Start a Food Processing Unit

(176). Start a Food Processing Unit

Invest in Food Processing Sector 
The vision 2015 of the Government of India for the 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.