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PMKSY aims to construct modern infra from farm gate to retail
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Saturday, 20 June, 2026, 16 : 00 PM [IST]
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A Saranya
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India, a major producer of a variety of crops, is at a pivotal juncture in its agricultural transition, but it still faces challenges like post-harvest losses and volatile prices that affect farmer incomes. The food processing industry plays a major role in increasing value addition and linking farms to markets. This rapidly growing sector is well-positioned for exports to Europe, the Middle East, and Asia and turns produce into goods with added value, like packaged foods and beverages.
The Indian government has promoted investment in food processing through industrial licences, foreign collaborations and export-oriented units since the economic reforms of 1991. This has led to the sector attracting considerable foreign investment. Between April 2000 and December 2024, the food processing industry attracted approximately US$13.01 billion in Foreign Direct Investment (FDI), of which nearly US$7 billion was received during 2014–2024 alone.
The sector accounts for around 32% of India’s total food market and is one of the top industries in terms of production, consumption, exports, employment and growth potential. This is also one of the thrust areas under Make in India initiative.
In 2024–25, India exported processed food products worth US$7.89 billion. Major export items included miscellaneous food preparations, cereal products, processed vegetables, pulses, groundnuts, processed fruits and juices, guar gum, jaggery products, alcoholic beverages, and cocoa products.
The exported processed food products are given in the table as follows:
India's Processed Food Exports (FY 2024–25)
Processed
Food Product
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Export
Value (US$ Million)
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What
It Includes
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Miscellaneous
Food Preparations
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1,476.71
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Packaged
foods, instant mixes, sauces, soups, snacks, and other prepared
food items.
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Cereal
Preparations
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933.78
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Biscuits,
breakfast cereals, pasta, noodles, bakery products, etc.
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Processed
Vegetables
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897.07
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Frozen,
canned, dried, or preserved vegetables.
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Pulses
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854.96
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Processed
lentils, dals, and other pulse products.
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Groundnuts
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794.99
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Peanuts
and peanut-based products.
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Processed
Fruits, Juices & Nuts
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721.86
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Fruit
juices, dried fruits, canned fruits, and processed nuts.
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Guar
Gum
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568.97
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A
thickening agent used in food, pharmaceuticals, and industry.
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Jaggery
& Confectionery
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406.92
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Jaggery,
sweets, candies, and sugar-based products.
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Alcoholic
Beverages
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353.17
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Beer,
wine, spirits, and other alcoholic drinks.
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Processed
Cucumber & Gherkins
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306.72
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Pickled
and preserved cucumbers, often exported to Europe and the USA.
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Cocoa
Products
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295.55
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Chocolate,
cocoa powder, and related products.
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Milled
Products
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192.20
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Flour,
semolina, and other grain-milling products.
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Mango
Pulp
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80.40
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Processed
mango puree used in juices, desserts, and beverages.
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Other
Oil Cakes & Residues
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3.32
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By-products
left after extracting oil from seeds.
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The government started SAMPADA (Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters) in 2017 in order to hasten this change. Later, the programme was renamed Pradhan Mantri Kisan SAMPADA Yojana (PMKSY). The programme aims to construct modern infrastructure from farm gate to retail, with an initial allocation of approximately Rs 6,000 crore and an additional Rs 4,600 crore allowed up till March 2026. Mega Food Parks, cold chain systems, agro-processing clusters, food processing units, backward-forward linkage projects, and Operation Greens efforts were among the 1,608 projects that it had approved as of February 2025. Over Rs 6,198 crore has already been disbursed by these initiatives, demonstrating the government's broad commitment to cutting waste and enhancing supply chain effectiveness. The Production Linked Incentive Scheme for Food Processing Industry (PLISFPI), which was introduced in 2021 with an investment of Rs 10,900 crore, is a significant complementary programme. Large-scale production in industries such as processed fruits and vegetables, ready-to-eat foods, marine goods, mozzarella cheese, and novel or organic foods is encouraged by this programme. Additionally, it encourages the global branding of Indian food items, with a particular emphasis on millet-based goods. As of 2025, 171 businesses had been granted approval under this initiative, bringing in around Rs 8,910 crore in investments and creating over 2.89 lakh jobs, demonstrating its significant influence on employment and industrial growth. Another key pillar is PM Formalisation of Micro Food Processing Enterprises (PMFME) scheme, launched in 2020 with an outlay of Rs 10,000 crore and extended till 2025–26. It targets 2 lakh micro enterprises through credit-linked subsidies and the One District One Product (ODOP) approach. This scheme is particularly important because a large part of India’s food processing sector is still informal. PMFME helps small businesses gain access to institutional credit, better technology, training, and formal markets, thereby improving competitiveness and livelihoods in rural areas. Together, these schemes highlight a strong policy focus on strengthening Micro, Small and Medium Enterprises (MSMEs), which form the backbone of India's food processing sector. MSMEs benefit from financial assistance, technology upgradation, skill development, and market access support under PMKSY, PMFME, and PLISFPI. India's food processing industry has seen recent advancements that point to a significant modernisation drive. To improve food safety and quality, the government intends to fund the construction of 100 new NABL-accredited food testing facilities in 2025–2026. By drawing foreign participants from a variety of industries, including food, machinery, packaging, and logistics, major events like World Food India 2024 have further established India as a global hub. Despite the expansion, problems still exist, such as poor cold storage infrastructure, disjointed supply chains, and adherence to quality standards. However, these problems are gradually being addressed by continued policy backing, growing investments, and technological acceptance. All things considered, the food processing industry is becoming a major growth engine, connecting farmers to international markets and changing agriculture into a value-centric system. In keeping with the 'Make in India' strategy, the industry is expected to be crucial in helping India become a global leader in food processing, with a focus on innovation, sustainability, branding, and exports. One of the key current trends is the shift in consumer demand toward ready-to-eat, packaged, and convenience foods. With a young population and increasing disposable incomes, urban consumers are increasingly opting for processed and branded food products. This has encouraged companies to invest in modern food processing technologies and expand product ranges, including frozen foods, snacks, dairy products, and beverages. Another important trend is the rapid modernisation of supply chains. Companies are increasingly adopting cold storage systems, refrigerated transport, and integrated logistics to reduce post-harvest losses and improve product quality. At the same time, digital technologies such as artificial intelligence, automation, and IoT-based monitoring systems are being introduced in processing units to improve efficiency, safety, and traceability. (The author is assistant professor, Department of Foods and Nutrition (PG), Vellalar College for Women, Tamil Nadu. She can be reached at a.saranya@vcw.ac.in)
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