'India needs Rs 1 lakh cr investment in food processing'

India needs an investment of almost Rs 1 lakh crore in the food processing industry to raise its percentage to 25 per cent of the total agricultural produce annually.

“The second green revolution will not be successful unless the imperatives of post harvest management and value addition mechanism in agriculture are adopted in right earnest,” Union Minister for Food Processing Subodhkant Sahai told Business Standard here.

He said the percentage of food processing industry was as high as 80-85 per cent in developed economies vis-à-vis under 10 per cent in India.

“Even the developing countries in Asia like Thailand and Philippines have brought about a transformation in their economies by developing robust food processing infrastructure,” he added.

Sahai further suggested that the state governments should encourage contract farming on the lines of sugarcane to boost agriculture and allied industries.

“The contract farming would allow the market to invest in agriculture, water management and food processing. This way, the farmers would not shoulder any economic risk and will have the liberty to fix prices for their produce,” he said.

He said rural prosperity and industrialisation was the only solution to check migration to bigger towns.

He, however, lamented the Northern states in general were lax in adopting and investing in food processing industry.

Besides, he claimed that in the last 6 years, not a single demand had come to his department from the Uttar Pradesh government regarding food processing sector.

“We have given a lot of support to the private entrepreneurs in UP, but the state government has not sought our help,” he added.

The minister exhorted the state governments to frame separate policies for food processing industry, keep tax regime benign at 0-4 per cent and amend the Agriculture Produce Marketing Committee (APMC) Act.“The respective state governments should create conducive environment for private investment in food processing, which would not only lead to higher agriculture production, but better prices to farmers,” he noted. Sahai was here as chief guest at inaugural function of the national conference on Managing Agri-food Supply Chain organised by IIM Lucknow in association with Indian Society of Agribusiness Management.