Topic 04

Topic 04

Topic :-  Constraints and Challenges in the food processing industries

Syllabus:-Food Processing and Related Industries in India- Scope’ and Significance, Location, Upstream and Downstream Requirements, Supply Chain Management.

What are the challenges faced by the food processing industries in India? Mention some measures adopted by government to revive the sector. (150 words, 10 marks)


§  Introduction:- briefly give an idea regarding food processing and it’s ststus in india.

§  Body:–  Keyword (‘Mention’ – challenges faced by the food processing industry and measures taken by the government to counter it)

§  Conclusion:- Describe how the  potential  of the  food processing sector to help economic growth of  farmers.




Food processing is a series of methods that seeks to convert raw materials into value-added food for the consumption of humans and animals. The food processing industry is considered as a sunrise sector, whose true potential is yet to be exploited.


  • Challenges faced by food processing industries:-

These challenges include lack of:-

  • Access to the institutional credit.
  • Access to modern technology & equipment
  • Lack of branding & marketing skills.
  • Issues in meeting health and safety standards.
  • Infrastructure bottlenecks: inadequate warehouse and cold storage facilities.
  • Logistics bottlenecks: issues with road connectivity leads to delay in transportation of farm produce which leads to wastage of food materials especially perishable goods.
  • Demand-side issues: demand for processed food is mainly restricted to urban areas of India.
  • The skill gap in the industry.
  • Regulatory issues: Incoherent central and state laws disincetivize investments in the sector.

Measures adopted by the government

  • Establishment of Agri-zones and mega food parks
  • Sampada Scheme(Scheme for Agro Marine Processing And Development of Agro-processing clusters): It is an umbrella scheme to supplement agriculture, modernize food processing and decrease agro-wastage
  • As part of the Atma Nirbhar Bharath Scheme, the union cabinet recently approved the Scheme for Formalization of Micro food processing Enterprises (FME)
  • The newly enacted Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 promotes contract farming between processing industries and farmers.
  • The upgrading of 22,000 rural haats into Gramin Agriculture Markets (GrAMS),announced in the 2018-19 Budget, promotes village-level procurement centers for perishables such as fruits, vegetables, and dairy.
  • The introduction of a product-linked incentive(PLI) scheme in this sector will boost the inflow of foreign direct investment(FDI).


Thus, Food processing industries have enormous potential to alleviate rural distress and meaningful concessions and incentives are needed from the part of the government so that it will also act as an important link in doubling the farmer’s income.



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