Govt, RBI in talks to allow easy credit to food processing units

A sum of Rs 500 cr set aside from a special fund created to deploy funds in Nabard

The Union ministry of food processing industries (MoFPI) is in talks with the Reserve Bank of India (RBI) to allow refinancing to the banks of the 'special fund' created to give affordable credit to food processing units coming up at the designated food parks.

The RBI created a Rs 2,000-crore fund for deployment in the National Bank for Agriculture & Rural Development (Nabard).

"A sum of Rs 500 crore has been sanctioned out of the special fund. Out of that sanctioned amount, Rs 150 crore has been disbursed. The take off is slow because the fund is restricted to mega food parks and other upcoming units in Odisha, which the Nabard is directly sanctioning," said JP Meena, secretary, the ministry of food processing industries in Bhubaneswar.

"We are in talks with RBI to allow Nabard to refinance it so that other banks can also avail it", he added.

Only the designated food parks and the individual processing units in those food parks are eligible for financial assistance from the fund. The designated parks will include food parks and mega food parks promoted by the ministry as well as other food parks and industrial estates promoted by the state governments.

As per the MoFPI website, as many as 175 parks have been notified as designated food parks that can avail the concessional credit from Nabard.

Speaking on the sidelines of a roadshow on the World Food India 2017, he said the food processing sector is poised to attract an investment of around Rs 60,000 crore in the next three years.

The 'Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters' (SAMPADA) of the ministry alone is expected to attract an investment of Rs 31,400 crore.

For attracting investment in the food processing sector, the ministry is organising the event in Bhubaneswar along with the Confederation of Indian Industry (CII). 

Around 300-400 companies are expected to participate in the three-day event that is scheduled to take place from November 3 to 5 in 2017. Italy has been confirmed as a focus country of the summit this year, with other partner countries expected to join in and explore the so-called 'farm-to-fork' food processing value chain in India.

While Andhra Pradesh and Madhya Pradesh will be among the partner states for the event, states like Odisha, West Bengal and Kerala will participate as the focus states. As many as 47 international companies have confirmed their participation in the event.