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How to Get MoFPI Grants and Capital Subsidies for Your Food Processing Project

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India’s food processing project industry is one of the most rapidly expanding sectors, playing a vital role in the economy while providing great opportunities for employment, trade, and investment. Understanding its value, the Ministry of Food Processing Industries (MoFPI) has created a comprehensive system of funding, infrastructure subsidies, and support grants to invest in different segments of food processing.

In this article, I outline the potential advantages offered by MoFPI, including the grants provided and how to achieve optimal results with them, especially for entrepreneurs or startups wishing to establish a food processing project unit in India.

Table of Contents

Toggle
    • Food Processing Project: A High-Growth Sector in India
      • Related: Launch Your Profitable Food Processing Business
    • What Types of Grants Does MoFPI Offer?
      • Important Grant Schemes
    • MoFPI Grants Allocation – Scheme-Wise Overview (2023–2024)
  • Eligibility Criteria for Receiving Grants from MoFPI
      • Related: How PM Kisan SAMPADA Yojana Is Fueling India’s Agro-Industrial Revolution
    • Step-by-Step Process to Apply for MoFPI Grants
      • 1. Identify the Relevant Scheme
      • 2. Prepare a Detailed Project Report (DPR)
      • 3. Obtain Land and Financial Closure
      • 4. Submit Online Application
      • 5. Evaluation by Project Management Agency (PMA)
      • 6. Approval by Inter-Ministerial Approval Committee (IMAC)
    • Common Projects That Are Eligible for Grants
    • Top States for MoFPI Funded Projects
    • Important Government Schemes for New Companies
    • Questions That Are Frequently Asked
    • NPCS’s Intervention in Your Food Processing Project
      • Check our Food processing videos for more information
    • Conclusion: Get Capital Grants Before 2025 Ends
      • Which business to start? How to choose a business idea?

Food Processing Project: A High-Growth Sector in India

As stated in the MoFPI Annual Report 2023–24, the food processing project sector of India:

  • Contributes 7.66% to manufacturing GVA and 8.45% to agriculture GVA
  • Logged 20.68 lakh workers in registered units and 51.11 lakh in unorganized enterprises
  • Achieved agri-food exports of USD 46.43 billion in 2023–24
  • Keeps growing at 5.63% p.a., which is higher than the agriculture sector’s 4.46%

This progress is supported by government-sponsored initiatives such as PMKSY and PMFME that are centered around capital subsidy funding and grant subsidized aid.

Related: Launch Your Profitable Food Processing Business

What Types of Grants Does MoFPI Offer?

Infrastructure creation, value addition, R&D, and enterprise development are some of the focus areas from which MoFPI grants can be obtained, stemming from structural scheme development.

Important Grant Schemes

Name of the SchemeGoals of Primary ActivitiesMaximum Grant Limit
Mega Food Parks35% of the eligible project cost₹50 crore
Integrated Cold Chain & Value AdditionCold storage, reefer vans, ripening chambers₹10 crores
Agro Processing ClustersAggregation and primary processing infrastructure₹10 crores
Backward & Forward LinkagesConnection with farmers and markets₹5 crores
Food Testing LaboratoriesEnsuring safety and quality of food₹5 crores
R&D ProjectsInnovations in food technology₹2 crores
PMFME SchemeCredit-linked subsidy for micro food units35% of eligible project cost

MoFPI Grants Allocation – Scheme-Wise Overview (2023–2024)

Following the report from MoFPI, the table highlighted below shows grant allocation from major schemes.

SchemeAllocation ₹ Crore
Mega Food Parks1,750
Cold Chain Projects1,850
Agro Processing Clusters960
Backward & Forward Linkages870
Food Testing Labs260
R&D Projects180
Others (Including PMFME, SLTI)630

(Source: MoFPI Annual Report 2023–24)

Eligibility Criteria for Receiving Grants from MoFPI

To receive MoFPI grant support, you must meet the following:

CriteriaRequirement
Legal EntityRegistered company/LLP/co-operative society/trust
Land RequirementOwned or long-term leased land for infrastructure setup
DPR (Detailed Project Report)Must contain technical, financial, and market analysis
Promoter ContributionUsually 25-40% of the total project cost
Bank Term LoanProof of financial closure via a term loan
ComplianceFSSAI, pollution, and building regulations compliance

Related: How PM Kisan SAMPADA Yojana Is Fueling India’s Agro-Industrial Revolution

Step-by-Step Process to Apply for MoFPI Grants

1. Identify the Relevant Scheme

Select a scheme that corresponds with your business model, either a cold storage facility, a processing unit, or a testing laboratory.

2. Prepare a Detailed Project Report (DPR)

A Detailed Project Report should include:

  • Market research along with demand estimates
  • Availability of raw materials
  • Financial forecasts
  • Process flow diagrams and layout designs
  • Assessment of environmental impact

Tip: NPCS prepares certified Market Survey cum Techno-Economic Feasibility Reports containing manufacturing processes, raw material planning, plant layout, and finances. NPCS assists in evaluating the feasibility of food processing projects.

3. Obtain Land and Financial Closure

Secure a lease or purchase agreement for the land, as well as a term loan from the bank. Both the loan and land documents are required to obtain MoFPI grant support.

4. Submit Online Application

You can submit an application using MoFPI’s Scheme Management System. Make sure to have electronic copies of:

  • DPR
  • Term loan letter
  • Land documents
  • Company incorporation certificate

5. Evaluation by Project Management Agency (PMA)

The PMA performs a technical and financial feasibility assessment.

6. Approval by Inter-Ministerial Approval Committee (IMAC)

Upon clearing, the project is approved for grant-in-aid which is usually released in multiple payments as specified.

Common Projects That Are Eligible for Grants

Kind of ProjectFunding Components
Cold Chain UnitsPre-cooling, cold storage, and reefer vans
Processing PlantsMachinery along with civil works and automation
Mega Food ParksCommon infrastructure, research and development laboratories, roads
Agro ClustersSorting, grading, packaging, and storage facilities
Ripening ChambersControlled ethylene gas chambers for ripening
Food Testing LabsChemical and microbiological analysis equipment

Top States for MoFPI Funded Projects

StateFocus AreaReason to Invest
MaharashtraCold chains and fruit processingExcellent connectivity for logistics and exports
Andhra PradeshMarine, mango, and dairy industriesProactive policies along with coastal advantage
PunjabDairy alongside wheat and vegetable clustersRich agricultural base along with infrastructure
Tamil NaduReady-to-eat (RTE) foods, beverages, and bakery goodsSkilled working population and industrial zones
Uttar PradeshMango, dairy, and processed foodsAccess to the northern Indian markets

Important Government Schemes for New Companies

SchemeWhat is Provided
PM Kisan SAMPADA YojanaInfrastructure grants for cold chains, food parks, and clusters
PMFME Scheme35% capital subsidy alongside micro unit capacity building
PLIS for Food ProcessingSales-linked incentives for RTE, marine, dairy products, and millets
ODOP InitiativeBackward linkage grant for funding local produce processing

Questions That Are Frequently Asked

Q1: Is it possible for a startup to apply for MoFPI grants?
As long as the startup is a registered entity and meets other eligibility requirements, they can apply.

Q2: What’s the maximum subsidy I can receive?
A maximum of ₹50 crore for Mega Food Parks and ₹10 crore for Cold Chain or Agro Clusters.

Q3: Am I eligible for assistance with preparing a Detailed Project Report (DPR)?
Yes, NPCS specializes in preparing DPRs along with projected financials and bespoke business plans tailored for grants.

Q4: What is the turnaround time for getting an approval?
Usually 3 to 6 months, but it varies based on the scheme and how complete the documentation is.

NPCS’s Intervention in Your Food Processing Project

At Niir Project Consultancy Services (NPCS), we offer support in areas such as:

  • Conducting Market Surveys and Preparing Techno-Economic Feasibility Reports
  • Analysis of Manufacturing Processes, Raw Materials, Equipment Layout, and Finances
  • Budgetary Assistance with feasibility studies and securing grants, subsidies, and funding

From mango processing units in Andhra Pradesh to spice value-addition plants in Kerala, NPCS is committed to getting your project off the ground.

Check our Food processing videos for more information

Conclusion: Get Capital Grants Before 2025 Ends

The food processing sector is open for business in India and capital subsidy is your launchpad. Now is the time to establish a sustainable, profitable enterprise that pays dividends well into the future.

The initiatives of MoFPI go further than just providing financial assistance; they are aimed at creating and nurturing long-term food value chains which are sustainable and benefit the farmers, the agro-based industry, and the consumers throughout the world.

Take the first step. Invest professionally your efforts. Make aimed submissions.

Which business to start? How to choose a business idea?

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