About Us

MINISTRY OF FOOD PROCESSING & INDUSTRIES The Ministry of Food Processing Industries, set up in July 1988, is the main central agency of the Government responsible for developing a strong and vibrant food processing sector; with a view to create increased job opportunities in rural areas, enable the farmers to reap benefit from modern technology, create surplus for exports and stimulating demand for processed food. SUBJECTS HANDLED BY The subjects looked after by the Ministry are:

THE

MINISTRY:

Fruits and vegetable processing industry Food grain milling industry Dairy products Processing of poultry and eggs, meat and meat products Fish processing Bread, oilseeds, meals (edible), breakfast foods, biscuits, confectionery (including cocoa processing and chocolate), malt extract, protein isolate, high protein food, weaning food and extrude/other ready to eat food products. Beer, including non-alcoholic beer Alcoholic drinks from non-molasses base Aerated waters / soft drinks and other processed foods Specialized packaging for food processing industries Technical assistance and advice to food processing industry

Goals MOFPI

The Ministry of Food Processing Industries is the nodal Ministry of the Government of India for Food Processing Sector in India. In the era of economic liberalization where the private, public and co-operative sectors are to play their rightful role in development of food processing sector, the Ministry acts as a catalyst for bringing in greater investment into this sector, guiding and helping the industry in a proper direction, encouraging exports and creating a conducive environment for the healthy growth of the food processing industry. With this overall objective, the Ministry aims at: Better utilization and value addition of agricultural produce for enhancement of income of farmers. Minimizing wastage at all stages in the food processing chain by the development of infrastructure for storage, transportation and processing of agro-food produce. Induction of modern technology into the food processing industries from both domestic and external sources. To encourage R&D in food processing for product and process development and improved packaging. To provide policy support, promotional initiatives and physical facilities to promote value added exports. Roles MOFPI

The functions of the Ministry can be broadly classified under policy support and development activities: Policy Support a) Formulation and implementation of policies for food processing sector with overall national priorities and objectives. b) Facilitating creation of a conducive environment for healthy growth of the foodprocessing sector. c) Promoting rationalization of tariffs and duties relating to food processing sector. POLICY INITIATIVES Several policy initiatives have been taken from time to time promote growth of the processed food sector in the country. Some of these are: a) Most of the processed food items have been exempted from the purview of licensing under the Industries (Development & Regulation) Act, 1951, except items reserved for small-scale sector and alcohol beverages. b) Food processing Industries were included in the list of priority sector for bank lending in 1999. c) Automatic approval for foreign equity upto 100% is available for most of the processed food items excepting alcohol and beer and those reserved for small sector subject to certain conditions. d) Excise duty on processed fruits and vegetables has been brought down from 16% to zero level in the Budget 2001-02. e) In the budget of 2004-05 Income Tax holiday and other concessions were announced for certain categories of food processing industries. f) In the Budget 2006-07 Excise Duty has been waived on condensed milk, ice cream, preparations of meat, fish and poultry, pectins, pasta and yeast. Excise Duty on ready to eat packaged foods and instant food mixes, like dosa and idly mixes have been reduced from 16% to 8%. Excise Duty on aerated drinks has been reduced from 24% to 16%. Fruits and vegetable processing units are already exempted from payment of Excise Duty. g) To ensure easy availability of credit, Government has included food processing industries in the list of priority sector for bank lending. NABARD has created a refinancing window with a corpus of Rupees one thousand crore for agro processing

infrastructure and market development. h) In Budget 2007-08 Excise Duty has been waived on all kinds of food mixes including instant mixes, soya bari (food supplement) and ready to eat packaged foods and on biscuits. i) Excise Duty on reefer vans (refrigerated motor vehicles) has been reduced from 16% to 8%. j) Exemption limit of Excise Duty for small scale industry has been raised from Rs 1.00 crore to 1.50 crores. k) Customs Duty on refrigerated motor vehicles has been waived while Customs Duty on food processing machinery reduced from 7.5% to 5%. Customs Duty on sunflower oil (crude) reduced from 65% to 50% and on sunflower oil (refined) reduced from 75% to 60%. l) Special additional duty of 4% has been waived in the case of refined edible oil. m) All services provided by Technology Business Incubators and their Incubatees whose annual business turnovers do not exceed Rs. 50 lakhs have been exempted from Service Tax for the first three years. (n) Budget Announcement of 2010-11: (i) A strong supply chain for perishable from produce to reach consumption and processing centres promptly. (ii) Infrastructure and technology to convert such produce into value-added products; and (iii) Infusion of technology to augment agricultural production. Similar attention needs to be paid to related sectors such as apiary, horticulture, dairy, poultry, meat, marine and aquaculture. For achieving these objectives, it is proposed to provide: Project import status with a concessional import duty of 5 percent for the setting up of mechanized handling systems and pallet racking systems in `mandis` or warehouses for food grains and sugar as well as full exemption from service tax for the installation and commissioning of such equipment. Project import status at a concessional customs duty of 5 percent with full exemption from service tax to the initial setting up and expansion of Cold storage, cold room including farm pre-coolers for preservation or storage of agricultural and related sectors produce ; and Processing units for such produce. Full exemption from customs duty to refrigeration units required for the manufacture of refrigerated vans or trucks. Concessional customs duty of 5 percent to specified agricultural machinery not

manufactured in India; Central excise exemption to specified equipment for preservation, storage and processing of agriculture and related sectors and exemption from service tax to the storage and warehousing of their produce; and Full exemption from excise duty to trailers and semi-trailers used in agriculture. Development Initiatives a) Providing assistance under various Plan Schemes to food processing industries. b) Widening the R & D base in food processing by involvement of various R & D institutes and support to various R & D activities. c) Human Resource Development to meet the growing requirement of managers, entrepreneurs and skilled workers in the food processing industry. d) Assistance for setting up analytical and testing laboratories, active participation in the laying down of food standards and their harmonization with international standards. e) Ministry is setting up a national level institute called National Institute of Food Technology Entrepreneurship and Management (NIFTEM) at Kundli in Haryana. The Institute will be of international standards. The Institute will start functioning from academic year beginning from 2010. f) Sevottam, charter mark in service delivery for excellence is being introduced in the Ministry. g) An integrated Food Law i.e. Food Safety and Standards Act, 2006 has been notified on 24.08.2006. The Act will enable in removing multiplicity of food laws and regulatory agencies and will provide single window to food processing sector. Ministry of Health & Family Welfare has been designated as the nodal Ministry for administration and implementation of the Act. h) Decentralisation of processing and disbursement of grant under scheme for technology upgradation/ expansion/modernization of food processing industries through bank/ financial institutions. i) Creation of World Class Infrastructure for growth of food processing sector through mega Food Parks, integrated cold chain & modernization of abattoire schemes.

Promotional Initiatives In order to create awareness about the potential and prospect of Food Processing

Industries in the country, this Ministry provides assistance for:a) Organizing Workshops, Seminars, Exhibitions and Fairs. b) Studies/ Surveys etc.
Vision of MOFPI

This Ministry aims at building a sector which: Provides safe, hygienic and quality food products to the people Make available nutritious food items to larger sections of the people Build a competitive and highly productive industry Promote awareness of hygiene and safety issues relating to food and availability of choice to the consumers Development of a knowledge based industry which promotes high value addition and through that, higher incomes and employment in the economy Bring the benefits of urbanization to the agricultural sector and promote modernization of agriculture as an essential component of a strong and expanding economy

Mission of MOFPI To achieve its Vision - Ministry of Food Processing industries will facilitate:

Creating of Critical rural infrastructure of fill the gaps of the supply chains linking the farmers to the consumers. Higher level of preservation, processing and value addition to agri-horticultural produce. Raise the level of hygiene and safety of food items. Minimise wastage at all stages in the food chain by developing infrastructure for storage, transportation and processing. Induction of modern technology into food processing industries. Encourage research and development for product and process development and promote innovation. Provide policy support and promotion of value added exports. Human Resource Development to support a fast expanding food processing sector. Preserving and enhancing the variety of cuisine, dietary habits and tastes in the country. Enable the grower to play an increasingly important role in the production. Leverage the strength of village and decentralized markets for the benefit of small farmers and consumers. Promote standards of quality and food safety and implementation of the Food Laws to support a competitive, modern and safe food sector.

The Food Processing Sector

Food processing adds value to the agricultural produce starting at the post harvest level. It includes even primary processing like grading, sorting, cutting, seeding, shelling packaging etc.

The sector comprises of the following major areas:

Fruit & Vegetable The major products processed out of fruits and vegetables include beverages, juices, concentrates, pulps, slices, frozen and dehydrated products, wine potato wafers or chips etc. Apple Apple without skin, cooked, canned apples, dehydrated apples, frozen apples, canned apple juice, apple juice, apple sauce. Banana Banana Powder, Banana Flour, Banana Puree, Banana Chips, Banana Jam and Banana Jelly, Banana vinegar, Sweet coat banana. Grape Jam, Juice, Syrup, Squash, Wine and Raisins. Guava Pectin, Jam, Jelly, Pickle, Powder, Puree, Peru khand, Beverages, Ethanol Production, Wine and Animal Feed preparation. Lychee Lychee crush, juice, squash, pickles, canned and dried fruits. Mango Juice, squash, nectar, jam, pulp, puree, pickles, canned slices, mango leather (papad), starch from mango kernel. Papaya Papain, Jam, Marmalade, Tutti-frutti (candy), Pickle, Wafers (Papad), Chocolate, Canned papaya, Fridge dried papaya. Pineapple Canned Pineapple Juice, Pineapple Squash, Pineapple beverage, Canning Syrup from Pineapple Waste Juice, Preparation of Vinegar from Pineapple Wastes, Cattle Feed Ingredient, Pineapple Bran, Pineapple Silage, Pineapple Tops (Crowns), Waxes, Pineapple Proteases (Bromeliad), Pineapple Fibre. Pomegranate Pomegranate Juice, Jelly, Syrup, Squash, Nectar, Anar rub, Anar crush, Dried pomegranate (Anar Dana), Powder, Pomegranate wine.

Sapot Chikku Juice, Squash, Syrup, Jam, Toffee, Candy, Dried Fruit Scrap and Powder, Milk Shake, Ice cream. Watermelon Juice. Fruits and Vegetables Consumer Products Fruit Toffees Fruit toffee is made from pulp of various fruits along with certain food preservatives and ingredients. Small and cottage scale manufacture of fruit toffee provides self-employment in the area where the fruits widely available. Although fruit toffees are being made in the organised sector still there exists a vast potential for cottage scale production. Fruit Bars Fruit bar is a concentrated fruit product, which has a good shelf life. A variety of pulpy fruits like mango, banana, guava, papaya, apple etc. can be used in preparing fruit bars. Due to their good shelf life, availability in various flavors and texture fruit bars are becoming increasingly popular. Fruit Jams and Jellies Fruit jams and jellies are prepared by boiling the fruit pulp with sufficient quantity preservative like sugar to a moderately thick consistency. The popular varieties of jam include mixed fruit, pineapple, mango, strawberry, grape, apricot and among jellies, guava and apple. The jam is used as a bread spread and could be taken along with paranthan, chapatti and puri. Jams, jellies and marmalades contribute around 17% of the total processed fruit and vegetable products. Improved Murabba Making Murabba comes under indigenous sweet preparations of the country. Murabba could be prepared from amla, mango, bael, myrobalan, carrot, apple also citrus peels are quite popular. The traditional method of preparing murabba requires a long processing time and does not ensure good keeping quality for the product often spoils due to miocrobial fermentation. The method has been improved to obtain murabba in a shorter period with good keeping quality, attractive translucent appearance and desirable texture. Tutty Fruity Fruits like apple, mango, amla, papaya, strawberry, raspberry, pear, cherry, etc are used in preparing preserves or candies. Raw papaya is largely used to make tutti-fruity used in bakery products, sweetmeats, ice creams, salads and pan. The candied fruits and vegetables are quite popular food items and their consumption of is rapidly increasing. Osmo-air dried Fruits Osmo air-dried fruits are based on a novel approach towards dehydration. Slices of various fruits like ber, pineapple, jackfruit, mango, etc. are processed in two stages. In the first phase most of the water is removed using sugar syrup as an osmotic agent. In the second phase air drying is done where the moisture content is further reduced to about 15%. The osmo-air dehydrated product is near to the fresh fruit in terms of colour, flavour and texture. The osmo-air dehydrated product can be used in ready-to-eat type foods, ice cream, fruit salad, kheer, cakes and bakery products. Such osmo-air dried fruit based units

can be set up in areas near fruit orchards to the benefit of people. The process is simple and involves operations like selection of fruits, cleaning, washing, peeling, curing and slicing and dicing. To remove water by osmosis the prepared fruit slices are steeped in sugar solution. The slices are then drained, dried in a hot air drier and finally packed in flexible pouches. Grape Raisins Dried grapes are used in various food preparations and are directly consumed. Grape growing area has the potential of manufacturing raisins. An effective and improved method to prepare raisins has been developed which can easily be adopted. This process consists of washing of grape, alkali treatment, sulphitation, drying in sun or in dehydraters. Any grape variety with high sugar and low acid content can be used yielding a good quality product. No sophisticated equipment is needed and the unit can be installed in orchards generating rural employment. Dry Apricots Apricot is grown in the temperate regions. The dry fruit form of apricot is an important item of confection. The fully ripe fruits are harvested item of confection. The fully ripe fruits are harvested and placed in a wooden sulfuring chamber wherein yellow sulphur is burnt at the rate 4g per kg of fruit. Sulfured fruits are then dried in a solar drier for 5-7 days till the moisture content is about 17%. Finally the dry fruits are packed in polythene bags for storage and marketing. Dehydrated Vegetables Dehydration is one of the methods to preserve seasonal and perishable vegetable and make them available throughout the year in hygienic conditions at reasonable or low cost. Such dehydrated vegetables are easy to transport and cater to the needs of large catering establishments. The advantage of such dehydrated vegetables can be used in various preparations at any season of the year. Traditional sun drying is time consuming, less hygienic and climate dependent. The process for controlled dehydration of vegetables consists of grading and sorting, washing, peeling and trimming, size reduction, blanching, chemical treatment, dehydration and packing in unit can be established. Anardana Anardana is pomegranate seed. The seed when dried yields anardana of commerce. The anardana is manually extracted of arils followed by sundrying. It is unhygienic, labour intensive and slow. The product cannot be stored for long or beyond monsoon season since spoilage occurs due to discolouration, moisture ingress and insect infestation. The modern processing technique is hygienic and consists of pre-cleaning, mechanised extraction of arils, solar drying and packaging. The mechanised aril extractor works on HP motor and can process 60 kg fruit per hr as compared to productivity of 5 kg per hr in manual operation. Fisheries Under this category, frozen and canned products mainly in fresh form is presented. Meat and Poultry It is frozen and packed mainly in fresh form. Egg is also processed into egg powder in a couple of units. Grain and Cereals

Flour, bakeries, biscuits, starch glucose, cornflakes, malted foods, vermicelli, pasta foods, beer and malt extracts, parched rice, flaked rice, rice starch, alcoholic beverages, Bran oil grain-based alcohol are some of the products which is processed food under grain and cereals. Milk and Dairy Whole milk powder, Skimmed milk powder, Condensed milk, Ice cream, Butter and Ghee are some of the processed products under dairy. Processed Milk

Skimmed milk Skimmed milk is prepared by removing the fat, vitamin A and other fat-soluble vitamins from whole milk. The fat is removed by using a cream separator. After the removal of fat the milk is suitable for many therapeutic conditions like, diabetic, obesity, high cholesterol, heart diseases, hypertension etc. Skimmed milk has only 2.5gms of protein, 29kcal of energy, 120mgs of calcium, 90mgs of phosphorous and most importantly fat be only 0.1gms per 100ml. Toned milk Toning can be defined as the addition of the constituted skim milk to whole buffalo milk so to reduce the fat to 3%. The nutritive value of toned milk is almost similar to that of the fresh cow's milk. Toned milk is useful source of protein for certain conditions such as malnourishment, pregnancy etc. Doubled toned milk Double toned milk is prepared by mixing cow's milk or buffalo milk with fresh skim milk or skim milk reconstituted from skim milk powder so that the fat content is not less than 1.5%. Except for lower fat and vitamin A contents the nutritive value of double toned milk is similar to that of toned milk. Standardized milk

Standardised milk is prepared from buffalo milk or a mixture of buffalo and cow's milk by mixing with skim milk so that the fat content of the mixture is reduced to 4.5%. Its nutritive value is almost similar to that of cow's milk. Sweetened condensed milk Sweetened condensed milk contains about 40% sucrose but the concentration of milk solids is nearly the same as in evaporated milk. Because of its high sucrose content it is not suitable for feeding infants. It is used for the preparation of pudding, coffee, and tea. It has to be reconstituted with water before consumption if required. Malted milk or powder Malted milk powder is prepared from whole milk and malt extract. It contains 15% proteins and 7% fat. It can be used as food for invalids and convalescents and as supplement to the diets of children as well as for adults. But it is not suitable for feeding infants. Milk products can be unfermented and fermented products which includes all types of milk, cottage cheese (paneer) whey, curd, skimmed milk powder, cream, malai, khoya, yoghurt, butter milk, butter and cheese. Skimmed milk powder Dried and packed milk could be preserved for longer time it can be dried and packed. To prepare skimmed milk powder a thin layer of milk is run over heated cylinder, which is called as roller or drum process. The dried powder is removed by scraping. The other method to prepare the skimmed milk powder is spray process in which minute droplets of milk are sprayed into a heated chamber and powder falls to the bottom. To reconstitute this powder into milk one part of the powder is added to eight parts of water. This milk is deficient in fat and fat-soluble vitamins but the proteins, water-soluble vitamins, and minerals are preserved. Other Milk Products Cream The fat, which floats to the surface of milk when allowed to stand for several hours are cream. Commercially it is separated by centrifugation. Nature of milk cream Description Fat % Half cream Single cream Sterilised cream Whipping cream Double cream 12 18 23 35 48 Energy kcal per 100gms 133 185 227 329 439

Clotted cream

55

500

Malai (clotted cream) Allowing the boiled milk to cool for some time a thick layer of fat and coagulated proteins collect at the surface. Most of the fat could be removed by repeating the process. Buffalo milk is considered to be ideal as it is richer in fat, produces better malai. Khoya Khoya is a milk product in which the water content is reduced to between 20 and 25 percent. It is prepared by vigorously boiling and stirring milk continuously. Khoya forms a uniform mass containing fats heat coagulated proteins and lactose. It can be stored for about 3-5 days and with the addition of sugar can be kept longer. It can be eaten as such or used for preparing sweets. Khoya provides 20% protein, 25% fat, and 413kcal of energy per 100 gms. Paneer (cottage cheese) Paneer is prepared by adding citrus or lemon juice to boiling milk. Commercially theprevious residual paneer liquid is used which precipitates casein, lactalbumin, and fat. It is then strained through a cloth and paneer is collected. It is not a fermented product of milk so it cannot be ripened like cheese as boiling destroys all the organisms. Paneer supplies 15% protein, 22%fat, 5% carbohydrate, and 280kcal of energy per100gm. Curd Curd is a sour milk preparation regularly made and highly consumed in Indian homes. Dahi or curd is eaten as such with salt or sugar or added to other preparations. The butterfat is removed from dahi by churning and used to make ghee. The calorific value of curd is same as cows milk. 40 percent of lactose is converted to lactic acid. It has 3.1 gms of protein, 4gms of fat, 149mgs of calcium, and 93mgs of phosphorous.

Exporters Of Fruit & Vegetables

(Quantity in MT, Value in Rs Mn) 2001-02 Quantity Value Dried & Preserved Vegetables 209157.8 5371.5 Mango Pulp 76735.18 2413.4 Pickles & Chutney 38758.97 1203.4 Other Processed Fruits & Vegetables 61332.39 2017.4 Total 385984.3 11005.7 2004-05 Quantity Value 351034.3 7657.5 90988.6 3008.6 67193.29 1205.8 80760.5 2755.3 589976.7 14627.2 CAGR Quantity Value 18.8 12.5 5.8 7.6 20.1 0.1 9.6 10.9 15.2 9.9

Source: Ministry of Food Processing Industries, Annual Report 2005-06

The domestic industry has to change its preference in favour of processed foods. Consumption of value added fruits and vegetables are low compared to the primary processed foods, and fresh fruits and vegetables. The inclination towards processed foods is mostly visible in urban centers due to a high purchasing power.

A remarkable push can be given to this sector by strengthening linkages between farmers and food processors. The poor and weak linkage between farmers and markets, as well as, farmers and processing companies has brought about inefficiencies in the supply chain and encouraged the involvement of middlemen leading price rise to the products. The Government of Indias National Agriculture Policy envisages the participation of the private sector through contract farming and land leasing arrangements which not only assures supply of raw material for processing units, but also a market for agriculture produce, accelerate technology transfer and capital inflow into the agriculture sector. Innovative practices like contract farming in wheat practiced in Madhya Pradesh by Hindustan Lever Ltd and by Pepsi Foods Ltd in Punjab for tomatoes, food grains, spices and oilseeds are some successful examples of contract farming in India, which changed the farming landscape and promoted the cultivation of processable variety of farm produce this will certainly power the fruits, vegetables and grain processing industry. Besides such initiatives, fiscal incentives and tax concessions will also give impetus to the sector. The five-year 100% tax exemption announced by the Government in the finance year 2005 was one such incentive for upcoming fruits and vegetable processing units.

Why to invest in Food Processing Sector

1. Vast source of raw material India is one of the largest producers of wheat and rice. Coconuts, cashew nuts, ginger, turmeric and black pepper is widely grown in some parts of the country. India is the second largest producer of groundnuts, fruits and vegetables. That it accounts for about 10 per cent of the world's fruits production with the country topping in the production of mangoes and bananas. Due to the high processing levels milk products offer a significant opportunity in India. India is the world's largest producer of milk owing to the strong business models formed through cooperative movements in the country. Milk and related products account for 17% of India's total expenditure on food. This segment enjoys liberal regulations as all milk products except malted foods are automatically allowed 51% foreign equity participation and all exports of dairy products are freely allowed. Alcoholic beverages have been categorised as the new high opportunity sector in India. Liquor manufactured in India is categorised as Indian Made Foreign Liquor (IMFL). The sector is still barred from the import of potable alcohol as it is subject to government licensing. In the meanwhile, India has recently started producing wine for domestic consumption. Meat and poultry has also gained popularity due to the emergence of producers that have integrated breeding, feed milling, contract growing and marketing facilities for improved productivity. Meat, fish, and poultry are in rural areas as they are easily affordable and provide necessary nutrients. India has the potential to be a leading global food supplier if it employs the right marketing strategies and creates an efficient supply chain 2. Conventional farming to commercial faming In recent years, there has been a shift from conventional farming of food grains to horticulture which include fruits, vegetables, ornamental crops, medicinal and aromatic plants, spices, plantation crops which include coconut, cashew nuts and cocoa and allied activities

3. Market in the form of large urban middle class With a huge population of 1.08 billion and population growth of about 1.6 % per annum, India is a large and growing market for food products. Its 350 million strong urban middle class with its changing food habits poses a huge market for agricultural products and processed food. 4. Low Production cost The relatively low-cost but skilled workforce can be effectively utilised to set up large, low-cost production bases for domestic and export markets. 5. Change in consumption patterns Increasing incomes are always accompanied by a change in the food habits. Over the last three decades in India a shift in food habits have been observed. The report observes that the proportionate expenditure on cereals, pulses, edible oil, sugar, salt and spices declines as households climb the expenditure classes in urban India while the opposite happens in the case of milk and milk products, meat, egg and fish, fruits and beverages. For instance, According to report of ICRA the proportionate expenditure on staples like cereals, grams and pulses declined from 45 per cent to 44 per cent in rural India while the figure settled at 32 per cent of the total expenditure on food in urban India. A large part of this shift in consumption is driven by the processed food market, which accounts for 32 per cent of the total food market. It accounts for US$ 29.4 billion, in a total estimated market of US$ 91.66 billion. The food processing industry is one of the largest industries in India -- it is ranked fifth in terms of production, consumption, export and expected growth. According to the Confederation of Indian Industry (CII) the food-processing sector has the potential of attracting US$ 33 billion of investment in 10 years and generate employment of 9 million person-days. 6. Government Assistance The Government has introduced several schemes to provide financial assistance for setting up and modernizing of food processing units, creation of infrastructure, support for research and development and human resource development in addition to other promotional measures to encourage the growth of the processed food sector. 7. Foreign Direct Investment Foreign direct investment (FDI) in the country's food sector is poised to hit the US$ 3-billion mark in coming years. FDI approvals in food processing have doubled in last one year alone. The cumulative FDI inflow in food processing reached US$ 2,804 million in March '06. In '05-06, the sector received approvals worth US$ 41 million. This figure is almost double the US$ 22 million approved in 2004-05. The US-based private equity fund, New Vernon Private Equity Limited (NVPEL), has decided to invest Rs 45 crore in Kochi-based spice major, Eastern Condiments, which is the flagship company of Eastern Group.

America's largest chocolate and confectionery-maker Hershey is acquiring 51 per cent stake in Godrej Beverages and Foods for US$ 54 million. 8. Food Parks In an effort to boost the food sector, the Government is working on agri zones and the concept of mega food parks. Twenty such mega parks will come are proposed across the country in various cities to attract Foreign Direct Investment (FDI) in the food-processing sector. The Government has released a total assistance of US$ 23 million to implement the Food Parks Scheme. It has so far approved 50 food parks for assistance across the country. The Centre also plans US$ 22 billion subsidy for mega food processing parks. 9.Conducive food processing policy environment The national policy on food processing aims at increasing the level of food processing from the present 2 per cent to 10 per cent by 2010 and 25 per cent by 2025. The government has allowed 100 per cent FDI in processing sector. The Policy will seek to create an appropriate environment for entrepreneurs to set up Food Processing Industries through: Fiscal initiatives and interventions like rationalization of tax structure on fresh foods as well as processed foods and machinery used for the production of processed foods. A concerted promotion campaign to create market for processed foods by providing financial assistance to Industry Associations, NGOs/Cooperatives, Private Sector Units, State Government Organization for undertaking generic market promotion. Harmonization and simplification of food laws by an appropriate enactment to cover all provisions relating to food products so that the existing system of multiple laws is replaced and also covering issues concerning standards Nutrition, Merit goods, futures marketing, equalisation fund etc. Efforts to expand the availability of the right kind and quality of raw material round the year by increasing production, improving productivity. Strengthening of database and market intelligence system through studies and surveys to be conducted in various States to enable planned investment in the appropriate sector matching with the availability of raw material and marketability of processed products. Strengthening extension services and to the farmers and co-operatives in the areas of post harvest management of agro-produce to encourage creation of pre-processing facilities near the farms like washing, fumigation, packaging etc. Efforts to encourage setting up of agro-processing facilities as close to the area of production as possible to avoid wastage and reduce transportation cost. Promotion of investments, both foreign and domestic. Simplification of documentation and procedures under taxation laws to avoid unnecessary harassment arising out of mere technicalities. Infrastructual Development The Policy will facilitate: Establishment of cold chain, low cost pre-cooling facilities near farms, cold stores and

grading, sorting, packing facilities to reduce wastage, improve quality and shelf life of products. Application of biotechnology, remote sensing technology, energy saving technologies and technologies for environmental protection. Building up a strong infrastructural base for production of value added products with special emphasis on food safety and quality matching international standards. Development of Packaging Technologies for individual products, especially cut-fruits & vegetables, so as to increase their shelf life and improve consumer acceptance both in the domestic and international markets. Development of new technologies in Food Processing & Packaging and also to provide for the mechanism to facilitate quick transfer of technologies to field through a net work of R&D Institutions having a Central Institute at the national level with satellite institutions located strategically in various regions to cover up the whole Country and to make available the required testing facilities. This could be done by establishing a new institution or strengthening an existing one. Development of area-specific Agro Food Parks dedicated to processing of the predominant produce of the area e.g., apple in J&K, pineapple in North East, Lichi in Bihar, Mango in Maharashtra and Andhra Pradesh etc. etc. Development of Anchor Industrial Centre and/or linkage with Anchor Industrial Units having network of small processing units. Development of Agro-industrial multi-products units capable of processing a cluster of trans-seasonal produces. Backward Linkage The Policy will promote: Establishment of a sustained and lasting linkage between the farmers and the processors based on mutual trust, understanding and benefits by utilizing the existing infrastructure of cooperative, village panchayats and such other institutions. Mechanism to reduce the gap between the farm gate price of agro-produce and the final price paid by the consumer. Development of Futures Market in the best interest of both the farmers and the processors ensuring a minimum price stability to the farmer and a sustained supply of raw material to the processor. Setting up of an Equalization Fund to ensure sustained supply of raw material at a particular price level and at the same time to plough back the savings occurring in the eventuality of lower price to make the Fund self-regenerative. Forward Linkage The policy will promote: Establishment of a strong linkage between the processor and the market to effect cost economies by elimination of avoidable intermediaries. Establishment of marketing network with an apex body to ensure proper marketing of processed products. Development of marketing capabilities both with regard to infrastructure and quality in order to promote competitive capabilities to face not only the WTO challenge but to undertake exports in a big way. Given the trends in the Indian food and beverage sector including key industry consideration, it

is imperative for the Indian industry to leverage the emerging opportunities at once. These could be: Exploitation of the huge untapped potential in processed foods. Opportunities presented by contract farming, captive supplies of raw materials, disintermediation and direct access to farmers, availability of new and improved seeds and farm technology. Value addition to unprocessed categories of food such as dairy, fruits and vegetable, staples and edible oils. Exploitation of increasing health and safety awareness of the Indian consumer - this would pave the way for value added products on a health platform. Investment in supply chain in order to improve costs, tighten supplies and minimize wastage. Investment in better packaging and cold chain infrastructure will aid the processed food and beverage sector as these would aid in processing of fruits and vegetables. Exploration of appropriate regional branding strategies in order to appeal to the deep rooted traditions, values and customs of the consumer Taking advantage of the inherent ethnic tastes and food habits of the Indian consumer -this provides the local food players a distinct advantage over foreign entrants into the sector and poses an entry barrier for the latter Exploitation of the increasing consumerism fuelled by new job opportunities, larger disposable incomes and the emerging boom in modern retail trade. Opportunities for growth through the inorganic route, both domestically and outbound this would provide access to new product categories, brands, markets and new technologies. The SEZ /AEZ opportunity would also provide players the added incentive to develop greenfield projects within these zones and enjoy additional fiscal benefits The Indian Foods & Beverage industry is poised for a significant leap forward -- these are interesting times and continued success will depend on a proper understanding of the landscape and challenges therein, quickly exploiting emerging opportunities, skillful execution of strategic mergers and acquisitions and effecting a seamless organisation to evolve into truly global players. Thrust Areas The vision 2015 of the Government of India for the food-processing sector aims at:

Enhancing and stabilizing the income level of the farmers Providing choice to consumers in terms of wide variety and taste including traditional ethnic food Providing greater assurance in terms of safety and quality of food to consumers Promoting a dynamic food processing industry Enhancing the competitiveness of food processing industry in both domestic as well as international markets Making the food processing sector attractive for both domestic and foreign investors

Achieving integration of the food processing infrastructure from farm to market Having a transparent and industry friendly regulatory regime Putting in place a transparent system of standards based on science

The following specific targets would be to increase:

The level of processing of perishables from 6% to 20% Value addition from 20% to 35% Share in global food trade from 1.5% to 3%, by the year 2015

An estimated investment of Rs. 100,000 crores is required to achieve the discussed vision, of which Rs.45,000 crores is expected to come from the private sector, Rs. 45,000 crores from Financial Institutions and Rs. 10,000 crore from Government.

What is food processing:Food processing is the set of methods and techniques used to transform raw ingredients into food or to transform food into other forms for consumption by humans or animals either in the home or by the food processing industry. Food processing typically takes clean, harvested crops or butchered animal products and uses these to produce attractive, marketableand often long shelf-life food products. Similar processes are used to produce animal feed.

History:Food processing dates back to the prehistoric ages when crude processing incorporated slaughtering, fermenting, sun drying, preserving withsalt, and various types of cooking (such as roasting, smoking, steaming, and oven baking). Salt-preservation was especially common for foods that constituted warrior and sailors' diets, until the introduction of canning methods. Evidence for the existence of these methods can be found in the writings of the ancient Greek, Chaldean, Egyptian and Roman civilizations as well as archaeological evidence from Europe, North and South America and Asia. These tried and tested processing techniques remained essentially the same until the advent of the industrial revolution. Examples of ready-meals also exist from preindustrial revolution times such as the Cornish pasty and Haggis. During ancient times and today these are considered processing foods. Food processing has also helped create quick, nutritious meals to give to busy families. Modern food processing technology in the 19th and 20th century was largely developed to serve military needs. In 1809 Nicolas Appert invented a vacuumbottling technique that would supply food for French troops, and this contributed to the development of tinning and then canning by Peter Durand in 1810. Although initially expensive and somewhat hazardous due to the lead used in cans, canned goods would later become a staple around the world.Pasteurization, discovered by Louis Pasteur in 1862, was a significant advance in ensuring the micro-biological safety of food. In the 20th century, World War II, the space race and the rising consumer society in developed countries (including the United States) contributed to the growth of food processing with such advances as spray drying, juice concentrates, freeze drying and the introduction of artificial sweeteners, colouring agents, and preservatives such as sodium benzoate. In the late 20th century products such as dried instant soups, reconstituted fruits and juices, and self cooking meals such as MRE food ration were developed. In western Europe and North America, the second half of the 20th century witnessed a rise in the pursuit of convenience. Food processing companies marketed their products especially towards middle-class working wives and mothers. Frozen foods (often credited to Clarence Birdseye) found their success in sales of juice concentrates and "TV dinners".[1] Processors utilised the perceived value of time to appeal to the postwar population, and this same appeal contributes to the success of convenience foods today.

India is the world's second largest producer of food next to China, and has the potential of being the biggest with the food and agricultural sector. The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food and food processing technologies, skills and equipment, especially in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries, Milk & Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic Beverages & Soft Drinks and Grains are important sub-sectors of the food processing industry. Health food and health food supplements is another rapidly rising segment of this industry which is gaining vast popularity amongst the health conscious.

India is one of the worlds major food producers but accounts for less than 1.5 per cent of international food trade. This indicates vast scope for both investors and exporters. Food exports in 1998 stood at US $5.8 billion whereas the world total was US $438 billion. The Indian food industries sales turnover is Rs 140,000 crore (1 crore = 10 million) annually as at the start of year 2000. The industry has the highest number of plants approved by the US Food and Drug Administration (FDA) outside the USA.

India's food processing sector covers fruit and vegetables; meat and poultry; milk and milk products, alcoholic beverages, fisheries, plantation, grain processing and other consumer product groups like confectionery, chocolates and cocoa products, Soya-based products, mineral water, high protein foods etc. We cover an exhaustive database of an array of suppliers, manufacturers, exporters and importers widely dealing in sectors like the -Food Industry, Dairy processing, Indian beverage industry etc. We also cover sectors like dairy plants, canning, bottling plants, packaging industries, process machinery etc.

The most promising sub-sectors includes -Soft-drink bottling, Confectionery manufacture, Fishing, aquaculture, Grain-milling and grain-based products, Meat and poultry processing, Alcoholic beverages, Milk processing, Tomato paste, Fast-food, Ready-to-eat breakfast cereals, Food additives, flavors etc.

Benefits and drawbacks:Benefits

Benefits of food processing include toxin removal, preservation, easing marketing and distribution tasks, and increasing food consistency. In addition, it increases seasonal availability of many foods, enables transportation of delicate perishable foods across long distances and makes many kinds of foods safe to eat by de-activating spoilage and pathogenic micro-organisms. Modern supermarkets would not exist without modern food processing techniques, long voyages would not be possible and military campaigns would be significantly more difficult and costly to execute. Processed foods are usually less susceptible to early spoilage than fresh foods and are better suited for long distance transportation from the source to theconsumer. When they were first introduced, some processed foods helped to alleviate food shortages and improved the overall nutrition of populations as it made many new foods available to the masses. [2] Processing can also reduce the incidence of food borne disease. Fresh materials, such as fresh produce and raw meats, are more likely to harbour pathogenic micro-organisms (e.g. Salmonella) capable of causing serious illnesses. The extremely varied modern diet is only truly possible on a wide scale because of food processing. Transportation of more exotic foods, as well as the elimination of much hard labour gives the modern eater easy access to a wide variety of food unimaginable to their ancestors.[3] The act of processing can often improve the taste of food significantly. [4] Mass production of food is much cheaper overall than individual production of meals from raw ingredients. Therefore, a large profit potential exists for the manufacturers and suppliers of processed food products. Individuals may see a benefit in convenience, but rarely see any direct financial cost benefit in using processed food as compared to home preparation. Processed food freed people from the large amount of time involved in preparing and cooking "natural" unprocessed foods. [5] The increase in free time allows people much more choice in life style than previously allowed. In many families the adults are working away from home and therefore there is little time for the preparation of food based on fresh ingredients. The food industry offers products that fulfill many different needs: From peeled potatoes that only have to be boiled at home to fully prepared ready meals that can be heated up in the microwave oven within a few minutes. Modern food processing also improves the quality of life for people with allergies, diabetics, and other people who cannot consume some common food elements. Food processing can also add extra nutrients such as vitamins.

Drawbacks
Any processing of food can have slight effects on its nutritional density. Vitamin C, for example, is destroyed by heat and therefore canned fruits have a lower content of vitamin C than fresh ones. The USDA conducted a study in 2004, creating a nutrient retention table for several foods.[6] A cursory glance of the table indicates that, in the majority of foods, processing reduces nutrients by a minimal amount. On average any given nutrient may be reduced by as little as 5%-20%.

Another safety concern in food processing is the use of food additives. The health risks of any additives will vary greatly from person to person, in example sugar as an additive would be detrimental to those with diabetes. In the European Union, only food additives (e.g., sweeteners, preservatives, stabilizers) that have been approved as safe for human consumption by the European Food Safety Authority (EFSA) are allowed, at specified levels, for use in food products. Approved additives receive an E number (E for Europe), which at the same time simplifies communication about food additives in the list of ingredients across the different languages of the EU. Food processing is typically a mechanical process that utilizes large mixing, grinding, chopping and emulsifying equipment in the production process. These processes inherently introduce a number of contaminate risks. As a mixing bowl or grinder is used over time the food contact parts will tend to fail and fracture. This type of failure will introduce in to the product stream small to large metal contaminates. Further processing of these metal fragments will result in downstream equipment failure and the risk of ingestion by the consumer. Food manufactures utilize industrial metal detectors to detect and reject automatically any metal fragment. Large food processors will utilize many metal detectors within the processing stream to both ensure reduced damage to processing machinery as well risk to the consumer. The first industrial level metal detector pioneered by Goring Kerr was introduced back in 1947 for Mars Incorporated.

Opportunities for the Food Processing Industry in India

Narendra Shah, CTARA* & K V Venkatesh, Department of Chemical Engineering In India agricultural and dairy sectors have achieved remarkable successes over the last three and a half decades. Besides being one of the world's largest producers of food-grains, India ranks second in the world in the production of fruits and vegetables, and first in milk productionproviding much needed food security to the nation. The accomplishments of the green and white revolutions have, however, not been matched by concurrent developments in supply chain management, and in new technologies for better processing, preservation, and storage of food. Pockets of shortages and near starvation, substantial wastages due to spoilage, quality deficiencies, and inadequate returns to the farmer are still very much in evidence. Increased urbanization, improved standards of living, and the convenience needs of dual income families point to major market potentialities in the food processing and marketing sectors. This is also evident from the presence of several global foods giants and leading Indian industrial enterprises in the country's food processing sector, such as: Nestle India Ltd, Cadbury's India Ltd, Kelloggs India, Hindustan Lever Ltd, ITC-Agro, Godrej Foods and MTR Foods Ltd Besides, in the current globalized milieu, our surplus food production, as well as the increasing preference for Indian foods (in several regions of the world) need to be leveraged to achieve economic, and strategic objectives through exports. The Food and Agriculture Integrated Development Action (FAIDA) report (1997) prepared by McKinsey has estimated that, driven by changing consumer preferences, the annual consumption of 'value-added' foods alone would grow to Rs.225, 000 crores by 2007larger than the entire manufacturing sector! A more recent report has stated an absolute revenue increase of Rs. 900 billion in food manufacturing between 1993 and 2000. This is in contrast with Rs. 150 billion and Rs. 300 billion in the pharmaceutical and IT industries, respectively. Overall, the value of the Indian food industry has increased from Rs. 3.09 trillion in 1993-94 to Rs. 3.99 trillion in 2000-01. The segments with the largest growth potential have been identified as dairy, wheat, fruits and vegetables, and poultry. This report has also identified some of the major challenges for the emerging food industry in India (see box). Major Challenges for the Indian Food Industry

Consumer education that processed foods can be more nutritious Low price-elasticity for processed food products Need for distribution network and cold chain

Backward-forward integration from farm to consumers Development of marketing channels Development of linkages between industry, government and institutions Taxation in line with other nations Streamlining of food laws

Challenges in Food Processing Unprocessed foods are susceptible to spoilage by biochemical processes, microbial attack and infestation. The right post harvest practices such as good processing techniques, and proper packaging, transportation and storage (of even processed foods) can play a significant role in reducing spoilage and extending shelf life. The challenges in processing lie in retaining the nutritional value, flavour, aroma, and texture of foods, and presenting them in near natural form with added conveniences. However, such qualities cannot be readily quantified and correlated with physico-chemical parameters, sensory evaluations providing the only means of benchmarking. Besides, processed foods need to be offered to the consumer in hygienic and attractive packaging, and at low incremental costs. The challenges for the food preservation, distribution and processing sectors are diverse and demanding, and need to be addressed on several fronts to derive maximum market benefits. Presently, the organizations addressing the educational and R & D requirements are too few, and there is a pressing need for supplementing their efforts. In the emerging scenario, the Food Engineering professional needs to develop sufficient awareness and appreciation of the relevant principles of life sciences, and physical sciences, as well as of a wide variety of other topics including: nutrition, preservation and storage techniques, processing unit operations, bio-processing, waste management, distribution and supply chain management, food laws and regulations and so on. Besides, the professional needs to develop an appreciation of R&D and innovation in critical technology areas such as: newer or novel process development in preservation and storage techniques, rheology, colloids and dispersal systems, packaging-polymers and composites, sensors for detection and process control, bioprocess engineering, and so on. Food Process Engineering Mission Projects at IITB IIT Bombay has developed an appreciation of the challenges, as well as opportunities in this area over the last decade, and has played a leading role in conceptualizing a Technology Development Mission Project (funded by MHRD, Govt. of India) on Food Process Engineering with IIT Kharagpur, IISc, Bangalore, and several industry partners. The projects addressed four major areas described below: Supercritical Fluid Extraction (SCFE) process1 SCFE process can help the Indian industry to compete in a fast growing international market for valueadded natural products. Presently, the high cost of imported SCFE equipment deters economically viable use of SCFE technology. Our objective has been to develop viable, world-class SCFE technology through indigenous design and manufacture of components. The SCFE prototype plant designed and installed at IIT Bombay has state-of-the-art safety and process control features of commercial SCFE plants. It is used for technology demonstration, scale-up studies, test sample (extract) generation, and process optimization. Products extracted using this technology have the advantages of purity, high concentrations and extended shelf life. The process allows flexible operating conditions for multiple product extraction, and simultaneous fractionation of extract. It also eliminates toxic residues due to the use of supercritical CO2 as solvent. The technology has been licensed, and SCFE plants based on this technology have been sold to industries in India and abroad. More details at www.iitbombay.com Controlled Atmosphere (CA) Technology for Long term Storage of food grains 2 CA storage consists of reduction of oxygen by elevating nitrogen and/or carbon dioxide concentrations in storage units, so as to enable preservation of the quality of food products during storage. The technique of chemical fumigation that is widely used for storage, although effective to an extent, is not environment friendly. As an alternative, a Pressure Swing Adsorption N2 generator was designed and established at IIT Bombay. This aids the creation of nitrogen and/or carbon dioxide-rich, and oxygen-depleted atmosphere in a storage unit. Bag-stacked items such as,

cereal grains, seeds and black tea have been successfully stored without any infestation, moisture pickup, and with superior quality maintenance in terms of taste, color, lustre and aroma. The choice of plastic films used as covering material for the stored grains was based on their gas permeability and water vapour transmission rates. The work has culminated in the transfer of the CA technology. More recently another project on black-tea storage has been executed, and the resulting technology transferred after filing an international patent jointly with the industrial partner. Engine exhaust-fired Truck Refrigeration System (TRS) 3 Proper refrigeration is critical to the transport of perishable items. A novel technology developed at IIT Bombay, which utilizes engine exhaust has shown encouraging results with both prototype testing and full demonstration. The engine exhaust-fired TRS can replace the conventional dedicated engine-driven vapour compression truck refrigeration system (DEDVCRS) used for transporting fresh fruits, flowers and vegetables, frozen vegetables, fish, meat and ice cream. The TRS can be slightly modified for use in milk transport trucks. The salient features of the system are: rugged and reliable design due to few moving parts, low life-cycle costs due to lower initial and operating costs, and the use of environment friendly ammonia as refrigerant......more on next page