Cheese.

Selected applicants will be required to undertake investment in plant and machinery in the first two years (in 2021-22 and 2022-23). The conditions of stipulated Minimum Sales and mandated investment will not be applicable for entities selected for making innovative/ organic products.

The second component relates to support for branding and marketing abroad to incentivise the emergence of strong Indian brands. For promotion abroad, the scheme envisages grant to the applicant entities for in-store branding, shelf space renting and marketing.

The scheme will be implemented across the country through a Project Management Agency (PMA) which will be responsible for the appraisal of applications/ proposals, verification of eligibility for support, scrutiny of claims eligible for disbursement of incentive.

The scheme is “fund-limited”, meaning the cost shall be restricted to the approved amount. The maximum incentive payable to each beneficiary shall be fixed in advance at the time of approval of that beneficiary.

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