The food processing industry in India witnessed a 30% decline in foreign direct investment (FDI) to Rs. 5,037.06 crore in the last fiscal year, according to official data. This marks a significant drop from the previous year’s FDI of Rs. 7,194.13 crore.
The Food Processing Industries Ministry submitted data to the Lok Sabha, revealing that FDI in the sector has been declining over the past few years. In FY22, FDI stood at Rs. 5,290.27 crore, while in FY21, it was Rs. 2,934.12 crore.
The ministry has implemented various initiatives to boost foreign investment in the food processing industry, including allowing 100% FDI through the automatic route and exempting processed food items from licensing requirements.
Despite these efforts, FDI in the sector has declined, attributed to global economic factors such as the Bank of Japan’s interest rate hike and recession fears in the US.
The government has launched several programs to promote the growth of the food processing industry, including the Pradhan Mantri Kisan SAMPADA Yojana, the Production-Linked Incentive Scheme for the Food Processing Industry, and the Prime Minister’s Formalisation of Micro Food Processing Enterprises program. These initiatives aim to build state-of-the-art infrastructure, improve farmer returns, and increase processed food exports.
Key Highlights:
- FDI in the food processing industry declines by 30% to Rs 5,037 crore in 2023–24.
- Previous year’s FDI stood at Rs 7,194.13 crore.
- The Ministry implements initiatives to boost foreign investment.
- Global economic factors contribute to the decline in FDI.
- The government launches programs to promote industry growth.