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FOOD PROCESSING

Investment in Food Industries

The food sector in India has successfully established its presence. India's food ecosystem offers huge opportunities for investments with stimulating growth in the food retail sector, favourable economic policies and attractive fiscal incentives. The Government of India through the Ministry of Food Processing Industries (MoFPI) is also taking all necessary steps to boost investments in the food processing industry. The government has sanctioned 42 Mega Food Parks (MFPs) to be set up in the country under the Mega Food Park Scheme. Currently, 17 Mega Food Parks have become functional.

By 2020, Indian Food and Retail market is projected to touch $828.92 bn, while the dairy industry is expected to double to $140 bn.

100% FDI in food processing sector in India is permitted under the automatic route.

100% FDI in food processing is allowed through government approval route for trading, including through e-commerce in respect of food products manufactured or produced in India.

 

 

  • 1

    World’s largest producer, consumer & exporter of spices

  • 2

    World’s largest processor, producer and consumer of cashew nuts

  • 3

    World’s 2nd largest producer of food grains, fruits, and vegetables

The Processed food market is expected to grow to $543 bn by 2020 from $322 bn in 2016, at a CAGR of 14.6%

Food processing has an important role to play in linking Indian farmers to consumers in the domestic and international markets

The Ministry of Food Processing Industries (MoFPI) is making all efforts to encourage investments across the value chain

The industry engages approximately 1.77 million people in around 39,319 registered units with fixed capital of $29.2 bn and aggregate output of around $144.6 bn

The key sub-segments of the Food Processing industry in India are: Dairy, Fruits & Vegetables, Poultry & Meat processing, Fisheries, Food retail etc.

Egg production of around 88.1 billion during 2016-17 and total fish production in 2016-17 was 11.41 million tonnes

Food Retail market is majorly dominated by Food Grocery (growing at CAGR 25%) and Food Services (growing at CAGR 15%) segments

  • Agri-commodity hub

    Largest producer of several agri-commodities
  • Huge consumer base

    1.3 bn consumers with increasing demand for branded food
  • Strong economy

    India is the fastest growing largest economy in the world
  • Conducive policies

    Proactive government policies with attractive fiscal incentives
  1. UAE keen to invest in food processingtourism and infra in HP.
  2. Dec 2018: LOTS Wholesale Solutions opens a Cash and Carry store in Delhi, second of its 15 planned distribution stores across India.
  3. Dec 2018: Union cabinet approves agricultural export policy.
  4. Dec 2018: Government plans to set up NBFC with $278.3 mn to fund food processing firms.
  5. Aug 2018: Congelados De Navarra, Spain’s leading food processing company, is all set to make an investment in food industries in India with $ 3.5 mn in Punjab, with the establishment of a food processing unit in Machiwaara, Ludhiana. The project will generate direct employment for 400 and indirect for 5,000 people in the state.
  6. Jun 2018: Amazon Retail India, the global company's food retail business in India, has received an infusion of $1.6 mn from the parent company, as per regulatory filings. Amazon has committed to invest up to $500 mn in its food retail business, for which it has kicked off a pilot in Pune.

  • $9 bn inflows from FDI in food processing industries during April 2000 – March 2019
  • $328 bn FDI equity inflows over April 2014 – March 2019
  • 22% Share in total FDI inflows

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