Food Processing

  • India offers the largest diversified production base and has a growing food industry. India is1
    • World’s largest milk-producing nation
    • World’s largest producer, consumer and exporter of spices
    • World’s second-largest producer of food grains, fruits and vegetables.
    • India is a Second-largest producers of Wheat
  • The total geographical area of India is 328.7 mn ha and the Gross Cropped Area is 198.4 mn ha with a cropping intensity of 142%.2
  • An investor facilitation portal known as Nivesh Bandhu, developed by the Ministry of Food Processing Industries is in place to assist investors in investment decisions. 
  • The Ministry of Food Processing Industries, Government of India has notified 253 designated food parks in different states for the purpose of availing affordable credit from a special fund with NABARD. 3
  • Loans to food & agro-based processing units & cold chains have been classified under agriculture activities for Priority Sector Lending (PSL). 3
  • Ministry has approved 23 Cold Chain projects, 3 Agro-Processing Clusters, 22 Food Processing Units in Uttar Pradesh under PMKSY. 
  • Andhra Pradesh, Maharashtra, Uttar Pradesh, Madhya Pradesh, Gujarat, Karnataka and Tamil Nadu are the major Fruits producing States, whereas Uttar Pradesh, West Bengal, Madhya Pradesh, Bihar, Gujarat, Maharashtra and Odisha are the major Vegetables producing States of the country.
  • Food Processing sector engages maximum number of people with 20.05 lakhs consisting  12.32 % of the total employment share.
  • India is the world’s second-largest sugar producer after Brazil.
Reasons to Invest
  • In addition to the rich resources, India has the sixth-largest food and grocery market globally and the country can provide a perfect blend of traditional and hygienic food, processed and packaged according to modern technology. 4
  • The Food processing industry in India is indigenous because simple home-based techniques such as fermentation have resulted in the creation of worldwide acknowledgement of Indian pickles, papads, chutneys and murabba.
  • The Gross Cropped Area stands at 198.4 mn ha and the reported net sown area is 140.1 mn ha while the total geographical area of the country is 328.7 mn ha, as per the land use statistics 2014-15. 5
  • Benefiting from such a geographical advantage, India is the largest producer of milk, bananas, mangoes, guavas, papaya, ginger, okra, pulses, wheat, tea and sugarcane. 6 
  • Nivesh Bandhu brings together Central and State Government policies and incentives provided for the food processing sector. It is a one-stop platform for all stakeholders of the industry, including farmers, processors, traders, and logistics operators. To further help an investor make strategic decisions, the portal also includes a Food Map that can help investors find various project locations. 8
  • Under PKVY, an amount of total INR 29.59 cr has been released to Assam for 220 clusters benefitting 11000 farmers for 4425 ha area against the target 4451 since 2015-16 to till date.
  • Agriculture plays a vital role in India’s economy. 54.6% of the total workforce in the country is engaged in agricultural and allied sector activities (Census 2011) and accounts for 16.5% of the country’s Gross Value Added (GVA) for the year 2019-20 (at current prices).31
  • A new provision has been introduced to the Legal Metrology Rules 2011 to indicate the unit sale price on pre packed commodities, which will allow easier comparison of the prices of the commodities at the time of purchase.
  • Fish production is 130 lakh tonnes and export worth INR 46,000 crore. GOI aims 22 mn tonnes of fish production and export to the tune of INR one lakh crore by 2025. 
  • In view of large-scale malnutrition, anaemia among children and women, GOI aims towards increasing the nutritious content of rice through fortification. Fortified rice distribution is being taken up under different government schemes including Public Distribution System, Mid-Day Meal among others and will be completed by 2024.
  • GOI has set a target to achieve one lakh crore export from the fishing sector by 2024-25 and also make it environment friendly. 
  • GOI is implementing Matsya Sampada Yojana and has infused INR 20,000 crore in the fishing sector through the scheme. The government is also focusing on Seaweed farming and empowering fisherwomen and promoting entrepreneurship in the sector.
  • Country’s first-of-its kind, dedicated business incubator to be known as LINAC- NCDC Fisheries Business Incubation Centre (LlFlC) in Haryana’s Gurugram is established with costing of INR 3.23 crore to nurture fisheries start-ups under real market-led conditions.
  • Startups and Farmer Producer Organizations (FPOs) will help in upscaling millets’ value chain, connecting to domestic and international markets and will create an inclusive framework to make India Millet Hub of the World.
  • An integrated and hi-tech online portals on export/import of agricultural commodities and pesticides registration is launched to boost Ease of Doing Business in the sector.
Key Achievements
  • 19 Mega Food Parks are functioning in the country as compared to two in 2014. The government targets to take this number to more than 40.
  • A dedicated Investors' Portal and mobile application called 'Nivesh Bandhu' has been launched. 24 
  • MoUs signed between the Government of India and the United Nations' World Food Programme for cooperation during 2019 – 2023. 25
  • NITI AAYOG along with National Informatics Centre (NIC) understood the comparative study of the Data Governance Quality Index(DHQI) of 72 Central Ministries/Departments. In this survey, the Ministry of Food Processing came 1st among the other ministries. 30
  • Under the PM FME Scheme, out of INR 15 cr allocated by the Ministry of Finance, INR 89.48 cr was released to 30 states/YTs and INR 5 cr each for NIFTEM and IIFPT. 30
  • In 2021, about 6.71 MLT foodgrains were allocated under PMGKAY in Telangana.
  • Integrated Cold Chain and Value Addition Infrastructure Scheme” which a component of the Pradhan Mantri Kisan Sampada Yojna (PMKSY) have 353 projects approved under the scheme till date for various States/UTs.
  • Department of Financial Services under the Ministry of Finance to provides INR 2 lakh cr Concessional credit boost to 2.5 cr farmers through Kisan Credit Cards.34
  • ODOP proposals received from 5 states/UTs, viz Andaman and Nicobar Island, Chhattisgarh, Jammu and Kashmir, Meghalaya and Telangana are under consideration for approval.36 
  • New Education Policy will be helpful in making the agricultural sector more prosperous and employment-oriented.
  • National e-Governance Plan in Agriculture (NeGPA) is launched towards the Mission of Digital Agriculture. This scheme aims to achieve rapid development in Indian Agriculture Sector through the use of Information & Communication Technology (ICT).
  • MoFPI has sanctioned 37 Mega Food Parks (MFPs) and given in-principle approval for 2 MFPs in the country.
  • The Ministry of Food Processing Industries, in association with the NAFED, launches the first ODOP's ‘Dilli Bakes’ in the bakery products category of the PMFME Scheme 
  • Honey Mission has been started to bring sweet revolution and the Central Government has spent INR 500 crore on it. Under the GOI's plan to form 10 thousand new Farmer Producer Organizations (FPOs), FPOs of honey-producing farmers are also being created. To test honey properly, labs have been set up in many places in the country and processing facilities are also being increased.
  • MoU is signed between Department of Animal husbandry & Dairying and Ministry of Food Processing Industry to achieve the goal for income generation for sustainable development of rural poor.
  • Food grains to be issued from FCI depots under various welfare schemes of the GOI will be checked in-house for pesticide residues, Mycotoxin, Uric acid and fortification level of vitamins to ensure the food grain safety and nutritional security of the consumers.
  • With the aim to provide warehousing facilities at the farm gate, registration fees is substantially reduced to INR 500 for FPOs/PACS/SHGs as compared to INR 5000 to INR 30,000/- for other conventional warehouses along with a reduction in other charges.
  • During the last three years, 349,861.6 quintals of breeder seed of more than 1,300 varieties of 57 field crops has been produced. ICAR Seed Project is operating at 63 cooperating centres under National Agricultural Research System which is contributing quality seed production of newly released varieties in the country.           
  • Upto 16th May 2022, a quantity of 180.71 LMT of wheat has been procured, benefiting over 16.99 Lakh farmers with an MSP value of  INR 36,412.86 crore.
  • Upto 16th May 2022, a quantity of 777.97 LMT of Paddy (includes Kharif Crop 751.84 LMT and Rabi Crop 26.13 LMT) has been procured, benefiting 111.64 Lakh farmers with MSP value of INR 1,52,482.46 crore.
  • 170 FPOs/FPCs created under Mission Organic Value Chain Development for North Eastern Regions.
  • Through Kisan Rail, Indian Railways has disbursed subsidy of INR 110 crore approximately for evacuation of about 5.50 Lakh MT of Fruits & Vegetables across the country under the scheme in 2021.
  • India emerges as largest exporters of cucumber and gherkins in the world. India has crossed the USD 200 mn mark of export of agricultural processed product, - pickling cucumber, which is globally referred as gherkins or cornichons, in the last financial year. 
  • TRIFED is involved in promoting beekeeping in tribal parts of the country and procuring wild honey and has also exported to various countries honey worth INR 115 lakhs during 2020-21.
  • Government efforts proved effective in increasing area under Zaid crops from 29.71 to 80.46 lakh hectares in last three years.
  • Export of Tractors sees a growth of almost 72% since 2013. 
  • Jawaharlal Nehru Krishi Vishwavidyalaya (JNKVV) has developed two varieties each of oats and wheat, one of rice and three of niger which were tested under various agro-climatic conditions of the State(s) through All India Coordinated Research Projects.
  • There is well established system available for analysis of seed quality of native Indian crop and trees in the Country. 161 State Seed Testing Laboratories and six Central Seed Testing Laboratories are functioning in the Country. These laboratories are analyzing seeds of native Indian crop and trees for various quality parameters.
  • The institutes have developed wheat varieties that contribute nearly 60 mn tons of wheat to the nation’s granary worth INR 80,000 crores annually. Basmati varieties developed by the institute predominate basmati cultivation in India accounting for 90% of the total foreign exchange (INR 29,524 crores) earned through the export of Basmati rice amounting to INR 32,804 crores.
  • 6 varieties of fruits and vegetables are developed viz., two varieties of mango Pusa Lalima, Pusa Shresth, brinjal variety Pusa Vaibhav, palak variety PusaVilayati palak, cucumber variety Pusa Gynoecious Cucumber Hybrid-18 and Pusa Alpana variety of rose. 
  • There are 726 Testing Laboratories for food products in the country. Out of these, 585 food testing laboratories have obtained Accreditation as per the international standards.
Recent Announcements

2nd May 2022: India & Germany signs a joint declaration on agro-ecology and sustainable management of natural resources.

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22nd April 2022: APEDA inks MoU with National Research Development Corporation (NRDC) to focus on climate-resilient agriculture related to zero carbon emission farming to produce residue/carbon-free food for exports.

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18th April 2022: Union Agriculture Minister launches integrated and hi-tech online portals on export/import of agricultural commodities and pesticides registration

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6th April 2022: Department of Animal Husbandry and Dairying launches ‘One Health’ pilot project in Uttarakhand

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8th February 2022: Jawaharlal Nehru Krishi Vishwavidyalaya (JNKVV) has developed two varieties each of oats and wheat, one of rice and three of niger.

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  • In the Food Processing Sector, the number of registered units/ factories is 37,839 and investment in fixed capital is USD 28.17 Bn. 10
  • The Food Processing Industry in India stands as one of the major employment-intensive industries, constituting 13.75% of the employment in all manufacturing factories registered under the Factories Act 1948. The total number of persons engaged in the food processing sector is 17,72,259. 10
  • The agricultural exports have grown by 19.92 percent during 2021-22 to touch USD 50.21 bn over and above the growth of 17.66 percent at USD 41.87 bn achieved in 2020-21 and has been achieved in spite of unprecedented logistical challenges in the form of high freight rates, container shortages, etc.
  • With an annual production of more than 2.2 mn MT, the apple from J&K contributes to 87% of the national production and is linked to the livelihood of about 30% of the population of Jammu and Kashmir.
  • IMAC approves seven proposals with total project cost of Rs. 216.489 Cr. including grants-in-aid of INR 52.767 crore in the States/UTs of Chhattisgarh, Andhra Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and Tamil Nadu. These projects will leverage private investment of INR 163.722 crore and are expected to generate employment to 12,400 persons & benefit 28,000 farmers.
  • The production of honey in the country has increased from 76,150 metric tonnes in 2013-14 to 1.25 lakh metric tonnes in 2020-21. At the same time, the export of honey has increased from 28 thousand metric tons in  2013-14 to about 60 thousand metric tons in 2020-21.
  • Cotton production is estimated at 362.18 lakh bales. The cotton season 2021-22 commenced with an estimated carry over stock of 73.20 lakh bales.
  • Dairy products grew over by 96 percent standing at USD 634 mn in 2021-22 from USD 323 mn in 2020-21.
  • Exports of Coffee values at  USD 113.90 mn in April 2022 and records positive growth vis-à-vis April 2021 of 59.38%. 
  • Exports of Tea values at  USD 49.22 mn in April 2022.
  • Exports of Other cereals values at  USD 90 mn in April 2022 and records positive growth vis-à-vis April 2021 of 60.83%. 
  • Exports of Cereal preparations & miscellaneous processed items values at  USD 229.58 mn in April 2022 and records positive growth vis-à-vis April 2021 of 38.82%. 
  • Exports of Oil seeds values at  USD 115.52 mn in April 2022 and records positive growth vis-à-vis April 2021 of 19.74%. 
  • Exports of Oil Meals values at  USD 101.64 mn in April 2022.
  • Export of poultry products rose to USD 71 mn in 2021-22 from USD 58 mn in the previous year and sheep/goat meat export is up by 34 percent at USD 60 mn in 2021-22 from USD 44 mn in the previous year.
  • Exports of Fruits & Vegetables values at  USD 285.03 mn in April 2022 and records positive growth vis-à-vis April 2021 of 10.58%. 
  • Exports of Spices values at  USD 319.32 mn in April 2022.
  • Among the major spices, Cumin (14.8%), Garlic (14.7%), Ginger (7.5%), Fennel (6.8%), Coriander (6.2%), fenugreek (5.8%), Red chilli (4.2%) and Turmeric (1.3 %), show significant growth rate in production.
  • A total of 110 food processing projects were completed / operationalized viz; Mega Food Park:1, Cold Chain:37, Unit:68, Food Testing Labs:4.
  • Export of pulses reported a growth of 34 percent touching USD 358 mn in 2021-22 from USD 265 mn in 2020-21.
  • India’s agri-exports of principal agri commodities group was INR 2,52,297 crore which was 1.2% of Gross Domestic Product (GDP) at current prices. Despite covid-19 pandemic, there has been 22.8% growth in agri exports at INR 3, 09,939 crore with a share of 1.6% to GDP during 2020-21.
  • The Agriculture sector contributes a significant share of around 21% to the overall Gross Domestic Product (GDP). With total exports of agricultural and allied products at USD 41.25 bn in FY21, India is among the 15 leading exporters of agricultural products in the world.
  • India's major exporting destination of fresh fruits during 2020-21 were Bangladesh (USD126.6 mn), Netherland (USD 117.56 mn), UAE (USD 100.68 mn), UK (USD 44.37mn), Nepal (USD 33.15mn), Iran (USD 32.54 mn), Russia (USD 32.32 mn), Saudi Arabia (USD 24.79 mn), Oman (USD 22.31 mn) and Qatar (USD 16.58 mn). Top ten countries accounted for 82 percent in India's export of fresh fruits in 2020-21. 
  • Export of rice was the top forex earner at USD 9654 mn during 2021-22, growing 9.35 percent from previous year when it touched USD 8829 mn.
  • Exports of Rice values at  USD 810.66 mn in April 2022.
  • Rice shares 2.01% of the total exports of the country in the month of April.
  • Exports of  Rice values at  USD 9625.50 mn from Apr21- Mar22 and records positive growth vis-à-vis Apr20-Mar21 of 9.02%. 
  • Rice shares 2.30% of the total exports of the country in the period Apr21- Mar22.
  • Exports of Meat, dairy & poultry products values at  USD 383.96 mn in April 2022 and records positive growth vis-à-vis April 2021 of 11.19%. 
  • Exports of Marine Products values at  USD 634.28 mn in April 2022 and records positive growth vis-à-vis April 2021 of 15.31%. 
  • Frozen shrimps constitute the major share in India’s Marine Products exports items with 74% share in value terms (USD); Frozen Fish (7%), Others (6%) and Frozen Squid (5%) constitute the other major items in the Marine Products exports basket in FY2020-21. 
  • India’s maize exports at an all-time high of USD 816.31 mn in the first ten months of current fiscal, surpassing the USD 634.85 mn achieved during the last FY.
  • Bangladesh has imported maize worth USD 345.5 mn in the current fiscal (April-January), while Nepal has imported maize worth USD 132.16 mn and Vietnam has imported maize worth USD 244.24 mn to during this period. Other prominent importing countries are Malaysia, Myanmar, Sri Lanka, Bhutan, Taiwan, Oman, etc.
  •  India’s agricultural and processed food products exports touched USD 21.5 bn in Apr–Feb 2021-22; all set to achieve annual target of USD 23.71 bn in current fiscal.
  • Sugar export valued at USD 4600 mn in 2021-22, growing at 65 percent in 2021-22 corresponding to previous year. 
  • Exports of other processed food items grew by 34 percent during 2021-22 to touch USD 1164 mn against USD 866 mn in 2020-21. 
  • The cashew exports also grew by 7 percent to USD 452 mn in 2021-22 from USD 420 mn in the previous year. 
  • Exports of Cashew values at  USD 32.76 mn in April 2022.
  • Floriculture products reported a rise of 33 percent when it touched USD 103 mn in 2021-22 from USD 77 mn in 2020-21.
  • The Average Index of Industrial Production of Manufacture of food products in the FY 2021-22 is 127.4 and has grown by 5.8 percent.
Growth Drivers
  • Union Minister Shri Hardeep Puri has stated that the budget of the Department of Agriculture & Farmers’ Welfare has gone up more than six times in the past six years. This sector employs nearly 42 per cent of our total population and contributes 16 per cent to the GDP while experiencing a year-on-year growth rate of 2 per cent.38
  • Under the Ministry of Food Processing Industries, 284 State-wise proposals approved under the Scheme of Creation / Expansion of Food Processing & Preservation Capacities (CEFPPC) of Pradhan Mantri Kisan Sampada Yojana (PMKSY).
  • Sector Policy Scheme for extending financial assistance to project proponents for enhancement of their ethanol distillation capacity.
  • Ministry in pursuance of sub-clause (c) of clause 22 of the Fertilizer (Inorganic, organic or mixed) (Control) Order, authorizes the manufacturers of City Compost to sell City Compost in bulk directly to farmers.42
  • To boost the agricultural economy, to reduce dependence on imported fossil fuel, to save foreign exchange on account of crude oil import bill & to reduce the air pollution, the Government has fixed a target of 10% blending of fuel-grade ethanol with petrol by 2022 & 20% blending by 2025.
  • One Health Support Unit is established in the Department of Animal Husbandry and Dairying under the One Health framework to tackle the challenges of zoonotic diseases and Antimicrobial resistance.
  • The Government has approved a pilot project for Hybrid seed mini kits distribution of Mustard through National Seeds Corporation (NSC) during Rabi-2021-22 under National Food Security Mission-Oilseeds (NFSM-OS). Hybrid Mustard seed mini-kits have been distributed to major Mustard growing States, such as Rajasthan, Madhya Pradesh, Uttar Pradesh, Haryana and Gujarat.
  • Sub-Mission on Agroforestry Scheme is being implemented to encourage tree plantation on farm land in a complementary and integrated manner with crops and livestock, to help the farmers to get additional income and make their farming systems more climate resilient and adaptive.
  • GOI plans to migrate towards technology based yield estimation from the conventional Crop Cutting Experiment (CCE) based yield estimation approach. Towards this, few pilot studies have been initiated by taking various Government and Private Agencies On-board. 
  • GOI has set a target of exports worth USD 43 bn  for agricultural products in 2021-22 to boost India’s foreign exchange earnings, double farmers income as well as boost employment opportunities in the country.
  • GOI has finalized an India Digital Ecosystem of Agriculture (IDEA) framework which would lay down the architecture for the federated farmers’ database and linking them with the digitized land records. 
  • A Farmer Connect Portal has been set up for providing a platform for farmers, Farmer-Producer Organizations (FPOs) and cooperatives to interact with exporters. Buyer-Seller Meets (BSMs) have been organized in the clusters to provide export-market linkages. Regular interactions, through video-conferences, have been held with the Indian Missions abroad to assess and exploit export opportunities. 
  • Various research activities are implemented through 103 ICAR Research Institutes, 63 State Agricultural Universities, 3 Central Agricultural Universities, 11 Agricultural Technology Application Research Institute (ATARI) and 727 Krishi Vigyan Kendras established in the country to increase agricultural production and minimize the losses in agricultural productivity.
  • During the year 2021-22 the Government has allocated an amount of INR 8513.63 crores (BE) for undertaking agricultural research work.
  • GOI is implementing the National Mission for Sustainable Agriculture (NMSA) to minimize the carbon footprint of agricultural activities. NMSA includes programmatic interventions like Soil Health Card (SHC), Paramparagat Krishi Vikas Yojana (PKVY), Mission Organic Value Chain Development for North Eastern Region (MOVCDNER), Rainfed Area Development (RAD), National Bamboo Mission (NBM),  Sub-mission on Agro Forestry (SMAF) and Prime Minister Krishi Sinchayee Yojana (PMKSY).
  • GOI has launched the Central Sector Scheme of “Formation and Promotion of 10,000 Farmer Producer Organisations (FPOs)” to form and promote 10,000 new FPOs which will leverage economies of scale, reduction of cost of production and enhancing farmers’ incomes thus playing a major role towards doubling the income of farmers.
  • The MSP for Fair Average Quality (FAQ) of milling copra has been increased to INR 10,590/- per quintal for 2022 season from INR 10,335/- per quintal in 2021 and the MSP for ball copra has been increased to INR 11,000/- per quintal for 2022 season from INR 10,600/- per quintal in 2021.
  • The ‘Banas Dairy Sankul’, set up at the UP State Industrial Development Authority Food Park, Karkhiyaon, Varanasi is spread across 30 acres of land. The Dairy will be built at a cost of about INR 475 crores and will have a facility for processing 5 lakh litre of milk per day.
  • GOI aims to bring 28-lakh hectares of land under cultivation to make India Aatmanirbhar in edible oil.
  • The Centre has signed MoU with nine state governments for Viability Gap Payment, finalized revised Annual Action Plans of 11 states incorporating new provisions of Mission and organized National Workshop on Oil Palm.
  • Telangana has notified 26 districts for oil palm cultivation and 11 oil processors are operating in the state. The targets of 5 lakh hectares’ plantation have been set for year 2022-23.
  • Coffee Board has initiated a programme with the Government of Odisha to promote coffee and black pepper cultivation by tribals in Koraput District. This four-year programme, designed to be implemented with financial assistance from the Government of Odisha and technical assistance from the Coffee Board, has a budget of INR 16.46 crore and envisages support to about 4100 tribal growers to produce coffee and black pepper in an area of about 2000 ha (existing and new).
  • GOI approves a project for supporting the development of new rubber plantations in North East and improving quality of processed forms of rubber with a contribution of INR 1,100 crore from major tyre companies, represented by Automotive Tyre Manufacturers Association (ATMA).
  • The Ministry of Food Processing Industries has signed an agreement with NAFED for developing 10 brands of selected ODOPs under the branding and marketing component of the PMFME scheme. Out of these, six brands namely Amrit Phal, Cori Gold, Kashmiri Mantra, Madhu Mantra, Somdana, and Whole Wheat Cookies of Dilli Bakes were launched.
  • APEDA has identified potential districts of Uttar Pradesh to be covered under the Varanasi Agri – Export Hub (VAEH). GOI aims at making the landlocked Purvanchal region as a new destination of agri-export activities which covers districts of Varanasi, Mirzapur, Azamgarh, Prayagraj, Gorakhpur, Basti, Ghazipur, Jaunpur, Chandauli and Sant Ravidas Nagar.
  • National Institute of Food Technology Entrepreneurship and Management (NIFTEM) Act 2021 was passed by Parliament in 2021 to declare NIFTEM and IIFPT as Institutions of National Importance (INI).
  • Cabinet approves implementation of Pradhan Mantri Krishi Sinchayee Yojana for 2021-26.
  • Agriculture Minister releases Standard Operating Procedure (SOP) for use of Drone in Pesticide Application for Crop Protection and for spraying Soil and Crop Nutrients.
  • In a major boost to promote precision farming in India, GOI has issued guidelines to make drone technology affordable to the stakeholders of this sector. 
  • The guidelines of “Sub-Mission on Agricultural Mechanization” (SMAM) have been amended which envisages granting upto 100% of the cost of agriculture drone or INR 10 lakhs, whichever is less, as a grant for purchase of drones by the Farm Machinery Training & Testing Institutes, ICAR institutes, Krishi Vigyan Kendras and State Agriculture Universities for taking up large scale demonstrations of this technology on the farmers’ fields.
  • For promoting use of Kisan Drones, the government is providing 50% or maximum INR 5 lakh subsidy to SC-ST, small and marginal, women and farmers of northeastern states to buy drones. For other farmers, financial assistance will be given upto 40 percent or maximum INR 4 lakh.
  • National Beekeeping & Honey Mission (NBHM) aims to create a network of honey testing labs covering all parts of the country.
  • NAFED is creating 65 clusters/ Farmers Producers Organisations (FPOs) of beekeepers/ Honey Processors. These 65 FPOs will be part of the honey corridor linking northwest to north-eastern regions. 
  • India and UK Launch Free Trade Agreement Negotiations to give major fillip to Indian exports in labor intensive sectors like Leather, Textile, Jewellery and processed Agri-products.
  • ICAR/Department of Agricultural Research and Education (DARE) has developed a clear roadmap for next 10 years harnessing the power of science and innovation for securing food and nutritional security of our people, farmers’ prosperity and to enhance natural resource base to promote inclusive growth and sustainable development of Indian agriculture sector. 
  • The focused areas of research and development include;  Genetic enhancement of plants/animals/fish for higher productivity under increased intensity of biotic and abiotic stresses, productivity enhancement through sustainable intensification, and mechanization of agriculture and food system, enhancing value, safety and income through food processing, development of energy efficient technologies and farming practices, education and human-resource development & developing and promoting innovations in technology transfer systems.
  • The 'Mission for Integrated Development of Horticulture (MIDH)', a Centrally Sponsored Scheme is under implementation in all States/UTs for holistic growth of the horticulture sector covering fruits, vegetables, root and tuber crops, mushrooms, spices, flowers, aromatic plants, coconut, cashew, cocoa and bamboo.
  • Physical infrastructure/ facilities under Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) have been developed in 1351 village haats and is under development in 1632 number of village haats.
  • India is placed among the top 10 Agri products exporting countries. GOI aims to put India in the top 5 countries in the field of Agri product export.
  • The scheme 'Mass Media Support to Agriculture Extension of 'Sub-Mission on Agriculture Extension' is under implementation to create awareness among the farming community and educate the farmers on improved agriculture technologies. 
  • A Centrally Sponsored Scheme on ‘Support to State Extension Programmes for Extension Reforms’ popularly known as 'Agriculture Technology Management Agency (ATMA)' is under implementation in 691 districts of 28 States & 5 UTs of the country. The extension activities under ATMA, inter-alia, include Farmers’ Training to upgrade their knowledge and technical skills on modern and innovative agricultural technologies.
  • Ten thousand new FPOs are being built in the country at an expense of INR 6,865 crore. 
  • The Department of Animal Husbandry & Dairying (DAHD), GOI has launched a pilot project in  Uttarakhand to implement the One Health Framework by One Health Support Unit to improve livestock health, human health, wildlife health, and environmental health through technology and finance.
  • APEDA inks MoU with National Research Development Corporation (NRDC) to focus on climate-resilient agriculture related to zero carbon emission farming to produce residue/carbon-free food for exports.
  •  India & Germany signs a joint declaration on agro-ecology and sustainable management of natural resources. Through this, joint research, knowledge sharing and innovation will be promoted between academic institutions of both countries and practitioners including farmers.
  • The Ministry of Food Processing Industries has signed an agreement with NAFED for developing 10 brands of selected 20 ODOPs under the branding and marketing component of the PMFME scheme.
  • 7 ODOP Brands and 9 Products that have been successfully launched in collaboration with NAFED includes - Brand : Cori Gold; District/State: Kota, Rajasthan Product : Coriander Powder, Brand - Makhana King ; District/State: Darbhanga and Muzaffarpur from Bihar, Product: Plain and Chatpata Makhana), Brand - Dilli Bakes ( District/State: Delhi, Product: Cookies and Rusk), Brand  - Amrit Phal ( District/State: Gurgaon, Haryana Product: Amla Juice), Brand  - Madhumantra ( District/State: Saharanpur, Uttar Pradesh, Product: Multiflora Honey), Brand  - Somdana ( District/State: Thane, Maharashtra, Product: Millet Flour) and Brand  - Kashmiri Mantra ( District/State: Kulgam, Jammu and Kashmir Product: Red Chilli Powder). 
  • Government announces some relaxation in wheat export to ensure India’s food security and check inflation, to helps other countries facing food deficit, and maintains India’s reliability as a supplier.
FDI Policy
  • 100% FDI is permitted under the automatic route in the Food and Processing industry in India. 12
  • 100% FDI is allowed through the government approval route for trading, including through e-commerce in respect of food products manufactured or produced in India. 12
  • The cumulative FDI equity inflow in the Food Processing industry is USD 10,945.62  mn during the period from April 2000 to December 2021. This constitutes 1.91% of the total FDI inflow received across sectors.26
  • The cumulative FDI equity inflow in Agricultural Services is USD 2,470.60 mn during the period April 2000 to December 2021. 
  • The cumulative FDI equity inflow in Vegetable Oil & Vanaspati is USD 1,029.64 mn during the period April 2000 to December 2021. 
  • The cumulative FDI equity inflow in Sugar is USD  239.39 mn during the period April 2000 to December 2021. 
  • The cumulative FDI equity inflow in Tea and Coffee (Processing & Warehousing Coffee & Rubber) is USD  163.35 mn during the period April 2000 to December 2021. 
  • The cumulative FDI equity inflow in Agricultural Machinery is USD 733.38  mn during the period April 2000 to December 2021. 


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Production Linked Incentive (PLI) Scheme

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has given its approval to introduce the Production-Linked Incentive (PLI) Scheme in Food Products for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat.

Financial Outlay- INR 10,900 crore

Products: Ready to Eat / Ready to Cook (RTE/ RTC), Marine Products, Fruits & Vegetables, Honey, Desi Ghee, Mozzarella Cheese, Organic eggs and poultry meat

For more details on PLI Schemes, Click Here

Sector Policy
  • Food Processing is recognized as a Special Focus Sector in the National Manufacturing Policy. 13
  • Under Mission Organic Value Chain Development in North East Region (MOVCDNER), Farmers are provided subsidy of INR 31000/ ha / 3 years under PKVY and INR 32500/ ha/ 3 years under MOVCDNER for various organic inputs including organic fertilisers.
  • Under National Food Security Mission (NFSM), financial assistance is provided for promotion of Bio-Fertilizer (Rhizobium/ PSB) @50% of the cost limited to Rs.300 per ha.
  • The Government is implementing Agricultural Marketing Infrastructure (AMI), a sub-scheme of Integrated Scheme for Agricultural Marketing (ISAM) under which assistance is provided for construction/ renovation of godowns/ warehouses in the rural areas in the States to enhance the storage capacity for agriculture produce. Under the scheme, Government provides subsidy at the rate of 25% and 33.33% on capital cost of the project based on the category of eligible beneficiary. Assistance is available to Individuals, Farmers, Group of farmers/growers, Agri-preneurs, Registered Farmer Produce Organizations (FPOs), Cooperatives, and state agencies etc. The scheme is demand driven.
  • Food and agro-based processing units can avail loans under Priority Sector Lending. 14 It will ensure a greater flow of credit to entrepreneurs for setting up food processing units and attract investment in the industry.
  • Government has set up a special fund called "Food Processing Fund" of approximately USD 265 Mn in National Bank for Agriculture and Rural Development (NABARD) for extending affordable credit to designated food parks and the individual food processing units in the designated food parks. 15
  • Government has  introduced a Central Sector Scheme –‘Transport and Marketing Assistance for Specified Agriculture Products’ – for providing assistance for the international component of freight to mitigate the freight disadvantage for the export of agriculture products.
  • Ministry of Food Processing Industries is also keen on developing an integrated and comprehensive National Food Processing Policy, for which a draft has already been circulated among the stakeholders to receive suggestions and recommendations. 16 It aims to build India’s National Food Grid and National Cold Chain Grid apart from the retail markets at every nook and corner of the country.
  • Ministry of Food Processing Industries (MoFPI) provides a host of financial assistance to food processing companies in India, under the umbrella scheme of Pradhan Mantri Kisan Sampada Yojna (PMKSY). The following schemes are included under PMKSY: 17
    • Mega Food Parks
    • Integrated Cold Chain and Value Addition Infrastructure
    • Creation/ Expansion of Food Processing/ Preservation Capacities (Unit Scheme)
    • Infrastructure for Agro-processing Clusters
    • Creation of Backward and Forward Linkages
    • Food Safety and Quality Assurance Infrastructure
    • Human Resources and Institutions
    • Operation Greens
  • The Union Cabinet of India has announced a new central sector scheme of Agriculture Infrastructure Fund. Under the scheme, INR 1 lakh cr will be provided by banks and financial institutions to feasible projects for post-harvest management infrastructure and community farming assets. The financial support will be in the form of medium - long term debt financing facility and all loans under this financing facility will have interest subvention of 3% per annum up to a limit of INR 2 cr. 18
  • The Cabinet Committee on Economic Affairs of the Government of India has approved the setting up of Animal Husbandry Infrastructure Development Fund (AHIDF). AHIDF will incentivize investments in infrastructure for dairy and meat processing and value addition infrastructure and establishment of animal feed plant in the private sector. Farmer Producer Organizations (FPOs), MSMEs, Section 8 companies, private companies and individual entrepreneurs with a minimum 10% margin money will be the eligible beneficiaries of the scheme. The remaining 90% would be the loan component which will be provided by scheduled banks. A total amount of INR 15000 cr. has been approved for the Animal Husbandry Infrastructure Development Fund (AHIDF). 21

Animal Husbandry Infrastructure Development Fund (AHIDF): 21

  • The Cabinet Committee on Economic Affairs of the Government of India has approved the setting up of Animal Husbandry Infrastructure Development Fund (AHIDF). AHIDF will incentivize investments in infrastructure for dairy and meat processing and value addition infrastructure and establishment of animal feed plant in the private sector. 
  • Farmer Producer Organizations (FPOs), MSMEs, Section 8 companies, private companies and individual entrepreneurs with a minimum 10% margin money will be the eligible beneficiaries of the scheme. The remaining 90% would be the loan component which will be provided by scheduled banks.
  • A total amount of INR 15000 cr. has been approved for the Animal Husbandry Infrastructure Development Fund (AHIDF).

The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 27

  • This act creates an ecosystem where the farmers and traders enjoy the freedom of choice relating to the sale and purchase of farmers’ produce.
  • This act facilitates remunerative prices through competitive alternative trading channels.
  • The main aim of this act is to promote efficient, transparent and barrier-free inter-State and intra-State trade and commerce of farmers’ products
  • In order to support section 17 of the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Rules, 2020 came into force on 22 October 2020.28

Operation Green (Top to Total)

  • Ministry of Food Processing Industries (MoFPI) as a part of Aatmanirbhar Bharat Abhiyan extended the Operation Greens Scheme from Tomato, Onion and Potato (TOP) to all fruits & vegetables (TOTAL) for a period of six months on a pilot basis. The objective of the intervention is to protect the growers of fruits and vegetables from making distress sales.29
  • In a Budget speech for 2021-2022, Government has announced the expansion of the scope of “Operation Greens scheme” from Tomato, Onion & Potato (TOP) to 22 perishable products, so as to boost value addition in agriculture and allied products and their exports.
  • 6th Amended Scheme Guideline for Short term Intervention under Operation Greens TOP to TOTAL.35
  • Subsidy for transportation of all fruits & vegetables via any type of train service by Indian Railway under Operation Greens - TOP to TOTAL 

PM Kisan Samman Nidhi41

  • Hon'ble PM, Shri Narendra Modi released the 7th instalment of financial benefit under PM Kisan Samman Nidhi to establish Indian agricultural markets in the world.37
  • More than 1,10,000 cr rupees have been released so far and 10.59 cr farmer families have been benefitted.
  • Under the PM-KISAN Scheme more than 1.60 lakh crore rupees have been transferred to more than 11.54 crore Farmers till December (2021)
  • As on 9th December 2021, the database of farmers registered under PM-KISAN includes 11.64 Crores farmers.
  • GOI is in the process for creating unique ID of farmers of the country. The unique identifier of the farmer will link the farmer profile with all the agricultural schemes which would eliminate the need of re-submitting physical documents to different departments for availing benefit(s) under different schemes.

Crop Insurance Scheme

  • The Pradhan Mantri Fasal Bima Yojana (PMFBY) successfully completes 5 Years of operations on 13th January 2021. The Scheme benefits farmers who face crop losses due to various reasons.

Micro Irrigation Fund

  • Micro Irrigation Fund with a corpus of INR 5,000 cr was created with NABARD during 2018-19 with an objective to facilitate the States in mobilizing the resources and to provide top-up/additional incentives to farmers for incentivising micro-irrigation beyond the provisions available under PMKSY-PDMC.

Pradhan Mantri Kisan Maan Dhan Yojana46

  • Pradhan Mantri Kisan Maan Dhan Yojna (PMKMY) Scheme aims to provide a social security net for the Small and Marginal Farmers (SMF) by way of pension, as they have minimal or no savings to sustain their livelihood during their old age and to support them in the event of the consequent loss of livelihood.
  • 21,42,718 Farmers have been enrolled under Pradhan Mantri Kisan Maandhan Yojana (PM-KMDY).

Pradhan Mantri Kisan Sampada Yojana (PMKSY)

  • The overall growth and development of food processing sector, mostly through private sector participation.
  • Under the component schemes, MoFPI provides credit linked financial assistance (capital subsidy) in the form of grants-in-aid to entrepreneurs for setting up of food processing / preservation industries with farm level infrastructure like primary processing facilities, collection centers etc.
  • Till July 2021, 792 projects out of a total of 818 projects have been approved for setting up food processing Industries by the private sector with approved Grants in Aid of INR 5,791.71 crore.

Dairy processing and Infrastructure Development Fund (DIDF)

  • DIDF is a programme wherein assistance at subsidised rate of interest (Interest Subvention) will be given. The project focuses on building an efficient milk procurement system by setting up of processing and chilling infrastructure & installation of electronic milk adulteration testing equipment at village level.

National Edible Oil Mission- Oil Palm

  • National Mission on Edible Oils - Oil Palm (NMEO-OP) has been launched with the aim to augment the availability of edible oil in the country by harnessing area expansion, increasing crude palm oil production with the aim to reduce the import burden.
  • The salient features of NMEO-Oil palm include assistance for planting material, inputs for intercropping upto gestation period of 4 years and for maintenance, establishment of seed gardens, nurseries, micro irrigation, bore well/pumpset/water harvesting structure, vermi compost units, solar pumps, harvesting tools, custom hiring centre cum harvester Groups, farmers and officers training, and for replanting of old oil palm gardens etc.
  • The total approved cost of the NMEO (Oil Palm) Scheme is INR 11,040 crore. For the year 2021-22, a total of INR 10422.69 lakh has been approved for various state annual action plans.

National Agriculture Market (e-NAM) Scheme

  • GOI had launched National Agriculture Market (e-NAM) Scheme with the objective of creating online transparent competitive bidding system to facilitate farmers with remunerative prices fotheirheir produce.
  • Under the e-NAM Scheme, Government is providing free software and assistance of INR 75.00 Lakh per mandi for related hardware including quality assaying equipments and creation of infrastructure like cleaning, grading, sorting, packaging and compost unit etc.
  • 1000 mandis of 18 States and 3 UTs have been integrated with e-NAM platform till November 2021.

Schemes on Paramparagat Krishi Vikas Yojana (PKVY) 

  • Farmers are primarily encouraged for organic cultivation using organic fertilizers and provided hands-on training about on-farm production of organic fertilizers and its use. 
  • Organic cultivation on either side of River Ganga, large area certification and support for individual farmers has also been introduced under PKVY to increase coverage using organic fertilizers.

Bhartiya Prakritik Krishi Padhati (BPKP)

  • The scheme has been introduced as a sub-scheme of PKVY for the promotion of traditional indigenous practices including Zero Budget Natural Farming (ZBNF).
  • The scheme mainly emphasizes on exclusion of all synthetic chemical inputs and promotes on-farm biomass recycling with major stress on biomass mulching, use of cow dung-urine formulations and plant based preparations.
  • Under BPKP, financial assistance of INR 12200/ha for 3 years is provided for cluster formation, capacity building and continuous handholding by trained personnel, certification and residue analysis.
  • Until now, under natural farming an area of 4.09 lakh ha area has been covered and a total fund of INR 4980.99 lakh has been released in 8 States across the country.

National Mission on Oilseeds and Oil Palm (NMOOP)

  • Financial assistance@ 50% subsidy to the tune of Rs. 300/- per ha is being provided for different components including bio-fertilizers, supply of Rhizobium culture/Phosphate Solubilising Bacteria (PSB)/ Zinc Solubilising Bacteria(ZSB)/ Azatobacter/ Mycorrhiza and vermi compost.

The SOP for drone regulation for pesticide application

  • It covers important aspects like statutory provisions, flying permissions, area distance restrictions, weight classification, overcrowded areas restriction, drone registration, safety insurance, piloting certification, operation plan, air flight zones, weather conditions, SOPs for pre, post and during operation, emergency handling plan.

Conformity Assessment Scheme

  • PM launches a Portal and Logo dedicated to the Conformity Assessment Scheme of milk products to ensure Quality & Food safety of Milk and Milk products across the country.

The Scheme focuses on: 

  • Simplify the certification process
  • Create an instantly recognisable logo for public to be reassured about dairy product quality
  • Increase the sales of milk and milk products in organized sector and in turn enhancing income of farmers
  • Develop a quality culture in the dairy sector

Pradhan Mantri Matsya Sampada Yojana (PMMSY)

  • With a budget of INR 20,050 crore, it is by far the largest investment to bring about Blue Revolution through sustainable and responsible development of the fisheries sector in India.

  • PMMSY, is implemented over a period of 5 years from FY 2020-21 to FY 2024-25 in all States/Union Territories and has set a target of INR 1,00,000 crore fisheries export, additional 70 lakh tonnes fish production, and generation of 55 lakh employment in the years to come.

National Food Security Mission (NFSM)

  • The Department of Agriculture and Farmers Welfare (DA&FW) is implementing a Sub-Mission on Nutri-Cereals (Millets) to enhance area, production & productivity of millets including bajra.
  • Under this Sub-Mission, bajra is being promoted in 89 districts of 9 states including 14 districts of Gujarat. North Eastern States, Himachal Pradesh and UTs of Jammu & Kashmir and Ladakh have been given flexibility to include the districts under programme.
  • Through the efforts made by the Government, the production of millets has increased from 14.52 million tonnes in 2015-16 to 17.96 million tonnes in 2020-21.
  • The production of bajra has also increased from 8.07 million tonnes to 10.86 million tonnes during the same period.
Financial Support

Union Budget 2022-23

  • The total budgetary allocation for FY 2022-23 towards the  Ministry of Food Processing Industries is INR  2941.99 cr.
  • The total budgetary allocation for FY 2022-23 towards the Department of Agriculture and Farmers Welfare is INR 1,24,000 cr.
  • The total budgetary allocation for FY 2022-23 towards the Department of Agricultural Research and Education is INR  8,513.62  cr.
  • The total budgetary allocation for FY 2022-23 towards the Department of Food and Public Distribution is INR 2,15,959.58 cr.
  • The total budgetary allocation for FY 2022-23 towards the Department of Fisheries is INR 2,118.47 cr.
  • The total budgetary allocation for FY 2022-23 towards the Department of Animal Husbandry and Dairying is INR 3,918.84 cr.
  • Budget 2022 endeavours to create level playing field for domestic tractor and also paves way for capacity creation in tractor manufacturing

Agriculture Infrastructure Fund (AIF)40

  • Agriculture Infrastructure Fund (AIF) was launched on 9th August 2020. The aim of the fund is to provide medium to long term debt financing for investment in viable projects for post-harvest management Infrastructure and community farming assets through interest subvention and financial support. 
  • The scheme shall be in effect for 10 years i.e. from FY 2020 to FY 2029.
  • A total of 8702 Projects of Primary Agricultural Credit Societies are sanctioned under the Agriculture Infrastructure Fund (AIF) with a loan amount of INR 6254 Crores.

Highlights of 2020-21 (Third Advance Estimates) 44     

  • Total Horticulture production in 2020-21 is estimated to a record 331.05 mn Tonne, which is an increase of about 10.6 mn Tonne (3.3%) over that achieved in 2019-20.
  • Production of Fruits is estimated to be 103.0 mn Tonne, compared to 102.1 mn Tonne achieved in 2019-20.
  • Production of Vegetables is estimated to be 197.2 mn Tonne compared to last year’s production of 188.3 mn Tonne that is, an increase of 4.8%.
  • Production of Onion is reported to be 26.8 mn Tonne as against 26.1 mn Tonne achieved in 2019-20.
  • Production of Potato is estimated to a record production of 54.2 mn Tonne in 2020-21, an increase by 5.6 mn Tonne compared to 2019-20.
  • Production of Tomato is reported to be 21.1 mn Tonne, as against production of 20.6 mn Tonne achieved in 2019-20.
  • Production of Plantation Crops has increased from 16.1 mn Tonne in 2019-20 to 16.6 mn Tonne in 2020-21.
  • Production of Spices has increased by 5.3%, from 10.1mn Tonne in 2019-20 to 10.7 mn Tonne in 2020-21.

Production-Linked Incentive (PLI) Scheme47

  • PLI Scheme for Food Processing Industry was approved by the Cabinet on 31.3.2021 for implementation during 2021-22 to 2026-27 with an outlay of INR 10,900 cr.
  • Products - Ready to Eat / Ready to Cook (RTE/ RTC) Marine Products Fruits & Vegetables Mozzarella Cheese Innovative & Organic Food Products including free-range poultry egg & meat
  • The scheme is meant for Indian companies and subsidiaries of MNCs operating in India with minimum sales of food products manufactured in India.
  • The objective of the scheme is to support the creation of global food manufacturing champions; support Indian brands of value-added food products in the international markets; increase employment opportunities for off-farm jobs and ensuring remunerative prices of farm produce and higher income to farmers.
  • Under PLI Scheme for Food Processing Industries issued an EOI from prospective beneficiaries and total of 165 applicants registered and activated for submission of application.
  • No company will get more than 25% of the total budget for the segment and no company will get less than 5% of the segment outlay.48
Investment Opportunities


  • Fruits and vegetables: preserved, candied, glazed and crystallized fruits and vegetables, juices, jams, jellies, purees, soups, powders, dehydrated vegetables, flakes, shreds and ready-to-eat curries.
  • Food preservation by fermentation: wine, beer, vinegar, yeast preparation, alcoholic beverages. Beverages: fruit-based, cereal-based.
  • Dairy: liquid milk, curd, flavored yogurt, processed cheese, cottage cheese, Swiss cheese, blue cheese, ice cream, milk-based sweets.
  • Food additives and nutraceuticals.
  • Confectionery and bakery: cookies and crackers, biscuits, bread, cakes and frozen dough.
  • Meat and poultry: eggs, egg powder, cut meats, sausages and other value-added products. Fish, seafood and fish processing – processing and freezing units.
  • Grain processing – oil milling sector, rice, pulse milling and flour milling sectors.
  • Food preservation and packaging: metal cans, aseptic packs.
  • Food processing equipment: canning, dairy and food processing, specialty processing, packaging, frozen food/refrigeration and thermo-processing.
  • Consumer food: packaged food, aerated soft drinks and packaged drinking water. Spice pastes.
  • Supply chain infrastructure – this niche has investment potential in food processing infrastructure, the government’s focus is on supply chain related infrastructures like cold storage, abattoirs and food parks.
  • The establishment of food parks – a unique opportunity for entrepreneurs, including foreign investors to enter in the Food Processing industry in India.
  • One District One Focus Product (ODOFP) programme cover products of agriculture and allied sectors for 728 districts of the country.


Explore projects to invest in Food Processing sector >

Foreign Investors
  • Kraft (USA)
  • Mars (USA)
  • Nestle (Switzerland)
  • McCain (Canada)
  • Danone (France)
  • Ferrero (Italy)
  • Del Monte (USA)
  • Kagome (Japan)
  • Kelloggs (USA)
  • Pepsi (USA)
  • Unilever (United Kingdom)
  • Perfetti (Italy)
  • Cargill (USA)
  • Coca Cola (USA)
  • Hershey (USA)
  • Metro Cash & Carry (Germany)
  • Walmart (US)
  • Yakult (Japan)
  • Amazon (USA)
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  6. Nivesh Bandhu, Investor Portal,
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