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INTERVIEW

“All clearances for starting industry, in 21 days”
Tuesday, 26 December, 2017, 08 : 00 AM [IST]
Ranked No. 1 among Indian states in 'Ease of Doing Business' by World Bank and Government of India, Andhra Pradesh has a comprehensive food processing policy in place. Further, leveraging on its strong agriculture, horticulture and aquaculture resources, the state is aiming at the top spot in agriculture in the country. In pursuance of this goal, AP is taking up several initiatives, one of them being the recent signing of MoUs at the World Food India event. Nara Chandrababu Naidu, Chief Minister, Andhra Pradesh, in an email interaction with Ashwani Maindola, reveals why his state is a favourite with investors and how this advantage will work in shaping up the growth in food processing and agriculture, going forward. Excerpts:

AP government, under a comprehensive five-year AP Food Processing Policy, has taken up several initiatives and projects. Elaborate on the goals that you envisage to achieve under this policy.
The envisaged goals under the Food Processing Policy are as follows: Increase in realisation to farmers for their produce, Creation of high quality processed foods by creation of processing infrastructure, Reduction in post-harvest losses, Capacity building of producers and processors, Creation of an efficient supply chain for food products, Direct and indirect employment generation, Schemes under the policy also aim to facilitate the establishment of food processing units with environmental protection systems, safety standard, quality control infrastructure etc.

Andhra Pradesh Food Processing Society (APFPS) acts as the nodal agency to supervise and monitor in achieving the envisaged goals under the policy.

How are Pradhan Mantri Kisan Sampada Yojana and Mega Food Parks Scheme projects being implemented in your state? How do you bring about a connection between these Central schemes and programmes that are taken up by the AP government?
The Kisan Sampada scheme recently launched by ministry of food processing industries, Government of India, has many components which are already covered under AP Food Processing Policy 2015-20.

Government of Andhra Pradesh is also having similar schemes such as Mega Food Parks/ Cold Chains/ Creation & Expansion of Food Processing Units with primary objective to provide modern infrastructure along with value chain from the farm to the market. It includes creation of processing infrastructure near the farm, transportation, logistics and Centralised processing centres.

A Mega Food Park is a huge infrastructure that comes up with all common facilities in one area. Then there will be space for other smaller units to come and plug, play and use those common facilities. This saves the hassle of putting in huge investment on the infrastructure.

Mega Food Park projects have already been accorded approval in earlier phases by ministry of food processing, GoI, to be set up in Andhra Pradesh. The state is also assisting 1 Ultra Food Park, 8 Mega Food Parks and 4 Integrated Food Parks from the state’s budget.

Kisan Sampada Scheme of MoFPI, Government of India, on timely basis invites Expression of Interest (EoI) from interested stakeholders/ parties for setting up projects across India under different schemes. At the time of EoI, entrepreneurs/ private players from AP, are being encouraged by the state to apply for grant-in-aid assistance from Central government under their schemes. APFPS also provides the required information, support and guidance to these entrepreneurs in filing their applications on a regular basis.    

AP is known for abundance of seafood, fruits and so on. How is your government planning to leverage potential of food processing sector in Andhra Pradesh? How much revenue you think this sector could generate along with employment in your state?
Government of Andhra Pradesh is very much focussed towards leveraging potential of food processing sector. Government has launched a dedicated food processing policy having various schemes to provide excellent infrastructure facility in food processing sector; opens up various opportunities for private investors.

AP is one of the leaders in agriculture, horticulture and aquaculture. We are at the forefront in eggs, meat, chillies, papaya, mango, tomato, citrus production and first both in production and in value terms in total fish/ prawn production in India.

Andhra Pradesh has the second-largest coastline in the country with a length of 974 km. Our aim is to become the aquaculture capital of the world, and a marine processing hub of the country. A dedicated aqua task force has been formed by the state to check and monitor the quality, safety & regulatory compliance and also organising campaigns to discourage antibiotics residuals usage.

Already 66 units in aqua processing sector with capacity over 1 lakh MT exists in the state which helps in achieving US$2 billion (70% of total shrimp exports) from India. Around 340 cold storage units with capacity of over 13.80 lakh MT (+ Temp.) are existing to minimise the post-harvest losses. A separate corporation is on the anvil for supporting cold chain systems in AP.

Chittoor district is also known as mango hub, which has the largest production of processable variety of mango in the country. Many international companies like Pepsi, Coca-Cola procure 60-70% of the total mango pulp used in their beverages from Chittoor itself.   

AP is the only state which utilises the funds of Government of India under Rashtriya Krishi Vikas Yojana (RKVY) for establishing food processing infrastructure. The state also promotes and supports women entrepreneurs for setting up food processing units in MSE sector by providing training, capacity building, skill development to women in handling processing operations efficiently.
 
For aqua, fruits & vegetables, milk and other perishables products, we have schemes for setting cold chain projects, and separate schemes for fish & shrimp processing units giving subsidy amount ranging from Rs 5 to 7 crore and Interest Subvention from Rs 2 to 2.5 crore for promoting such sectors. AP is the only state that incentivises setting up of primary processing centres near farms with subsidy of Rs 2.5 core and Interest Subvention of Rs 1 crore.  

Since 2014, APFPS has sanctioned close to 200 projects till date with a total investment of around Rs 6,000 crore and generated employment to more than 50,000 persons (direct & indirect).

In addition to above, more than 200 projects are in pipeline and at different stages, which have tied up with AP, proposing investment of around Rs 11,000 crore and expected employment to more than 80,000 persons (direct & indirect).

What are the sub-sectors within food processing sector where the investor can avail opportunities in AP?
Following are the sub-sectors within food processing wherein investors can avail opportunities:   Horticulture – All fruits & vegetables products; Agriculture – Agri products; Dairy – All milk and milk products; Meat – All meat and meat products; Aqua – All fish & shrimps.

Elaborate on the policy interventions made by your government vis-à-vis food processing sector for investors’ facilitation and making AP an attractive destination.
AP has identified food processing sector as an important growth engine and most industry- & farmer-friendly food processing policy is in place. Under the policy best in class incentives are offered to encourage food processing parks/ cold chain projects/ independent units/ primary processing centres etc. The incentive amount ranges from Rs 5 crore to Rs 50 crore.

In addition to subsidy, Interest Subvention is also offered under the policy to reduce the burden of loan and interest on the developers, making it as the best food processing policy in the country and also leading to AP as the most attractive destination.

AP has also been ranked no. 1 among Indian states in 'Ease of Doing Business' by World Bank and Government of India. It is a testimony to our resolve to create a conducive environment for business enterprises in the state.

AP is committed to maintain Ease of Doing Business in the state. Single Desk Policy is a major step towards creating a conducive business environment in the state.

Single Desk Policy aims to create a one-stop shop to provide all necessary clearances for starting and operating an industry, within 21 working days. The policy aims to eliminate the need to physically interact with regulatory authorities by providing for online filing and tracking of applications.

It also allows payments to be made electronically to obtain timely approvals online. The measures adopted under the policy include robust clearing mechanisms, special provisions and measures to simplify processes and procedures, easy availability of documents including application forms online, and electronic payment which is monitored on real-time basis though a Core Dashboard.

Elaborate on the MoUs signed between AP government. and various investors at the recently held World Food India Summit.
During the World Food India Summit 2017, AP entered into 17 MoUs amounting to approximately Rs 4,000 crore, with reputed international and national food processing companies. Major players include - Sharaf Group from the United Arab Emirates (UAE) to set up a logistics and food park in the state, worth Rs 2,000 crore; Janani Foods Pvt. Ltd propose to set up an Integrated Horticulture project of Rs 500 crore; Haldiram proposes to set up a food processing and manufacturing unit with an investment of Rs 400 crore; ITC Ltd proposes to set up a new spices processing and warehousing & logistics with an investment of Rs 250 crore.

Other players who have signed MoUs: Keventer Agro Ltd; Sesh Sai Foods; MNR Agri-Food Products; Foods and Inns; Freshfrugies; RF Exports; Bambino Pasta Food Industries; Supermarket Grocery Supplier Pvt. Ltd. (Bigbasket).

How do you plan to monitor these MoUs’ implementation on ground in a time-bound manner? Will there be a monitoring agency to look into the implementation of the projects and MoUs?
For promotion and development of food processing sector in the state, AP has formed APFPS, which functions under the industries department, a nodal agency having a dedicated monitoring cell which looks after grounding of projects in a time-bound manner. The cell has a team of consultants having experience in agribusiness, food processing, banking and dealing with investment related projects.   

In addition to the MoUs signed during the World Food India 2017 Summit, AP has signed around 360 MoUs/ projects seeking opportunities in food processing sector in the last two years during Partnership Summit 2016, 2017 and World Food Day 2017, of which, close to 60 per cent of projects have already been grounded and are under at different stages of implementation. Dedicated escort officer/s have been assigned to each project who regularly follow up and handhold the investor for any assistance required in implementation of their project.

You have plans to make AP the best state in agriculture in India. Elaborate.
AP is one of the leading agricultural states in India, popularly known as “Rice Bowl of India.” About 60% of state’s population is employed in agriculture and allied activities. We have already introduced several technological innovations and best practices in agriculture:

A. Use of satellite imagery and other technologies - Satellite imagery and remote sensing data is used for soil mapping and crop coverage area estimation at village level.
 
B. Soil health management and correction of micronutrients through soil analysis - Micronutrient deficiency correction based on soil analysis is one of the non-negotiable commitments of AP. The state government has undertaken a saturation mode micronutrients supplying on 100% subsidy. Soil mapping exercise is undertaken by department of agriculture with ICRISAT / APSRAC.

C. Micro irrigation coupled with fertigation - It has enhanced the productivity of horticulture crops ranging from 21% to 29% and farmer’s income has been enhanced ranging from 22% to 64%. District-wise progress of AP Micro Irrigation Project (APMIP) is monitored real-time on Core Dashboard.

D. Protective irrigation through rain guns - They have been used to overcome the prolonged drought situations. The rain gun equipment, water bodies and mobile units are geo- tagged.

E. Automatic Weather Stations for better weather monitoring (AWS) - 1876 AWS have been established in all the mandals. The stations have sensors for temperature, moisture, wind and also piezoelectric sensors for ground water level.

F. Mobile apps - They have been deployed for agricultural extension and information dissemination to the farmers, weather forecast and markets. The apps are also used for pest/disease monitoring (Plantix), real-time e-crop booking, Farmers are increasingly using the mobile app and benefitting immensely.

G. Pond automation and innovative aquaculture technologies - We have introduced pond automation technologies such as probes for measuring parameters such as dissolved oxygen, temperature, pH, and fish health. Solar powered feed dispensers and monitoring devices have been introduced for scientific monitoring of consumption.

H. Use of innovative horticultural technologies - Like off-season cultivation of vegetables under protected cultivation (Poly houses and Shade net houses), pandal system of vegetable cultivation, Trellis system for tomato, mulching for gourds and melons have enhanced the production by 30% and increased net-returns to the farmers by 35%.
I. Developing crop agri zones - Developing five crop (paddy, millets, pulses, groundnut and cotton) for scientific cropping pattern approach and improving post-harvest, value addition and marketing linkage.

J. Andhra Pradesh is the first state in India to link two major rivers (Krishna & Godavari).

With the help of these interventions, the GVA (Gross Value Added) share of agriculture and allied sectors in total GVA of the state is 26.77% against the all-India share of 15.35%.  

Do you think time has come for food processing and agriculture to be treated equally as they are complementary to each other and play a vital role in not only saving food wastages and giving employment but increasing farmers’ income as well?
The opportunity is always there. We have the largest raw material base for many food commodities in India. But, we just process barely 10 per cent of what we produce. In AP, people are used to cooking fresh food and consuming it.

The taste and preferences of people are changing now. We are trying to bring lot of processing infrastructure for food products because we realise that processing is the way in future. We just need to bring down our wastages and show better remuneration to the farmers. So, a chain and a certain environment needs to be created. Therefore, in order to meet the growing demand and tab the available potential, it is very crucial that agriculture & food processing act as complementary to each other.
 
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