Food Products

The Indian Food Products sector is one of the biggest in the country in terms of expansion, output, use, and overseas sales. The sector manufactures a variety of food items like meat, poultry, fish, fruits, veggies, spices, dairy products, alcohol, crops, and grains. It also produces cocoa goods, chocolates, sweets, bottled water, soy products, and high-protein foods. After the liberalization in August 1991, the government has suggested and approved various initiatives, such as forming partnerships with foreign companies, establishing joint ventures, setting up 100% export-focused units, and issuing industrial licenses to boost development and investment in the food processing sector. India's foreign direct investment (FDI) was calculated at Rs. 2,934.1 crore (equivalent to US$ 368.8 million) during FY21.

India is a significant player in global food production, boasting a large and expanding market. In 2021, the food and grocery retail market is worth US$ 11.3 trillion and stands as one of the biggest sectors in the worldwide economy.

In recent years, the food processing industry in India has become increasingly important as a growing sector. India exports various processed food products such as fruits, juices, pulses, guar gum, groundnuts, milled products, cereals preparations, oil meals, and alcoholic beverages. In FY22, India achieved a milestone in agricultural and processed food exports, making history by exporting items valued at US$ 25.6 billion. As of April-June 2022, the export of APEDA products increased by 31% to reach US$ 7.4 billion, compared to US$ 5.7 billion during the same period in the previous fiscal year, as the Directorate General of Commercial Intelligence and Statistics reported. In addition, there was a 59.1% increase in exports of processed fruits and vegetables; cereals and miscellaneous processed items saw a 37.66% growth; meat, dairy, and poultry products experienced a growth of 9.5%; basmati rice grew by 25.5%; non-basmati rice increased by 5%; and miscellaneous products had a growth of 50%.

The Indian food ecosystem has huge investment potential, driven by the stimulating growth of the food retail sector, encouraging economic policies, and attractive fiscal incentives. The Government of India, through the Ministry of Food Processing Industries, is undertaking all measures necessary to attract investments in the food processing industry in the country. These initiatives include:

• Pradhan Mantri Kisan Sampada Yojana aims at the development of modern food processing infrastructure in the country. PMKSY has been conceptualized as an umbrella program blending the ongoing schemes of the Ministry of Food Processing Industries (MOFPI) for creating modern infrastructure with efficient supply chain management from farm gates to retail outlets.
• The Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) Scheme aims to enhance existing individual micro-enterprises in the unorganized segment of food processing industries.
• PLISFPI, the Production Linked Incentive Scheme for the Food Processing Industry, would support domestic manufacturing with stipulated sales and a willingness to invest for the expansion of processing capacity and branding abroad so that strong Indian brands could be incentivized for their emergence. The scheme is EoI-based.
• Exports of agricultural and processed food products from India rose 13 percent to $19.69 billion during the nine months of the current fiscal (2022-23) compared to the corresponding period last year.

India's food industry is currently in the process of transition. The Agricultural and Processed Food Products

The food products industry in India is a significant and rapidly growing sector, contributing substantially to the country's economy. Here are some key aspects and trends:

• Economic Contribution: The food processing industry constitutes a significant part of India's economy. It is likely to reach USD 535 billion by 2025-26.
• Employment Generation: The sector is likely to employ 9 million people by 2024, underpinning its importance in generating employment.
• Investment: USD 4.18 billion FDI was attracted to the food sector in India between April 2014 and March 2020.

• Rising Urbanization and Income: Increasing urbanization and rising incomes result in increasing demand for processed and packaged foods.
• Loose to Branded: Due to consumer expectations of hygiene and convenience, a clear shift from loose to branded packaged products has been seen 
• Health Trends: With increasing health awareness, there is a growing demand for healthy, packaged, and immunity-boosting foods inland.

• Mega Food Parks and Cold Chain Projects: "The government has established 18 mega food parks and 134 cold chain projects for the food processing supply chain."
• Make in India: Under the initiative, the food processing sector finds a place at the top of the list and is provided with investments and growth.
• Production-Linked Incentive Scheme: The scheme supports the sector with financial incentives to boost production and efficiency.

• Between 2014 and 2018, the food processing industry in India experienced an average annual growth rate of around 8.4%.
• Around 10.7% of the agriculture sector and 8.8% of the manufacturing sector's gross value added comes from the food processing industry. According to the Annual Survey of Industries 2018-19, the food items
• The manufacturing sector comprised 15.8% of all factories, contributed 8.9% of worker wages, and accounted for 11.2% of employees.
• The Indian food industry's estimated output will be US$ 535 billion by the fiscal year 2026. The primary factors driving growth for this are the rise in urbanization, increase in household income, and expansion of the organized retail industry sector production of fruits and vegetables cultivation of food, vegetables, fruits, and fish.
• The Indian food processing sector is developing quickly. The industry has experienced various transformations from shifting consumption habits, increasing urbanization, shifts in employee gender makeup, and a rise in food intake. Indians nowadays enjoy trying out different food cuisines alongside their traditional Indian dishes. Because of these reasons, it is anticipated that the food sector in India will achieve a revenue of US$ 1.2 trillion by FY26.

The food products industry in India is poised for robust growth, supported by favorable economic conditions, consumer trends, and government policies. This sector’s expansion not only contributes to the economy but also plays a crucial role in ensuring food security and nutrition for the growing population.

Corpseed offers comprehensive suite of services ensures that businesses in the food products industry can focus on growth and innovation while maintaining compliance with all relevant regulations and standards.