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Indian government May Subsidize Mega Food Parks Project
Jun 20, 2007

The Indian government is open to give adequate support needed by the companies to set up a food-processing unit in the country.

India has witnessed revolutions in IT and biotechnology. Now, it's the turn for a revolution in food technology (FT). The govt. is seriously considering Rs. 1,500 crore scheme to subsidize the mega food parks' development throughout the country. According to proposal, the development of these parks would be done in the assistance of a SPV (Special Purpose Vehicle), co-funded by the Central and state governments, and private sector. According to report in The Economic Times, each food-park financed under the scheme will receive Rs 50 crore's subsidy.

Indian agriculture minister Mr. Nath is of the view that the Food parks will give a fillip to the retail sector and in turn play a prominent role in increasing the overall economic activity, in addition to placing greater buying power in the hands of the people and assist in generating more revenue for the government.

Nath said, "Agriculture is the key focus area of the government as 650 million people are dependent on the agricultural sector". Though, "The Government is promoting food parks but wouldn't get directly involved in running them and would do only the initial handholding", added the Minister. "Today agriculture has to transform from subsistence to commerce. India must become an important Agricultural exporter", in news, published on Confederation of Indian Industry.

Indian processed food industry has seen tremendous growth and changes over the last few years, driven mainly by changing consumer segments, rapid urbanization, growing population, rising popularity of processed foods. Viewed as the sunrise sector, food-processing market is set for further boom with government's willingness to support it.

As per the
RNCOS report "India Food Processing (2006)" There is no doubt that the organised retail sector has been successful in reaching out to the upper and middle class segments, but reaching out the lower strata of society remains to be the challenge for the Indian retail industry.

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