Bihar’s Industrial Investment Promotion Policy treats food processing as a priority sector. It offers numerous incentives such as Interest Subvention and Tax Related Incentive to food processing industries among others. The state is expecting about 20-25% growth in food processing as well as exports by 2020. Jai Kumar Singh, Minister of Industries, Government of Bihar, shares information on all these and more in an email interview with Manjushree Naik. Excerpts:
Bihar has a comprehensive Bihar Industrial Investment Promotion Policy (BIIPP), 2016, with food processing as a priority sector. How big is food processing industry in Bihar, at what rate is it growing and how have the figures improved since the policy was introduced two years ago?
We would like to apprise that Bihar is the first state in the country to have a food processing vision document and dedicated directorate for the food processing sector. Food processing has always been a priority sector for the state due to availability of the raw material. Bihar was the first state to have separate incentive policy for food processing sector in the country which later on was replicated in many states of the country.
In the earlier food processing policy, about 400 units were approved out of which more than 250 units are in commercial production. Under the BIIPP 2016, Department of Industries, Government of Bihar, has received 930 proposals for the State Investment Promotion Board approval after the passage of BIIPP 2016. Out of total 930 proposals, only 786 have received the Stage I clearance amounting to an investment of Rs 10,099 crore.
Out of the total projects receiving the Stage I clearance, 377 are under food processing (approved investment Rs 1,905 crore).
Bihar being an agrarian state has very big potential for food processing as raw material forms a major part in the whole processing value chain. Some of the food processing sectors which are attracting bigger investment in the state are cattle feed, poultry feed, dry warehouse, rice mills, bread and rusk, maize flour, meat processing units, pasta, noodles, cold storage, besan and satu units.
As far as quantification of the industry size is concerned, there is a need to do a separate study to quantify the exact size of the food processing sector and for assessing the impact of BIIPP 2016. The earlier capital subsidy scheme created the necessary infrastructure base for the growth of food processing which is being supported by the BIIPP 2016 in terms of assisting them in reducing the operational burden for the upcoming investors.
In Bihar food processing sector, the emphasis is on maize, fruit & vegetables, poultry and fish processing. Among these, industries such as makhana (fox nuts) and litchi are at the forefront. Elaborate on these as well as other sub-sectors that are growing rapidly.
As you know, Bihar is the largest producer of litchi and makhana in the country. A lot of work has been done for the growth and development of the litchi and makhana processing facility in the state. Due to the seasonal nature of the crops, very small window is available for processing and value addition in litchi and makhana. Nevertheless, there is big potential in both these crops.
What are the regulatory challenges that the state is facing with regard to its processed foods?
As you know with the repeal of APMC Act, procurement for food processing industry is easier when compared to other states. With the approval of the Single Window Clearance Act and creation of State Investment Promotion Board all the regulatory challenges in setting up the food processing units have been removed in the state. Still there is a need to set up world-class food testing labs, food safety compliance infrastructure for food safety. Department of Industries is working to create the necessary infrastructure in the state.