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Transforming The Food Economy
3-5 November, 2017 | Vigyan Bhawan, New Delhi, India

Invest to grow

Business-friendly policies, key government reforms, and fiscal incentives make India one of the world's most attractive investment destinations.

India is the largest producer of several agricultural commodities, and is ranked second in total food production, globally. The annual growth rate of the food processing sector is more than 7% and the online food delivery industry grew by 150% in 2016.

With the largest diversified production base, India offers numerous opportunities that can be capitalized along the food value chain. Expect to grow with India's flourishing economy, large workforce, strategic location, and the ease of doing business here.

Supportive Policies

Foreign Direct Investment (FDI):

  • 100% FDI through automatic route in food processing.
  • 100% FDI in food retail for food products manufactured/produced in India.

Credit:

  • Food processing units can avail preferential rates under priority sector lending.
  • A special fund of Rs.2,000 crore (US$ 300 million) with NABARD for designated food parks and processing units.

Proactive Investment Policies:

  • Attractive investment policies across various states of India.

Regulatory Reforms:

  • Food safety standards harmonized with international standards.
 

Fiscal Incentives

100% Income Tax Deductions:

  • On capital expenditure for cold chain/warehouse.
  • On profit for new food processing, preservation and packaging units.

Service Tax Exemptions:

  • On pre-conditioning, pre-cooling, ripening, waxing, retail, packing, labeling of fruits & vegetables.
  • On construction, erection, commissioning or installation of post-harvest storage infrastructure/cold storages.

Excise Duty Reductions:

  • Reduced from 10% to 6% on machinery for food processing.
  • Reduced from 12.5% to 6% on refrigerated containers.

Custom Duty Reductions:

  • Basic custom duty on refrigerated containers reduced from 10% to 5%.
  • Concessional customs duty on imported equipment for food processing.
 

Facilitating Investment

 

Sectoral Opportunities

Dairy:

India is the largest global producer of milk with a CAGR of 13-15% in the coming years.

  • Opportunity: Technology, automation, integration in the dairy segment

Fruits & Vegetables:

India is the second largest global producer of fruits & vegetables

  • Opportunity: The current processing level is less than 2%, offering immense scope for investments. Read more

Cereals & Grains:

India is the second in rice & wheat production and the largest exporter of cereal products.

  • Opportunity: Upgradation of milling technology, automation, integration, fortification.

Marine:

India is the second in fish production, worldwide.

  • Opportunity: Processing levels are low and hence there are huge opportunities in cold chain, export, packaging innovations, product differentiation. Read more

Poultry:

India is the third in egg production and fifth in meat production, globally.

  • Opportunity: Aligning with the changing consumer habits towards processed, cleaned and frozen meat and poultry products. Read more

Retail:

The share of food retail in India's total retail market is about 70% (or about US$ 380-390 Billion). It accounts for approximately 10% of GDP and 8% in total employment, and growth in retail is about 7.5%.

  • Opportunity: Development of organized retail, as food retail is largely unorganized. E-commerce is also a fast-growing segment.

Cold chain:

101 new integrated cold chain projects have been recently sanctioned by the Government of India.

  • Opportunity: This presents a huge opportunity for equipment and technology suppliers. The existing gap for reefers, pack houses, and ripening chambers are worth exploring and investing.