Centre stops funds for food processing scheme

Ambika Sharma

Tribune News Service

Solan,May 28

From now, the state government will bear the cost of incentives given under the National Mission on Food Processing Scheme to investors.

Reason: The Central government has stopped funding the scheme from the current fiscal.

At a time when the state government is grappling with fund crunch, an additional burden of Rs 6 crore to Rs 7 crore will have to be borne by it. The scheme, which was introduced in 2012, was supposed to provide funding in the 75:25 ratio from the Central and state governments, respectively.

The state government was provided with Rs 2.69 crore under the scheme initially, which was approved under the 12th Five Year Plan. The investors were supposed to get various incentives from the Centre after setting up their projects.

These incentives included 33 per cent cost of plant and machinery, 50 per cent assistance for setting up integrated cold chain, maximum of Rs 3 lakh for Human Resource Development, up to Rs 4 lakh for promotional activities, up to Rs 2.5 crore for setting up primary processing centres, up to Rs 5 lakh for modernisation of meat shops and financial assistance of as much as 50 lakh for purchase of vehicles for facilitating these activities. A global consultant, Grant Thornton, was also hired to prepare a vision on what activities were supposed to be undertaken in the state and several projects were sanctioned in the last about two years. Industries Minister Mukesh Agnihotri, when quizzed on the future of those who had invested under the scheme, said the state government would carry forward the scheme which was helpful to promote the food processing industry in the state. Director, Industries, Rajinder Singh said a proposal had been sent to the state government to ensure continuance of this scheme by the state government in the future and efforts were also afoot to seek Central funds for the investors. He said a liability of Rs 4 crore was incurred annually through the scheme and about 40 food processing projects had till now been approved.

While no project has been approved after March, the investors desirous of investing under the project, continued to send their proposals to the Industries Department, said sources.

The discontinuation of the scheme was a major blow to the state as several big projects were in the midst of seeking approval and once set up, they would have helped in making available ready market to the horticulture and agrarian produce of the state.