Friday, March 30, 2012: 10:03:10 PM

Food Processing Guest Column

Mega Food Park to benefit farmers in Gujarat - Amol Sheth, Anil Ltd

Food park to be a major step in the development of the food processing sector in India

Being chosen by the Ministry of Food Processing Industries (MoFPI), the establishment of a Mega Food Park by the Anil Group in Gujarat will be a major development in the sector.

The venture will strengthen backward and forward linkages covering the entire food processing sector’s value chain and also help implement the best practices in the agriculture and processing industry.
The presence and establishment of major players from food ingredients, processed food and food packaging industry in the Mega Food Park will generate sustainable direct and indirect employment opportunities for the people, thereby contributing towards sustainable rural development. The Mega Food Park will also integrate varied aspects of food processing and agri-business supply chain, which will lead to higher realisation for farmers by creating rural processing infrastructure, decrease in wastage, capacity building of producers & processors and creation of efficient supply chain. The Mega Food Park is expected to attract investments around Rs 1000 crore.
Currently 20-25% agro food produce in India is lost due to lack of processing facilities and inadequate infrastructure for post-harvest. Thus, the food processing sector offers massive potential for investments in the arenas of canning, dairy and food processing, specialty processing, packaging, frozen food / refrigeration and thermo processing. Anil Group aims to create a socio-economic impact by creating new income opportunities for farmers, thereby contributing towards upliftment of rural population.
The 10th plan Scheme of Food Parks was revised for the Eleventh Five-Year Plan and it was rechristened Mega Food Parks Scheme (MFPS). The scheme was approved by the government in September 2008 and envisages the following objectives:
·         Increasing the processing of perishables in the country from the existing 6% to 20%
·         Raising value addition from 20% to 35%
·         Raising the share in global food trade from 1.5% to 3% by the year 2015
Each Mega Food Park promises to benefit to 6000 farmers directly and 25,000-30,000 farmers indirectly. Each project has the potential of establishing 30-40 food processing industries.
Gujarat offers a number of competitive advantages for those planning to set up Mega Food Parks vis-à-vis other states. The state has a well developed agriculture and horticulture crop procurement system in the form of Agriculture Produce Market Committees (APMCs). Gujarat has an extensive and well developed transport system by rail, road, air and ports, which is one of the best in the country – this will facilitate bringing in goods and send out goods from the Mega Food Park of Anil Group.
The India processing scenario
The Indian food processing industry contributes close to 10% to the country’s GDP. The government is targeting an investment of more US$20 billion in the food processing sector over the next 5 years with higher participation from the private sector and financial institutions.
India ranks first in availability of milk, pulses and tea, and second in fruits, vegetables, rice and wheat. Milk products offer excellent opportunity in the country as it is the world’s largest producer. Apart from this, the relatively low-cost but skilled workforce could be utilised to set up production facilities.
The consumer market in India is huge and it is growing even further with growing incomes and changing lifestyles. This has created market opportunities for food producers, machinery makers, food technology and related service providers. Consumer purchases of milk & milk products, egg, fish, fruits and beverages are witnessing a rising trend even as the expenditure on staples such as cereals, grams and pulses is declining.
The Mega Food Parks are supposed to remove many of the problems faced by the agro and food processing sector - inadequate infrastructural facilities, lack of adequate quality control & testing methods, inadequately developed linkages between R&D labs and industry as well as seasonality of raw material.
The food processing sector will also have to be prepared to face certain threats from consumers like affordability and cultural preference for fresh food, high inventory carrying cost and high packaging cost.  
Amol Sheth is the CMD of Anil Ltd

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