The Cabinet will soon take up the proposal to allow 100% foreign direct investment (FDI) in food processing sector through government approval route. The Department of Industrial Policy and Promotion (DIPP) has sent the proposal for the consideration of the Cabinet. They want to make the policy simple.
Only food items will be a part of the policy, non-food items cannot come in the garb of food. Besides, the government is also likely to permit business-to- consumer online selling of food products produced and manufactured domestically.
Finance Minister Arun Jaitley in his FY17 budget speech had said that 100% FDI will be allowed through FIPB route in marketing of food products produced and manufactured in India. This will benefit farmers, give impetus to the food processing industry and also create vast employment opportunities.
Food Processing Industry is one of the major employment intensive segments. In 2013, India allowed 51% FDI in multi-brand retailing with 30% domestic sourcing norm. The share of food processing sector in GDP of manufacturing sector was 9.8% in 2012-13. During April-December, FDI into the country grew by 40% to $29.44 billion.