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| Ficci for national bank like Nabard to boost food processing |
| Press Trust of India / New Delhi Aug 29, 2010, 12:06 IST |
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Identifying food processing as a sunrise sector, industry body Ficci has recommended setting up a bank on the lines of the agriculture cooperative, Nabard, and promoting contract farming to boost growth.
"The government should establish a national bank on the lines of Nabard to lend credit to food processing industries whose tremendous potential remains untapped," a Ficci report said.
The bank will ensure speedy disbursals of the funds to the sector grappling with the issue of lack of access to credit from banks, Ficci said on the basis of a comprehensive survey.
Survey-2010 on bottlenecks in Indian Food Processing Industry was conducted on 250 companies.
To overcome the long and fragmented supply chain, contract farming can emerge as a significant opportunity for companies, whereby they can create direct farm linkages to source appropriate quality, quantity and varieties of inputs, the report said.
It also recommended opening up multi-brand retail to bring in more global investments in the infrastructure and logistics domain.
"Multi-brand retail is an easier way of creating ideal environment for the use of modern logistics infrastructure like transportation, hubs, IT, cold chain," it commented.
Ficci, which works closely with the government on policy issues, observed that despite food and food products forming the largest consumption category in India involving 21 per cent of the country's gross domestic product, its growth potential remains untapped.
Notwithstanding government undertaking several steps, including rationalisation of food laws, setting up mega food parks and allowing 100 per cent FDI in the food processing & cold chain infrastructure, the sector continues to be at a nascent stage, the report said.
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