FDI Lecture


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Dr. R. T. Patil Ex-Director CIPHET, Ex-Group Director (MBA) TIT & Chairman, Benevole Welfare Society for Post Harvet Technology, Bhopal Foreign Direct Investment (FDI) in Food Processing Sector

Production & Post Harvest Scenario:

Production & Post Harvest Scenario Agriculture contributes about 15% of GDP, employs 52 % workforce and sustains approx over 60 % of the population India is the world’s second largest producer of food next to China and has the potential of becoming the biggest in the World. Spending on food accounting for nearly 21% of India’s GDP and Indian domestic food market is expected to grow by nearly 40%. Overall processing level in India has only recently reached 10% and f ood losses range from 6 - 18 % Exports of processed foods in world trade has remained at around 2 percent Food processing creates 1.8 jobs directly and 6.4 indirectly for every US$ 25000 investment

Price Difference :

Price Difference Tomato-Rs. 5/kg Tomato ketchup-Rs 50-80/kg Fruit- Rs. 15-20/kg Fruits Bar-Rs. 200/kg Fruit Juice- Rs. 35/litre Coriander -Rs. 80/kg Coriander Powder-Rs. 200/kg Turmeric-Rs.65/kg Turmeric Powder –Rs. 200/kg Chili- Rs. 200/kg Chili Powder-Rs. 300/kg Black pepper-Rs. 100/kg Pepper Powder- Rs.300/kg Vegetables-Rs.3-5/kg Minimal Processed/Ready to Cook Rs. 25-30/kg

Agro Entrepreneurship :

Agro Entrepreneurship

Agro Entrepreneurship :

Agro Entrepreneurship


The Indian food processing industry accounts for 32% of the country’s total food market. Estimated to be worth USD 121 billion, it is one of the largest industries in India, and is ranked fifth in terms of production, consumption and exports. The industry employs 13 million people directly and 35 million people indirectly. It accounts for 14% of manufacturing GDP, nearly 13% of India’s exports and 6% of total industrial investment. Currently growing at more than 11% per annum, it stood around USD 39.03 billion in 2013 and expected to touch USD 64.31 in 2018. Indian agriculture and processed food exports during April May 2014 stood at USD 3813.63 million. The CII has estimated that the food processing sectors has the potential of attracting US$ 33 billion of investment in 10 years and generate employment of 9 million person days.


The Government of India allows 100% FDI under the automatic route in the food processing sector, in agri -products, milk and milk products, and marine and meat products, except in the case of the following: Proposals that require an industrial license and cases where foreign investment exceeds 24% equity in units that manufacture items reserved for small-scale industries. Proposals in which the foreign collaborator has a previous venture or tie-up in India as on January 12, 2005. Policies and Promotions


Units based on agri-products that are 100% export-oriented are allowed to sell up to 50% in the domestic market. There is no import duty on capital goods and raw material for 100% export-oriented units. Earnings from export activities are exempt from corporate tax. Additionally, there is 100% tax exemption for five years, followed by 25% tax exemption for the next five years, for new agro-processing industries. Policies and Promotions


Mega Food Parks: Government of India is actively promoting the concept of mega food parks (MFPs) and is expected to set up 30 such parks across the country to attract FDI. The government has released a total assistance of USD 23 million to implement the Food Parks Scheme. Until now, approved 50 food parks for assistance across the country. The Centre has also planned for a subsidy of USD 22 billion for mega food processing parks. Agri -Export Zones: The government has established 60 fully equipped agri -export zones (AEZs), in addition to food parks, to provide a boost to agricultural and food processing exports . Policies and Promotions


Structural factors: Growing urbanization, an increase in the number of nuclear families, the rising size of the Indian middle class, rising health awareness and evolving consumer preferences due to more exposure to global markets. Evolving tastes: flavoured milk is gaining popularity, consumption of chicken is increasing more rapidly, juices, jams, jellies, purees, soups, powders, dehydrated vegetables, flakes, shreds and ready-to-eat curries. Raw materials: Abundant supply of raw materials for food production, including fruits, vegetables, spices, dairy products and edible oils. The presence of a skilled workforce and low labour costs are also key factors. Food processing equipment: canning, dairy and food processing, specialty processing, packaging, frozen food/refrigeration and thermo-processing. Factors Influencing FDI


Kraft (USA) Mars (USA) Nestle (Switzerland) McCain (Canada) Danone (France) Ferrero (Italy) Del Monte (USA) Kagome (Japan) Kelloggs (USA) Pepsi (USA) Unilever (Anglo Dutch) Perfetti (Italy) Cargill (USA) Coca Cola (USA) Hershey (USA) Foreign Investors

Important Crops & Novel Technologies :

Important Crops & Novel Technologies

Important Food Grains :

Important Food Grains Rice Wheat Pulses Oil Seeds Groundnut Soybean


Soybean as Protein Food Source Why Soybean 40% best quality plant protein 20% excellent quality oil omega-3 Full of phytochemicals and micronutrients to fight life style diseases USFDA health claim food Need Protein 1 g/kg body weight all through life Pulse consumption need to be 75g/day 9 kg/family of 4 Protein deficiency has created health problems in Indian above 40 years Soy Products Soymilk Soy Paneer Full Fat Soy Flour Medium Fat Soy Flour Soy Nuggets Soy fortified bakery products Soy fortified noodles/Pasta and other formed products


Oilseeds- Modernization of Traditional Industry To get chemical free quality oil through mechanical pressing, filtering and physical refining Modernisation and upgradation of existing oil mills The mechanical pressed and physically refined oil is always healthy compared to solvent extracted and chemically refined oil


D ouble C hamber M odern O il E xpeller Provision for cooling the barrel by passing water through water jackets for temperature of the barrel below 70 C Pungent compounds present in the oil are not escaped during expelling. 10 tpd capacity provides 5.8% residual oil in mustard cake in one-go crushing, as compared to 7.5% in conventional expeller Mustard cake is bright green without any discolouration. Durability worm & cage bar assemblies (10 week against 3 weeks conventional expellers) The plant requires less space for installation.


Pulses- Modernization of Dal Milling Industry Hi-tech modern dal mills with assured minimum dal recovery of 73%. Installation of noise dampner, dust arrester and other pollution control devices Using high temp short time heating process and conditioning process to get maximum gota Loosening of husk without excess water or oil addition


Nutri Rice from Brokens


Dal Analogue Based on Soybean Dal analogue is made from edible grade defatted soya flour, whole wheat flour and turmeric powder using extrusion process. Dal analogue has more than 30% protein which is more than 30% increase in protein content compared to dals The quality of protein is superior due to typical combination of pulses and cereal.   It is a pre‐cooked product it takes less than 10 minutes to cook on open flame compared to more than 25 minutes for other dals.   Perfect vehicle for micronutrients fortification. Protein from soy can certainly help in reducing certain diet related degenerative diseases like heart disease and osteoporosis.  


Agro Processing Centres for Rural Development Rural youths in a team be encouraged to set up agro processing centres to clean, grade, package and process food grains to get the benefit of off season higher prices. Similarly a village level power plant using biomass briquettes can also be encouraged by a team of rural youth. Mini Dal Mill Mini Rice Mill Mini Biomass Power Plant

Important Horticulture Crops:

Important Horticulture Crops Medicinal Crops Garlic Guava Onion Tomato


Garlic Processing Machines Garlic Flaking Machine Garlic Peeler Garlic Bulb Breaker Capacity-800 kg/h Cost-INR 20000 Capacity-400 kg/h Cost-INR 20,000 Capacity-40-50 kg/h Cost-INR 75000

Method to Prepare Dried Garlic Slices:

Method to Prepare Dried Garlic Slices The cloves are separated, peeled and sliced across the length. Slices of 3mm thickness are dipped in 0.5% sodium metabisulphite solution for 15 min at ambient temperature and dried to 6% moisture content (db) in a fluidized bed dryer at 60 0 C air temperature. Slices thus obtained should be immediately packed in airtight containers. Plant & machinery : Stainless Steel knives, Fluidised bed dryer, Work tables, Dipping tanks etc., Manpower : 10-15 kg raw garlic / person for 8 h, Investment: 2 lakhs approx., Capacity: 10-15 kg dried garlic slices / day.

Process Technology for Guava Bar:

Process Technology for Guava Bar Guava is perishable in nature and cannot be stored for more than two days during peak season. Guava can be processed into a number of products like fruits bar and beverage Fruits, which are rich in nutrients can be blended to improve its acceptability and flavor Guava bar acceptable even after 6 month of storage Composition: Moisture: 15%, Vitamin C: 120 mg/100g , Acidity: 1.08%, Reducing sugar: 14%, Non-reducing sugar: 46%, Weight of each bar: 5-10 g , KSM: 0.2%

CIPHET Process of Mechanical Dewatering and Drying:

CIPHET Process of Mechanical Dewatering and Drying Process-The onions were washed, peeled and mechanically dewatered prior to drying with centrifugal juicer. Partial mechanical dewatering resulted in as high as 60.98 % less consumption in energy than conventional method besides getting high value products i.e. onion juice and onion powder. The optimum combinations are 60% dewatering and 60-70  C temperatures. Onion juice was concentrated to 75% solids for increasing its shelf life. Storage studies of onion powder showed that there has been no significant loss in quality even after 2 months storage at room temperature.


Minimal Processing of Vegetables


Crushed Tomato Technology Intermediate processing technology to produce tomato puree in production catchment and its cold storage for further use by Ketchup or Soup or Juice Manufacturers is best option to avoid price crash/distress sale and provide local employment Crushed tomato is an intermediate product developed by ICAR-IIHR where inclusion of seed and skin adds to the consistency and colour of the product and can be used as a substitute to the fresh tomato for various curry preparation

Other Useful Technologies:

Other Useful Technologies

Shrink Packaging of Fruits and Vegetables:

Shrink Packaging of Fruits and Vegetables

Process Technology for Ber Preserves :

Process Technology for Ber Preserves Excellent natural color Very good texture Rich in Vit. C Rich in minerals Least enzymatic browning Can keep well up to 6 months


Minimal Processing of Pomegranate Arils Arils are treated with Chlorinated water for 5 minutes (Sodium hypochloride 100 ppm) + Antioxidant for 30 seconds (5% W/v Citric acid or Ascorbic Acid) and packed in 25 μ Semi permeable film and store at 5 ± 1ºC Maintains quality, colour and shelf life up to 16 days with good physical and microbiological conditions.


Modern Jaggery Manufacture This liquid jaggery and jaggery cubes are getting very popular and fetch very high price and such plants at panchayat level can be very successful


Food Quality and Safety Mandatory employment of a food professional in food business with >50 lakh turn over per year

Selected Successful Examples:

Selected Successful Examples

Soybean Milk and Tofu:

Soybean Milk and Tofu Sh B S Garcha Dist. Sangrur Punjab. Established: 2000 Products: Soymilk, Tofu, Whey beverage, Soy namkeen etc. Monthly Income: >Rs50,000 Employment generated: 10 Capital Investment: 3-4 lakhs Sales outlets stalls in University and colleges

Soybean Products:

Soybean Products Sh J S Sandha, Jalandhar Punjab Established: 2008 Products: flavored soya milk, curd, lassi, namkeen and soya roasted nuts Created Small Scale Franchisees Technical guidance and support by CIPHET


Dried Green Chilli, Ginger and Garlic Powder Sh Saket Ranjan M/s Skysnacks, Punea, Bihar Trained by CIPHET Products: Green chilli powder, Ginger Powder, Garlic Powder, Sattu and Pappad etc. Employment: >10 mostly ladies


Chowdhary Made Agriculture Profitable with Value Addition in Rajasthan Kailash Chaudhary, Age 60 years Products: Aamla juice, amla powder, aloe vera juice, candies, squashes, pickles, sweets Exports to many countries Employment: Direct 30;Indirect 40 Established: 2004 Training and Technologies by CIPHET Turnover: > 1 crore Web: www.ksbiofoods.com


Thank You Email ID- ramabhau@gmail.com Mobile. No. 08964030701 Phone No. 07554007489

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