Scheme for Creation / Expansion of Food Processing / Preservation Capacities

The main objective of the Scheme is creation of processing and preservation capacities and modernization / expansion of existing food processing units with a view to increasing the level of processing, value addition leading to reduction of wastage.

The setting up of new units and modernization / expansion of existing units are covered under the scheme. The processing units undertake a wide range of processing activities depending on the processing sectors which results in value addition and/ or enhancing shelf life of the processed products.

Scheme is implemented through organizations such as Central & State PSUs/ Joint Ventures/ Farmer Producers Organization (FPOs)/ NGOs/ Cooperatives/ SHG’s/ Pvt. Ltd companies/ individuals proprietorship firms engaged in establishment/ up gradation / modernization of food processing units. Proposals under the scheme are invited through Expression of Interest (EOI) and Project Management Agencies (PMA) are engaged by MOFPI to assist in the implementation of the scheme.

Project components

Eligible project components for grant includes the cost of plant & Machinery and Technical civil work. Cost of ‘Utilities’ essential for the plant i.e. Water pipeline, DG set, Boiler, Solid waste treatment plant, ETP etc. are also considered under eligible project cost subject to restriction of above cost being maximum 25% of the total project cost.

Pattern of Assistance

  • 35% of the eligible project cost subject to a maximum of Rs. 5.00 crore in General Areas;

50% of the eligible project cost subject to a maximum of Rs. 5.00 crore in North Eastern States including Sikkim and Difficult areas including Himalayan States (Himachal Pradesh, J&K & Uttarakhand), State Notified ITDP areas and Islands.

Pattern of Release of Grant

Grant is released in two installments each @50% of grant in the following manner:

  • The first installment of grant is released after the firm has utilized 50% of the term loan as well as 50% of promoter’s contribution and on production of the required documents.
  • The second installment is released on the commencement of commercial and submission of documents regarding utilization of 1st instalment of grant and 100% of Term Loan as well as 100% of Promoter’s contribution.
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