Home Indian Processed Food Industry: Importance and Challenges

The Indian food processing industry is among the largest in the nation in terms of growth, production, consumption, and exports. The industry produces several food products such as meat, poultry, fisheries, fruits, vegetables, spices, milk and milk products, alcoholic beverages, plantations, and grains.

It also manufactures cocoa products and chocolates, confectionery, mineral water, soya-based items, and high-protein foods. Since the liberalisation in August 1991, the government proposed and accepted multiple projects, for instance, creating foreign collaborations, joint ventures, 100% export-oriented units, and industrial licenses to encourage growth and investment in the food processing industry. Foreign direct investment (FDI) in India has been estimated at Rs. 2,934.1 crores (US$ 368.8 million) in FY21.

India's food processing sector is a sunrise sector that has gained prominence in recent years. Major processed food products exported from India include processed fruits and juices, pulses, guar gum, groundnuts, milled products, cereals preparations, oil meals, and alcoholic beverages.

India created history in agriculture and processed food exports by exporting products worth US$ 25.6 billion in FY22. Export of APEDA products stood at US$ 7.4 billion as of April-June 2022, up 31% compared with US$ 5.7 billion over the same period last fiscal, according to the Directorate General of Commercial Intelligence and Statistics.  Furthermore, exports of processed fruits and vegetables grew by 59.1%; cereals and miscellaneous processed items grew by 37.66%; meat, dairy and poultry products grew by 9.5%; basmati rice grew by 25.5%; non-basmati rice grew by 5%; and miscellaneous products grew by 50%.

Challenges faced by the food industry

  • There exist gaps in supply chain infrastructure which means inadequate primary processing, storage, and distribution facilities
  • Insufficient connection between production and processing
  • Seasonality of operations and low-capacity utilization
  • Institutional gaps in the supply chain, for instance, there is dependence on APMC markets
  • Lack of focus on quality and safety standards, and
  • Not having enough product development and innovation

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