Elaborate the policy taken by the Government of India to meet the challenges of the food processing sector.
Approach · directive: “elaborate”
What it asks · Explain the Government's policy response to the sector's challenges: low processing levels, post-harvest losses, weak cold chains and linkages, small unorganised units, quality standards and credit.
It asks 2 things — answer each
- Identify the challenges facing the food processing sector
- Elaborate the Government's policy response: infrastructure, supply chains, investment and credit, standards, exports, and later steps
Open with · Processed food's share of agri-food exports rose from 13.7% in 2014-15 to 23.4% in 2023-24, yet the NABCONS study (2022) still counts 12.49 million tonnes of cereals and 11.97 million tonnes of vegetables lost after harvest a year.
Cover
- Challenges: low processing of perishables, high post-harvest losses, thin cold chains, fragmented farm linkages, small unorganised units, uneven standards.
- Infrastructure: PM Kisan SAMPADA Yojana (Rs 6,000 crore for 2016-20; Rs 5,520 crore in the 15th FC cycle) for food parks, cold chains and clusters.
- Supply and prices: Operation Greens (2018) for tomato, onion and potato; 100% FDI and a NABARD fund for credit.
- Formalisation and scale: PMFME (2020, Rs 10,000 crore to 2025-26) for micro units; PLISFPI (2021, Rs 10,900 crore to 2026-27) for scale and brands.
- Standards and markets: FSS Act 2006 and FSSAI; Agriculture Export Policy 2018; World Food India.
- Record: sector GVA up from Rs 1.34 lakh crore (2014-15) to Rs 1.92 lakh crore (2022-23); last-mile cold chains, contracts and skills still weak.
Close with · With farmer-processor links, cold chains at the farm gate and skills built together, the sector can cut the losses NABCONS counts and raise processed food's export share well beyond today's 23.4%.
Add value (verified)
- The Ministry's own description of its flagship scheme states the supply-chain aim in one line.Pradhan Mantri Kisan SAMPADA Yojana, Ministry of Food Processing Industries ↗“PM Kisan SAMPADA Yojana is a comprehensive package which will result in creation of modern infrastructure with efficient supply chain management from farm gate to retail outlet.”
- MoFPI year-end review 2024: sector GVA rose from Rs 1.34 lakh crore (2014-15) to Rs 1.92 lakh crore (2022-23); USD 6.793 billion FDI equity inflow April 2014–March 2024; processed food's share of agri-food exports rose from 13.7% (2014-15) to 23.4% (2023-24).PIB, 23 Dec 2024 — Year End Review 2024: Ministry of Food Processing Industries ↗“The Gross Value Added (GVA) in food processing sector has increased from Rs.1.34 lakh crore in 2014-15 to Rs.1.92 lakh crore in 2022-23 (as per 1 st Revised Estimates) The sector has attracted USD 6.793 billion FDI equity inflow during April 2014- March 2024. The share of processed food exports in agri-food exports has increased substantially from 13.7% in 2014-15 to 23.4% in 2023-24.”
- PMKSY: Rs 6,000 crore for 2016-20 (14th FC cycle), continued after restructuring in the 15th FC cycle with Rs 5,520 crore; since January 2024, 143 projects approved and 69 operational with 14.41 lakh MT capacity.PIB, 23 Dec 2024 — Year End Review 2024: Ministry of Food Processing Industries ↗“allocation of Rs. 6,000 crore for the period 2016-20 (extended to 2020-21) for 14th FC cycle and has been approved to be continued after restructuring during 15th FC Cycle with allocation of Rs 5520 Crore. Since Jan 2024, 143 projects have been approved under various component schemes of PMKSY and 69 projects have been operational resulting in processing & preservation capacity of 14.41 Lakh MT.”
- PLISFPI approved by Cabinet on 31 March 2021 with Rs 10,900 crore, implemented over 2021-22 to 2026-27, incentivising four major food product segments.PIB, 23 Dec 2024 — Year End Review 2024: Ministry of Food Processing Industries ↗“Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)” was approved by Union Cabinet on 31.03.2021 with an outlay of ₹10,900 Crore. The Scheme is being implemented over a six-year period from 2021-22 to 2026-27.”
- PMFME launched in June 2020 with Rs 10,000 crore for 2020-25, extended to 2025-26, the first scheme for micro food processing enterprises, under 'Vocal for Local'.PIB, 23 Dec 2024 — Year End Review 2024: Ministry of Food Processing Industries ↗“Pradhan Mantri Formalisation of Micro Food Processing Enterprises Scheme (PMFME) in June, 2020 to encourage ‘Vocal for Local’ in the sector in a total outlay of Rs. 10,000 crore in the period of FY 2020-2025 for this scheme. The scheme has been extended up to FY 2025-26.”
- NABCONS study (2022) on post-harvest losses: 12.49 million MT of cereals, 7.36 million MT of fruits and 11.97 million MT of vegetables lost.PIB, 1 Aug 2025 — NABCONS Study Assesses Post-Harvest Losses Across 54 Crops During 2020–22 (Rajya Sabha reply) ↗“Category wise losses in quantity Category Quantity lost (Million MT) As per NABCONS study (2022) Cereals 12.49 Pulses 1.37 Oil Seeds 2.11 Fruits 7.36 Vegetables 11.97”
Question: UPSC's CS (Main) 2019, GS Paper III — paper ↗. Approach: Minimalist IAS, checked 3 Oct 2026 (how we verify) — UPSC publishes no model answers. ·
Model answer· 370words · Minimalist IAS
Processed food's share of India's agri-food exports rose from 13.7% in 2014-15 to 23.4% in 2023-24, yet the NABCONS study (2022) still counts 12.49 million tonnes of cereals and 11.97 million tonnes of vegetables lost after harvest each year. Policy has to close this gap between potential and waste.
The challenges the sector faces
- Low processing and high losses: perishables rot for want of cold chains and farm-to-factory links; units are small and unorganised; standards uneven; credit and skills scarce.
Government policy to meet the challenges
- Infrastructure: PM Kisan SAMPADA Yojana, Rs 6,000 crore for 2016-20 and Rs 5,520 crore in the 15th Finance Commission cycle, funds mega food parks, cold chains, clusters and testing labs; since January 2024, 143 projects approved and 69 operational.
- Price and supply stability: Operation Greens (2018) for tomato, onion and potato value chains, linking growers to processors and curbing gluts.
- Formalising micro units: PMFME (2020), Rs 10,000 crore over 2020-21 to 2025-26, gives credit-linked support to micro enterprises under 'Vocal for Local'.
- Scale and brands: PLISFPI, approved in March 2021 with Rs 10,900 crore over 2021-22 to 2026-27, rewards output in four product segments and Indian brands abroad.
- Investment and credit: 100% FDI, which drew USD 6.793 billion of equity since April 2014, and a NABARD fund for cheaper credit to food parks.
- Standards and markets: the Food Safety and Standards Act, 2006 with FSSAI licensing and labs; the Agriculture Export Policy, 2018 and World Food India.
| Challenge | Scheme | Design |
|---|---|---|
| Post-harvest loss | PMKSY | Cold chains, food parks, clusters |
| Unorganised micro units | PMFME | Credit-linked subsidy, formalisation |
| Scale and global brands | PLISFPI | Output-linked incentives, 2021-27 |
How far the policy has worked
- Gains: sector GVA rose from Rs 1.34 lakh crore (2014-15) to Rs 1.92 lakh crore (2022-23).
- Gaps: last-mile cold chains, farmer-processor contracts, skills and steady domestic demand remain weak, so assets created do not yet deliver full value.
Way forward
- Link farmers to plants: FPO-based supply contracts and cold storage at the farm gate; food-technology skills in clusters; quality labels that win consumer trust.
With farmer-processor links, cold chains at the farm gate and skills built together, the sector can cut the losses NABCONS counts and push processed food's export share well beyond today's 23.4%.
Prepared by Minimalist IAS to the answer standard of Shivam Singh (mentor, 7 years) · facts checked against official sources (how we verify) · updated 3 Oct 2026. UPSC publishes no model answers: compare your structure and coverage with this, then write your own.
