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Small scale food processing industries in Gujarat
Tuesday, 29 June, 2021, 16 : 00 PM [IST]
Sanjay Indani & Khushbu Shah
Food processing Industry is typically divided in two distinct processes, primary processes includes raw agricultural produce carried out at farm level and secondary processing wherein new and modified products are manufactured and involve change in physical properties of produce at factory level.

Accounting for about 32 per cent of the country's total food market, the food processing industry is one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth. Food processing sector of Gujarat is growing very fast, however there is still immense untapped potential for the sector in Gujarat. There are more than 30,000 food processing units operating in Gujarat providing employment to over 1 million people.

Major agriculture commodities grown in Gujarat are Groundnuts, Cotton, Soybeans, Maize, Pulses, Wheat and Rice. The spices produced in the State mainly includes Cumin, Fennel, and Garlic. The State enjoys monopoly in seed spices. Isabgul is prominent medicinal crop grown in the State.

Various initiatives and Government schemes are available for food processing industries which here by provides good scope for entrepreneurs to establish new food and beverage processing units in Gujarat.

Some of the major initiatives include:
•    Income Tax – 100 % Tax Exemption for first 5 Years of Operation for New units in the business of processing, preservation and packaging of fruits and vegetables.
•    Service Tax – Exemption of service tax for storage, handling and transportation of processed food.
•    Customs Duty Benefits to projects of cold storage and handling system for processed food.
•    FDI & Credit Availability – 100% FDI allowed under automatic route. Soft loan is extended of up to 95% of project cost.

The Gujarat Industrial Development Corporation (GIDC) also provides assistance to new and existing entrepreneurs for better development. Objective of Scheme for Technology Upgradation/ Establishment/ Modernisation for Food Processing Industries is to increase the level of processing, reduction of wastage, value addition, enhance the income of farmers as well as increase exports thereby resulting in overall economic development.

Growth opportunities for entrepreneurs in Gujarat are identified in various food processing sectors. With the help of these initiatives, easily available agro produces and advancement in technologies, entrepreneurs can truly grow and flourish.
•    Pickles eg: Mango
•    Banana wafers
•    Canning of Fruits
•    Dehydrated fruits and vegetables
•    Freeze dried food processing unit
•    Milk and dairy products
•    Starch processing- Specialty grades guar gum powder
•    Malt Manufacturing
•    Canning of fish
•    Manufacturing of spices- Cryogenic grinding
•    Enzymes for food processing industry
•    Tomato Processing at Important crop pockets- flakes/powder
•    Some innovative processing includes Ice-cream balls, organic milk & milk products, banana fibre extraction, etc.

Pradhan Mantri Kisan Sampada Yojana is a comprehensive package which will result in creation of modern infrastructure with efficient supply chain management from farm gate to retail outlet. It will not only provide a big boost to the growth of food processing sector in the country but also help in providing better returns to farmers. Schemes implemented under PMKSY includes:

1.    Mega Food Park Scheme in Gujarat
The Scheme of Mega Food Park aims at providing a mechanism to link agricultural production to the market by bringing together farmers, processors and retailers so as to ensure maximising value addition, minimising wastages, increasing farmer’s income and creating employment opportunities particularly in rural sector. The Mega Food Park Scheme is based on “Cluster” approach and envisages a well-defined agro/ horticultural-processing zone containing state-of-the art processing facilities with support infrastructure and well-established supply chain.

Two Mega Food Park projects in Gujarat are:
1.    The Gujarat Agro Mega Food Park Pvt. Ltd., (project SPV) in Surat district is operational
2.    Fanidhar Mega Food Park located in Mehsana is still under development.

Gujarat Agro Infrastructure Mega Food Park is an industrial estate focused exclusively at the food processing sector. They provide enabling infrastructure and mechanisms to strengthen the Agricultural value chain, bringing together Farmers, Food Processors and the End Consumers such as Wholesalers, Retailers & Exporters. This mega food park is Supported and Approved by Central and State Governments. It is located in the most favourable place with easy procurement, processing and export facilities.

  2. Cold Chain projects in Gujarat
4th highest share in India's total cold chain storage capacity and 8 such cold chain projects have been approved by the Ministry in Gujarat. The objective of the Scheme of Cold Chain, Value Addition and Preservation Infrastructure is to provide integrated cold chain and preservation infrastructure facilities, without any break, from the farm gate to the consumer. It covers creation of infrastructure facility along the entire supply chain viz. pre-cooling, weighing, sorting, grading, waxing facilities at farm level, multi-product/ multi temperature cold storage, CA storage, packing facility, IQF, blast freezing in the distribution hub and reefer vans, mobile cooling units for facilitating distribution of horticulture, organic produce, marine, dairy, meat and poultry etc. The scheme allows flexibility in project planning with special emphasis on creation of cold chain infrastructure at farm level.

The different components of the Cold Chain projects are:
•    Minimal Processing Centre at the farm level and centres is to have facility for weighing, sorting, grading waxing, packing, pre-cooling, Control Atmosphere (CA)/ Modified Atmosphere (MA) cold storage, normal storage and Individual Quick Freezing (IQF).
•    Mobile pre-cooling vans and reefer trucks.
•    Distribution hubs with multi products and multi Control Atmosphere (CA)/ Modified Atmosphere(MA) chambers/ cold storage/ Variable Humidity Chambers, Packing facility, Cleaning in Process (CIP) Fog treatment, Individual Quick Freezing (IQF) and blast freezing.
•    Irradiation facility.

3.    Food Safety & Quality Assurance Infrastructure
Quality and Food Safety have become competitive edge in the global market for food products. For the all-round development of the food processing sector in the country, various aspect of Total Quality Management (TQM) such as quality control, quality system and quality assurance should operate in a horizontal fashion. Apart from this, in the interest of consumer safety and public health, there is a need to ensure that the quality food products manufactured and sold in the market meet the stringent parameters prescribed by the food safety regulator. Keeping in view the aforesaid objectives, government has been extending financial assistance under the scheme.

Export oriented food processing includes:
Export market for processed foods is steadily growing in Gujarat. It mainly exports to USA, Europe, UAE, Australia, Japan, China, Canada, Brazil, Thailand, Germany and a few other countries. Food Products processed with special focus on export market includes:
•    Peanut butter
•    De-hulled roasted sesame seed and sesame oilseed
•    Roasted, salted and coated peanuts
•    Integrated shrimp farming and processing

Technological Development
The following are the emerging technologies in food processing /preservation which have great scope for future commercial applications in the food processing industry. This includes
•    Individual quick freezing (IQF),
•    Aseptic packaging,
•    Controlled atmosphere packaging and storages
•    Pulsed electric field processing,
•    High intensity pulsed light processing,
•    UHT processing
•    Intelligent or smart packaging,
•    Edible / water soluble packaging
•    Application of radio frequency identification (RFID) system and nano-technology in food packaging.

SWOT Analysis:
1.    Strengths
•    Leading producer of various agricultural commodities such as milk, fruits and vegetables, marine products, etc.
•    Growing domestic market
•    Rise in disposable income
•    Proximity to growing international markets like Gulf, Middle East etc. with a sea route.
2.    Weaknesses
•    Lack of comprehensive national food processing policy leading to inconsistency in Central and State policies.
•    Delays in land acquisition due to requirement of conversion of land use (non-agricultural use permission).
•    Lengthy procedures for Government clearance
•    Dominance of unorganized sector (42%) and small scale (28%) in the food industry operating at low scale and high cost of production.
•    Inadequate facilities for mentoring of Start Ups and pilot testing of technologies and innovations. There is also lack of applied research on processes and technology.
•    Non-availability of skilled man power for food processing is a big challenge. Industrial training institutions providing skill-based training /diploma courses are limited.
3.    Opportunities
•    Setting up of Special Economic Zones (SEZs), Agri-Export Zones (AEZs) and mega food parks for providing the needed infrastructure for small scale units.
•    Rising income levels and changing consumption patterns of Indian population.
•    Emerging scope for functional foods, geriatric foods, low fat foods, etc.
•    Opening of global markets
•    Rationalisation of food laws and enabling policies of GoI and State Governments for development of the sector.
•    Increased demand for ethnic food in most of the countries due to increased NRI population in those countries.
4.    Threats
•    Preferences for fresh food than chilled or frozen
•    Competition from other countries / players

Gujarat is tagged as the most ‘investor friendly’ state of India, tops in food processing (combining dairy, agro, poultry and fisheries) with substantial growth rate and thereby granting opportunities for development of small scale food processing units.

(Indani is head food safety-regulatory advisor-trainer. Shah is a food safety advisor-trainer. They can be reached at safefoodz@gmail.com)
 
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