I. Global Scenario

Globally, the food export market is expected to bring in revenue of USD 3.03 trillion by 2020 as per research report by Research and Markets. Food and agribusiness have a massive economic and social footprint - the USD 7.8 trillion industry represents 10 per cent of global consumer spending and 40 per cent of employment. The global agro-food products industry is expected to reach USD 1,148.3 billion by 2018.

The major demand drivers for the industry include improved yield and resistance due to hybrid seeds, increasing mechanization of farming, rising disposable income, increasing awareness of health and wellness, growing population, and expanding urbanization. The structure of the global food industry is continually changing and evolving as food suppliers, manufacturers, and retailers adjust to meet the needs of the consumers, who are increasingly demanding a wider variety of higher quality products.

Global Food Industry Statistics and Market Size Overview

I. Vital Statistics Quantity Unit Date Source
Total Value of Global Food Exports 1,486.30 bn USD 2014 WTO
Total Value of Global Food and Agricultural Industry 7.8 tn USD 2015 PRE
Global Non-Food Agricultural Exports 279.1 bn USD 2014 WTO
Global Food and Agricultural Sector Revenues 7.9 tn USD 2015 PRE
Global Food and Agricultural Sector Share of GDP 10 percent 2015 PRE
Global Packaged Food Industry 2.5 tn USD 2015 PRE
Food Production Increase Required to Meet Global Demand 70 percent 2010-2050 UN
Global Organic Food Sales 72 bn USD 2013 INFORM
II. Aquaculture
Estimated Global Aquaculture's Share of Fish for Human Consumption 60 percent 2013 FAO
Global Aquaculture Exports 160 mn tonnes 2013 FAO
Total Value of Global Aquaculture Exports 136 bn USD 2013 FAO
III. Other
Global Wine Market 420 bn USD 2013 VINEXPO

WTO = World Trade Organization

IFOAM = International Federation of Organic Agriculture Movements

PRE = Plunkett Research Estimate

FAO = UN Food and Agriculture Organization

UN = United Nations

Source: Plunkett Research, Ltd.

II. Scenario in India

Agro-Food processing, one of the focus sectors in the ‘Make in India’ initiative is considered as one of the fastest growing industries in India. The processed food market, valued at USD 322 billion in 2016, is expected to grow to USD 543 billion by 2020 at a CAGR of 14.6% . The growth of the industry is supported by the availability of a large raw material production base :

  1. Globally, India ranks 2nd, only next to China, in total food production
  2. India ranks 1st in the world in terms of production of Milk, Bananas, Mango, Guava, Papaya, Ginger and Okra
  3. India ranks 2nd in the world in production of Green peas, Potato, Tea, Tomato, Sesame Seed and many other key commodities
  4. India is also amongst the top 10 countries in the world in terms of land area under organic agriculture. The country produced around 1.35 million MT of certified organic products (2015-16)

India’s 60 Agri-Export Zones, 34 Mn MT of Cold Storage Capacity, 41 Mega Food Parks and 228 cold chain projects approved by Ministry of Food Processing Industries (MoFPI) paves a way for exploring huge opportunities in the sector.

FDI inflow in Food Processing Industries sector from April 2000 to September 2017 was USD 8,003.17 Mn

India’s geographical location gives it a unique advantage for exports, having convenient connectivity to Europe, Middle East and Africa from the western coast; and Japan, Singapore, Thailand, Malaysia, Korea, Australia and New Zealand from the eastern coast. India's exports of Processed Food was USD 4.19 billion in 2016-17 . Total agricultural exports from India grew at a CAGR of 19 per cent over FY10-16 to reach USD 32.08 billion in FY16.

Liberal FDI regime
India permits 100 per cent FDI in the food processing sector through the automatic route (barring alcohol and sectors reserved for small scale industries), and 100 per cent FDI under Government route for trading, including through e-commerce, has been permitted in respect of food products manufactured and/or produced in India
Thriving supply
An abundant input resource base / supplier market, keen on value addition, presents
chain
evergreen avenues to investors. The Government of India expects the food processing route to consume around 25 per cent of the total national produce by 2025.
Skilled human resource base
A vast and adequately skilled human resource base, founded on a robust tradition of household food processing, promises to impart scale and sustainability to the sector. Food processing activities are expected to employ nine million people in India by 2024
Conducive regulatory regime
A unified certification regime under the Food Safety Standards Authority of India (FSSAI) basis tests from a network of recognised testing laboratories (public / private) throughout the country ensures and preserves the sector’s regulatory credibility and stability
Schemes / Incentives
Introduction of Schemes such as Pradhan Mantri Kisan SAMPADA Yojana, Mega Food parks, Cold Chain, Creation / Expansion of Food Processing / preservation capacities, Agro Processing Cluster, Food Safety & Quality Assurance infrastructure, as well as availability of affordable credit and other fiscal incentives has also led to India being considered as one of the most favourable markets

Key trends

Conducive regulatory regime :
A unified certification regime under the Food Safety Standards Authority of India (FSSAI) basis tests from a network of recognised testing laboratories (public / private) throughout the country ensures and preserves the sector’s regulatory credibility and stability
Increase in private participation :
The private sector has recently increased its investments in improving quality and composition of existing products. For instance, Mahindra & Mahindra announced its entry into pulse retailing under the brand ‘NuPro’ which marks their foray into e-retailing. IFFCO also announced its joint venture with Japanese firm Mitsubisi Corp for manufacturing agrochemicals in India. Furthermore,the Indian Government has allowed 100% FDI in several segments of the agriculture sector (fertilizers, agricultural machinery, horticulture, development of seeds, animal husbandry and the cultivation of fruits and vegetables) which has led to increase in foreign investments in agricultural sector. For instance, Israel-based ADAMA Agrochemicals, the world’s seventh-largest agrochemicals firm, unveiled their plans to invest at least US$50 million in India over the next three years.
Emphasis on R&D :
The Government has led stress on the need for research in the field of agriculture to determine the health of soil and its needs in terms of seeds, water quantity, amount of fertilization, etc. The Prime Minister encouraged to make more use of scientific technologies to help raise agricultural production. The government emphasized on the role of eastern part of India (comprising eastern Uttar Pradesh, Bihar, West Bengal, Jharkhand, Assam and Odisha) to bring about the major part of the second green revolution and provide food security.
Eastern states being developed as organic farming hub :
Over the last few years, the demand for organic food and products is increasing rapidly. India is also emerging as a prominent global supplier of organic processed fruits. In January 2016, Prime Minister Narendra Modi declared Sikkim as the first state in the country to practice organic farming. Sikkim banned the use of fertilizers and pesticides in farming in 2008 and 74,000 hectare land has been brought under organic cultivation across the state. As of November 2017, the State Government plans to launch second phase of organic farming to carry out large scale production, create value-addition, establish global supply chain and strengthen export mechanism.
Given the strong demand for organic produce internationally and the growing demand domestically, organic farming could present millions of farmers with an opportunity to earn more. The Government of India (GoI) has made it a priority to develop Bihar, Odisha, West Bengal and Eastern Uttar Pradesh into organic farming hubs.
Rapid shifts in eating habits :
Rise in income of people has led to high demand for nutritive foods, including fruits and vegetables, in addition to staple cereals and pulses. Vegetarianism is also becoming increasingly popular globally. This change in eating habits has made it feasible for farmers to diversify into horticultural crops, which have relatively high nutrient requirements. Moreover, the process of their cultivation is labor intensive.
  • a) Fruits & Vegetables
    • • With production at 259 million MT, India ranks as the second largest producer of Fruits and Vegetables (F&V) in the world
    • • F&V processing levels currently stand at close to 2%
    • • Investment opportunities exist in initiatives aimed at reducing wastage, including infrastructure (cold chain, processing infrastructure), R&D for processed food & packaging, innovative on-farm preservation systems and skill development
    • • Uttar Pradesh, Andhra Pradesh, Maharashtra, Gujarat and Karnataka are the leading producers of fruits in India, having a combined share of ~ 51% in the total fruits production
    • • For vegetables, major producers include Uttar Pradesh, West Bengal, Madhya Pradesh, Bihar, and Gujarat, accounting for around 55% of the national production
    • • During 2016-17, India exported fresh fruits and vegetables worth USD 1.6 bn
  • b) Dairy
    • • With production of around 163.7 million MT (2016-17), India is the largest producer of milk globally.
    • • India’s milk production is expected to reach 180 million MT by 2020, from current 163.7 million MT, while the demand is projected (by NDDB) to reach 200 million MT.
    • • Per capita availability of milk in India has reached 352 grams per day.
    • • Uttar Pradesh is the largest milk producing state in India contributing around 17% to the total milk production, followed by Rajasthan, Madhya Pradesh, Gujarat and Andhra Pradesh contributing 12%, 8%, 8% and 7% respectively
    • • India exported dairy products of around USD 0.2 bn in the year 2016-17
  • c) Poultry
    • • India has the world’s largest population of livestock and produces around 7.4 million MT of Meat and around 88 bn eggs annually.
    • • India is the largest producer of buffalo meat and 2nd largest producer of goat meat.
    • • Current processing levels in poultry are 6%, while for meat it stands at 21%
    • • India exported meat and poultry products worth around USD 4.1 bn in 2016-17
  • d) Fisheries
    • • India is endowed with abundant geographical resources suited for both marine and inland fisheries, such as long coastline (7,517 km), abundant rivers and canals, reservoirs, ponds and tanks, and brackish water
    • • With a production of around 10.8 million MT, India is the second largest fish producer in the world, constitutes 6.3% of the global fish production
    • • The sector contributes 1.1% of the GDP and 5.15% of the agricultural GDP. Fish production is currently estimated at 6.4 million metric tons, with inland sector contributing 3.4 million metric tons and the remaining is contributed by marine sector.
    • • Fish and fish products have emerged as the largest group in agricultural exports of India, with 10.51 lakh tons in terms of quantity and INR334.42 billion in value. This accounts for around 10% of the total exports of the country and nearly 20% of the agricultural exports. More than 50 different types of fish and shellfish products are exported to 75 countries around the world.Export market is currently valued at USD 5.8 bn/1 mn MT. Most exports currently are in the frozen form and there is immense potential for exporting value added products.
    • • Inland fisheries, reservoirs and freshwater aquaculture are the pillars of growth of the aquaculture industry in India. Floodplain lakes and wetlands, irrigation canals, saline and waterlogged areas are also contributing to the rising production. Andhra Pradesh, Gujarat, Karnataka, Kerala, Maharashtra, Orissa, Tamil Nadu and West Bengal are the key marine-producing states in India.
  • e) Food Grains
    • • India is the second largest producer of food grains
    • • As per the Advance Estimates, the estimated production of major crops during 2016-17 is as under:
    • • Food grains: 273.38 Mn tonnes, Rice: 109.15 Mn tonnes, Wheat: 97.44 Mn tonnes, Coarse Cereals: 44.39 Mn tonnes, Maize: 26.14 Mn tonnes, Pulses: 22.40 Mn tonnes
    • • Uttar Pradesh accounts for the highest food-grains production among States in India (42,550,800 MT)
    • • India's export of cereals stood at USD 6,074.Millions during the year 2016-17; Key importers of India's basmati rice include Saudi Arabia, Iran, UAE, Iraq, Kuwait and USA
  • f) Spices
    • • India is the world's largest producer, consumer and exporter of spices India produces around 75 of the 109 varieties of spices listed by ISO
    • • The key spices produced in the country include garlic, chili, pepper, coriander, cardamom, cumin, fennel, turmeric and ginger
    • • During 2016-17, a total of 9,47,790 MT of spices and spice products valued Rs.17664.61 crore (USD 2633 Mn) has been exported from the country
    • • Key exports include chili, turmeric, pepper, mint products and spice oils/oleoresins
    • • key export destinations include USA, China, Vietnam, UAE and Indonesia

III. Scenario in Uttar Pradesh

Uttar Pradesh is one of the major producers of horticultural crops and food grains in India, which serves as a lucrative base for the food processing industry. Also, being a predominant sector in the State, Agriculture and allied activities contribute 23% to the state’s GSDP in 2014-15. Some of the key facts related to Agro-Food processing industry of the State include:
  • • Largest producer of fruits and vegetables in India– Rank 1 in production of Food grains, Milk, Sugarcane, Potato, Peas, Mango, Gooseberry, Watermelon
  • • Land under Cultivation (2013-14, ‘000 hectare):
    • i. Arable land: 17,681
    • ii. Net sown area :16,546
    • iii. Total area sown :25,896
  • • Food Exports stood at USD 1,877.81 million (14,70,975.01 MT) in 2016-17 (April - January), with a contribution of 60% to India’s total meat export
  • • Major Exports from FPI Sector in UP (in INR lacs)
    Sector 2015-16 2016-17
    Horticulture & Processed Food 504.93 2638.10
    Processed Meat 14594.73 15078.93
    Menthol & Essential Oil 1608.76 1101.04

Key Investment Enablers for the sector

  • • Location:
    Strategic location as Gateway to East India and Nepal – well-connected through extensive rail/road network (Amritsar-Delhi-Kolkata and Delhi-Mumbai Industrial corridors pass through the state)
  • • Diverse Agro Climatic Zones
    Uttar Pradesh is enriched with diverse climatic conditions. The State can be segmented into nine agro climatic zones having specialities in different forms of agro commodities
    Sr.No. Agro-Climatic Zones Districts Major Crops Specialty
    1 Tarai zone Saharanpur, Muzaffar Nagar,
    Bijnore, Moradabad, Rampur,
    Bareilly, Pilibhit,
    Shahjahanpur, Lakhimpur Khiri,
    Bahraich, Shravasti    		 Paddy, wheat,
    Mustard, Urd,
    Moong, Arhar.    		 Aromatic Rice.
    2 Western plain zone Saharanpur, Muzaffar Nagar,
    Meerut, Bagpat, Ghaziabad,
    Gautambuddh Nagar, Buland Shahar    		 Paddy, wheat, Mustard, Urd, Moong Aromatic Rice.
    3 Mid-Western plain zone Bareilly, Badaun,
    Pilibhit, Muradabad,
    Amroha, Rampur,
    Bijnore     		Paddy, wheat,
    Mustard, Urd,
    Moong, Arhar    		 Coarse Rice.
    4 South-Western semi arid zone Agra, Firozabad,
    Aligarh, Hathras,
    Mathura, Mainpuri,
    Etah    		 Wheat, Paddy,
    Jowar, Bajra,
    Mustard, Urd,
    Moong, Ground nut,
    Pea, Arhar    		 Oil and Bajra.
    5 Central plain zone Kanpur Nagar, Kanpur Dehat,
    Etawah, Auraiya, Farrukhabad,
    Kannauj, Lucknow,
    Unnao, Raebareli,
    Fatehpur, Kaushambi,
    Allahabad, Hardoi    		 Paddy, wheat, Mustard,
    Urd, Moong,
    Maize, Sunflower,
    Jowar, Bajra,
    Arhar    		 Sunflower.
    6 Bundelkhand Zone Lalitpur, Jahansi,
    Jalaun, Hamirpur,
    Mahoba, Banda and Chitrakut.    		 Urd, Moong, Barley,
    Til, Wheat,
    Jowar, Bajra,
    Pea, Gram    		 Table Pea and Til.
    7 North Eastern plain zone Gorakhpur, Mahrajganj,
    Deoria, Kushi Nagar,
    Basti, Sant Kabir Nagar, Siddharth Nagar,
    Gonda, Bahraich,
    Balrampur and Shrawasti.    		 Paddy, Wheat,
    Arhar, Urd,
    Moong, Masoor,
    Mustard, Maize    		 Sticky Coarse Rice.
    8 Eastern plain zone Azamgarh, Mau,
    Balia, Pratapgarh,
    Faizabad, Ambedkar Nagar,
    Barabanki, Sultanpur,
    Varansi, Chandauli,
    Jaunpur, Ghazipur and Bhadohi.    		 Paddy, Wheat,
    Arhar, Urd,
    Moong, Masoor,
    Mustard, Maize    		 Sticky Coarse Rice.
    9 Vindhyan zone Allahabad, Bhadohi,
    Mirzapur and Sonbhadra    		 Jowar, Bajra,
    Til, Gram,
    Urd, Moong, Arhar.    		 Pigeon Pea.

  • • Raw Material Availability: Key Agricultural Products (2015-16):

    Sr.No. Item India U.P Share of UP in India's total output (%) UP's Rank
    1 Potato 45.95 13.14 28.59 1
    2 Mango 18.83 4.53 224.06 1
    3 Livestock(excluding cow) 512.06 68.71 13.41 1
    4 Milk Production 155.48 26.39 16.97 1
    5 Wheat 93.5 26.87 28.74 1
    6 Food Grains 252.22 44.01 17.45 1
    7 Sugarcane 352.16 145.39 41.28 1
    8 Rice 104.3 12.5 12 2
    9 Bajra 8.06 1.78 22.03 2
    10 Vegetables 167.06 23.58 14.11 2
    10 Fruits 86.28 8.65 10.03 3

  • • Infrastructure Availability:

    Inland container depots 10
    Existing Industrial Areas/ SEZs 52 industrial areas (1,546 acres available)
    10 SEZs
    Agri Export Zones 4 Agri Export Zones:
    • Potatoes: Agra, Hathras, Farrukhabad, Kannoj, Meerut, Baghpat and Aligarh, Janpad Badaiyun, Rampur, Ghaziabad, and Firozabad
    • Mangoes and Vegetables: Lucknow, Unnao, Hardoi, Sitapur and Barabanki
    • Mangoes: Saharanpur, Muzaffarnagar, Bijnaur, Meerut, Baghpat and Bulandshahr, Jyotifulenagar
    • Basmati Rice: Bareilly, Shahjahanpur, Pilibhit, Rampur, Badaun, Bijnor, Moradabad, JB Phulenagar, Sharanpur, Mujjafarnagar, Meerut, Bulandshahr, Ghaziabad And Baghpat
    Cold Chains Cold chain projects assisted by MoFPI : 9
    Total Cold Storages : 2209
    Capacity: 13807762.3 MT
    Registered FPOs 35 (33 registered, 2 under process)
    Farmers Mobilized: 35,746
    Agriculture Marketing 250 regulated markets, 225 rural markets, 170 Farmer Producer Organizations, 238 rural godowns and 100 mandis registered with eNAM

  • • Key Industrial Clusters and Investment Zones

    S. No. Category Districts
    1 Wheat Hardoi, Aligarh, Budaun, Bulandshahar, Shahjahanpur, Azamgarh, Meerut, Moradabad, Barelly, Kanpur, Gorakhpur, Faizabad, Varanasi
    2 Rice Shahjahanpur, Barabanki, Kheri, Siddharth Nagar, Gorakhpur, Barabanki, Gonda, Kheri, Barelly, Moradabad, Meerut
    3 Bajra Agra, Budaun, Aligarh, Firozabad, Kasganj
    4 Mango Lucknow, Saharanpur, Unnao
    5 Banana Gorakhpur, Kushi Nagar, Kaushambi, Maharajganj, Baharaich, Barabanki, Lucknow, Allahabad, Fatehpur, Lakhimpur-khiri
    6 Guava Budaun, Kasganj, Aligarh, Farrukhabad, Hathras, Unnao, Kanpur Nagar, Kaushambi,Allahabad
    7 Watermelon Aligarh, Firozabad, Etah, Farukkhabad, Kasganj, Sitapur, Barabanki, Kanpur Nagar,Unnao, Agra
    8 Potato Agra, Hathras, Firozabad, Kannauj, Aligarh, Farukkhabad,Mainpuri
    9 Peas Jalaun, Lalitpur, Jhansi
    10 Tomato Mainpuri, Agra, Etah, Barabanki,Unnao
    11 Urad, Gram, Pea & Arhar Jhansi, Lalitpur, Kanpur, Jalaun
    12 Mustard Agra, Kanpur

Processing clusters in UP

Infrastructure clusters in UP

Prodution clusters in UP

• Food Parks / Industrial Park /Growth Centres:

  • • Food Park, Varanasi
  • • Shivalik Agro Industrial Food Park, Saharanpur
  • • Food Park, Barabanki
  • • Food Park, Gorakhpur
  • • Trishundi, Faizabad-Sultanpur-Allahabad road, Amethi
  • • Kosi Kotwan Extn. II, Agra-Delhi National Highway, Mathura
  • • Khemsepur, Farukkhabad
  • • Plastic city – Dibiyapur, Auraiya
  • • Kosi Kotwan Extn. I, Agra-Delhi National Highway, Mathura

Agro Park Karkheon, Varanasi:

  • o Located on Varanasi Jaunpur Road (NH-56), just 31 Kms from Varanasi, it has 261 Acres earmarked for this mega food park.
  • o 166 Acres have been developed and a total of 384 plots have been planned with 10 Acres reserved for facilities like Administration building, Police Station and Overhead Tank.
  • o 11 Acres have been reserved for green zones, with drainage is present in the form of a planned drain, Sub station, Power lines and Street lightings are available

Mega Food Park, Baheri

  • o 40 km from Bareilly town bordering Uttarakhand. 247.60 Acres have been earmarked for the mega food park.
  • o Total of 118 plots, with area reserved for Weigh Bridges, Garbage Collection Centre, CETP, Dispensary, Parking Bay, Restaurants and Electrical Substation.
  • o State animal husbandry department and KEL Sugar Mill is located close by
  • o 132 kva dedicated feeder, 30 metre wide roads, ample green belt and parks, make it a unique proposition

Barhgarh-II, Chitrakoot

  • o 70 Acres available, close to Madhya Pradesh state border, in Chitrakoot district (About 56 kms from Allahabad railway station, with rail, road & air connectivity)
  • o Identified as major cluster to grow Aonia and Citrus Fruits.
  • o Facilities like Power Station, Post Office, Police Station and Banks in the vicinity.
  • o Located in the Bundelkhand Region, this Industrial Area attracts special incentives as per “Industrial Investment and Employment Promotion Policy of Uttar Pradesh 2017

Agro Park, District-Barabanki

  • o Located in Barabanki district, close to state capital of Lucknow, in close proximity to “Integral University” and “Guru Govind Singh Sports College”.
  • o Identified as a major cluster to grow Mentha, Mangoes and Bananas.
  • o Aesthetically made with properly categorised roads, high mast sodium vapour lamps and street lighting system.
  • o Cold storage, administrative building, Overhead water tank, 132KVA sub station, police outpost and parks are inside the area.
  • o In the total acquired land of 329.46 Acres, 246 plots have been developed

Trishundi Industrial Area, District-Amethi

  • o Strategically located on the Sultanpur-Allahabad Highway at Trishundi, 44 Kms from Amethi Town, 5 Kms is the nearest rail head at Ramganj and 80 Kms from Allahabad Airport.
  • o Developed on 630 Acres of land
  • o Total area available for allotment is 148 Acres to MSME
  • o CRPF and Indian Oil Corporation Ltd has almost 85% area. The remaining area is being recalibrated to offer smaller plots

Khemsepur, Farukhabad

  • o 194 acres available for allotment, 145 Kms from Kanpur, located on “Grand Trunk Road” also known as National Highway 2, Khemsepur .
  • o Located on the potato growing belt of Uttar Pradesh and being equidistant from Western and Eastern UP, it can serve as food processing hub for entire UP

Sub-Sectors of Agro-Food Processing

  • a) Fruits & Vegetables
    • o Ranks 1st in potato (28.6%), 2nd in vegetables (14.11%) & 3rd in fruit (10.03%) production in India
    • o Hosts the major fruit belts for mango (highest production in India), aonla (highest production in India) & guava (second highest production in India)
    • o Major spices grown in the state are chilies, garlic, ginger & turmeric
    • o Major vegetables grown in the State are peas, potato, cabbage, tomato, okra, etc.
  • b) Grains
    • o Highest food grain(17.5%) & wheat (28.7%) producing state in India
    • o Major food grains produced in the state are rice, wheat, maize, bajra, gram and pea
    • o 2nd largest producer of rice in India contributing 12% to the national production
    • o 2nd largest producer of bajra in India contributing 22% to the national production
  • c) Poultry
    • o State produces 2,078 million eggs annually
    • o Huge opportunity exists as 3.65 billion eggs and 90 million poultry chicks are procured annually from other states
  • d) Meat
    • o Largest exporter of processed frozen meat
    • o Contributes more than 60% of India's meat export annually
    • o 15 modern integrated abattoirs and 35 meat processing units
    • o Buffalo meat - main source of meat production and export; other sources of meat include sheep and goat
  • e) Fisheries
    • o 3rd largest producer of inland fishes in India
    • o Total fresh water fish production of U.P. for the year 2014-15 was 494.26 million tonnes (national production was 6581.12 million tonnes

Ease of Doing Business in the State

  • a. Reforms Undertaken
    The state government has undertaken a number of reforms to offer an enabling and investor- friendly business climate for investors keen on setting up business in the state. Some of the key EoDB initiatives by the state include:
    • • ‘Invest UP’ is the dedicated organization under the state government set up with a vision to promote economic growth by facilitating investment in industrial and service sectors and to provide a conducive business environment supported by a robust policy backbone.
    • • ‘Nivesh Mitra’ has been set up as the online single window system of the state where entrepreneurs can apply for all the approvals/clearances required for starting a business through a Common Application Form (CAF)
    • • Provisions for self-certification, deemed approvals and third party certification have been made
    • • Strict and reduced timelines: Clear timelines have been specified for approval/rejection of applications. Existing timelines have been benchmarked against the best and necessary powers have been delegated to district level officers for timely disposal
    • • Investor handholding: The state has put in place provision of an online application system along with a dedicated helpline number for grievance redressal of investors
    • • Streamlined land allotment process is available, coupled withGeographical information system providing details of land earmarked for industrial use
    • • The state has set up a digitized system for maintaining land records
  • b. Policy Measures
    Uttar Pradesh has launched the following Policies for providing incentives to Agro-Food Processing related industries in the State:
    • • Uttar Pradesh Food Processing Industry Policy 2017
    • • Industrial Investment and Employment Promotion Policy of Uttar Pradesh 2017
    • • Uttar Pradesh Poultry Development Project, 2013

      Key incentives available for the food processing industry under major policies are summarized in the table below:
      Key Incentives Food Processing Industry.. Investment & Employment.. UP Poultry Development..
      Capital investment subsidy • 25% of cost of plant and machinery and technical civil works up to INR 50 lakhs. Additional grants-in-aid of 10% under SAMPADA scheme for fruits and vegetables processing industries.
      • 50% of project cost up to INR 1 lakh for small food processing units in rural areas.       		-- --
      Capital Interest Subsidy -- 5% per annum for 5 years in the form of reimbursement on loan taken for plant and machinery subject to a ceiling of INR 50 lakhs per year. --
      Interest Subsidy • Reimbursement of 100% bank loan interest for 5 years on capital investment for micro and small food processing industries.
      • Reimbursement of 7% bank loan interest up to INR 50 lakhs in a year for 5 years on capital investment for establishments other than micro and small food processing industries.
      • Reimbursement of 7% bank loan interest up to INR 50 lakhs for 5 years on purchase of reefer vehicle/ mobile cooling van       		Reimbursement of 5% interest payable on loan for maximum of 5 years up to INR 1 crore per unit. 10% interest subvention on loan for 5 years up to INR 40 lakh.
      Electricity duty exemption -- Exemption from electricity duty for 10 years to all new industrial units set up in the state (including ones producing electricity from captive power plants for self-use). INR 1,200 to INR 2,400 per month for 10 years
      Stamp duty exemption -- 50%-100% exemption 100% exemption in the stamp duty on purchasing of the land for poultry units with maximum area between 3 to 6 acres
      Exemption on mandi fees -- Exemption on purchase of raw materials for 5 years for all new food processing units. Exemption on purchase of raw materials for 5 years (units with at least INR 5 crore investment in plant & machinery)
      Incentives for private sector industrial parks/ estates/Mega Food Parks Additional grants-in-aid of 10% of project cost with a minimum investment of INR 50 crores under SAMPADA scheme • Reimbursement of interest up to 50%-60% of annual interest for 7 years on loan taken for land, building and infrastructure (ceiling of INR 50 lakhs- INR 10 crores pa; INR 50 lakhs - INR 50 crores per industrial estate/ agro-park)
      • 50%-100% exemption on stamp duty for purchase of plots in the industrial parks/estates.      		 --
      Employment generation related incentives -- Units generating minimum employment of 200 direct workers including skilled and unskilled will be provided 10% additional EPF reimbursement facility on employer’s contribution. --
      Patent registration and quality certification incentives • 75% reimbursement up to INR 1.5 lakhs for patent/design registration
      • 50% reimbursement up to INR 1.5 lakhs for internationally accepted quality/environmental certification.      		 -- --
      Human resource development Grants up to INR 75 lakhs per institution/university towards infrastructure development for running degree/ diploma/ certificate courses. -- --
      Market development and export promotion • 50% reimbursement of expenses, up to INR 2 lakhs per beneficiary, incurred on exporting processed food samples for test marketing.
      • Reimbursement of 25% of transportation cost up to INR 10 lakhs per year for 3 years.
      • 20% reimbursement of Free On Board value up to INR 20 lakhs per beneficiary per year for 3 years.      		 -- --
      Project preparation 50% assistance for expenses on preparation of DPR up to INR 5 lakhs. -- --

Centres of Excellence

  • a. Existing Training Institutes
    • • State Institute of Food Processing Technology, Lucknow
    • • Regional Food Research & Analysis Centre, Lucknow
    • • 10 Govt. Food Science training centers at Divisional level
    • • 75 Govt. Community Fruit Preservation & Training Centers at District level - training 25,000 students
  • b. Leading Agriculture Universities and Institutes
    • • Chandra Shekhar Azad University of Agriculture and Technology, Kanpur
    • • Narendra Dev University of Agriculture and Technology, Faizabad
    • • Sam Higginbottom Institute of Agriculture, Technology and Sciences, Allahabad
    • • Sardar Vallabhbhai Patel University of Agriculture and Technology, Meerut
    • • Indian Veterinary Research Institute, Bareilly
  • c. Regional Food Research & Analysis Centre (R-FRAC)
    • • Center of Excellence established to provide analysis and testing facilities to the food processing industries in India
    • • Advance Facilities for Testing and Analysis
      • o Nutritional Labelling
      • o Pesticide Residue
      • o Bio-Pesticide
      • o Fertilizers
      • o Hormones, Steroids
      • o Microbial Examination
      • o Shelf life studies
      • o Detection of Heavy/Trace Metals

Snapshot of potential investable projects

Uttar Pradesh offers tremendous opportunities for investment across the entire value chain in the food processing sector. An indicative list of potential projects for investment is presented below:

  • a) Manufacturing & Supply of agro inputs – Given the huge agrarian economy of the state, immense potential exists in manufacturing, production and supply of necessary fertilizers, seeds, agro-chemicals, farm equipment, machinery and irrigation systems to increase production and productivity
  • b) Extension Services and Technology Transfer – Extension support and technology transfer to farmers on efficient utilization of the agro-inputs is another attractive investment option in the state.
  • c) Processing – With strong supply side advantages, local demand, rising export potential and policy support, processing of food products offer immense potential in the state. Considering the abundance of naturally existing agro-resources, investments in mango processing, turmeric processing, aonla processing, breakfast and cereal manufacturing, garlic and chilli processing, etc. is a promising opportunity in Uttar Pradesh.
    Sub-Sector Processable Products Value Proposition
    Mango processing Mango juice, pulp, candy, leather (mango papad), squash ► The global mango juice market is anticipated to reach INR 1,43,650 Cr by the end of 2024, expanding at a compound annual growth rate of 4.1% over the period i.e. 2016-2024.
    ► The fruit juice market in India is expected to grow at a CAGR of 35%-40%. The mango drink segment has 80% share of the fruit juices market.
    ► With production of 4,512.7 thousand tonnes of Mango in 2015-16 Uttar Pradesh is the highest producer of Mangoes in India.
    Turmeric processing Turmeric powder ► Global market size is expected to reach INR 645.45 Cr by 2024 and is expected to grow at a CAGR of over 6% till 2021.
    ► The cultivation of turmeric is growing in the state. The state is poised to cater to the increased demand of turmeric.
    Aonla processing Aonla powder, Juice, pickle, preserve, candy, chutney, sweets, flakes ► In addition to various uses in medical, packaged food sector etc., Aonla is used in value added hair oils which is expected to grow at a CAGR of 19.9% during 2014-19 in India.
    ► Uttar Pradesh is ranked 1st in production of Aonla in the country.
    Breakfast cereal manufacturing Cornflakes, sessamine, rice flakes ► The global breakfast cereal market was estimated at INR 2,79,500 Cr in 2016 and is expected to grow at a CAGR of 4.3% to INR 3,57,500 Cr by 2022.
    ► Overall consumption of breakfast cereals in India is set to increase by 13% each year for next three years.
    ► With production of 12509 thousands of tonnes of rice Uttar Pradesh is the 2nd highest producer of Rice in India.
    Garlic and chilli processing Garlic powder, paste, instant mix, chili paste, sauce ► Global condiments sauces market is expected to grow at a CAGR of 3.21% during 2014-20.
    ► With rise in production of Garlic, Chilli and other condiments in the State, the opportunities of processing these commodities in Uttar Pradesh is immense
  • d) Packaging – The largely unorganised sector in the state offers attractive opportunities for industries engaged in packaging technologies and services. Packaging techniques like Vacuum packaging, gas packaging, active and intelligent packaging, packaging of processed food through canning, tetra packing, aseptic packs, botting etc. also has top potential.
  • e) Preservation – Investment potential exists in preservation through fermentation, establishment of cold storage, facilities, traditional techniques like pickling, jellying, curing to produce different types of processed goods and modern industrial techniques like pasteurization, vacuum packing, artificial food additives, irradiation, bio preservation for large scale produce etc.
  • f) Infrastructure and Logistics:
    • a. Food Parks and Horticulture Hubs - Establishment of parks with multiple processing units has the potential for optimal usage of abundant agri-raw materials available in the State and help in realizing economies of scale.
    • b. Integrated units – Investment in developing integrated units with processing, preservation, packaging and warehousing facilities at notified Agro Parks in the state is a promising investment opportunity. These agro parks include Mega Food Park at Baheri, Agro Park at Barabanki, Khemsepur (Farukkhabad), Karkheon (Varanasi) and Barhgarh-II (Chitrakut).
    • c. Transport: Development of transport infrastructure especially for food that ensures timely and safe delivery of raw and processed good is still unexplored
    • d. Distribution: Distribution mechanism for processed agriculture produce to improve penetration of goods and increase the size of market.
  • g) Warehousing
    • a. Development of storage facilities like silos, PAU bin, Pusa bin etc. for agro produce to reduce wastage of agriculture produce and reaping of higher price of agriculture produce is an attractive potential in the state.
    • b. Changing preference of consumers for clean and safe meat and meat products offers potential for modern abattoirs in the state
  • h) E-Marketing: With an increased market spirit to for e- mandi and penetration of internet, opportunity exists to get better price of agriculture input
  • i) Research and Development: Immense scope for innovation exists to improve operating procedure and create new end products exists in:
    • • Development of Packaging Techniques
    • • Product Development
    • • Testing Technology & labs
    • • Seed Development
    • • Hybridisation
  • j) Skill Development: The state offers opportunities in
    • • Training in food processing technology
    • • Training farmers for maintaining the constant quality of produce.
    • • Improved farming techniques
    • • Training programmes to handle the cattle, birds and understanding of international food laws
  • k) Ecosystem development & Financing
    • • Microfinancing, credit and insurance facility for farms, MSMEs, industry and mega park engaged in food processing.
    • • Creation of business facilitation centres with linkage of all stakeholders i.e. Industry Associations, equity funds, banks and financial institutions
    • • Angel Funds / Venture Capital Funds for high-growth potential and start-up enterprises

Key Players