The government today said India's food processing industry is not just insulated against the current global financial meltdown but is actually growing.
"The sector is not affected in any way by the financial crisis. It is just growing and coming out of a nascent stage. Moreover, it doesn't have much exposure to the world trade now (just 1.5 per cent)," Food Processing Minister Subodh Kant Sahai said at the Economic Editors' Conference here.
Sahai quoted legendary American investor Warren Buffett to hard sell his sector. "I was watching Buffett's interview in a channel where he said India's food processing sector is the safest area to put money into."
He also linked retail activity, which is a medium for creation of demand, with interest of farmers and said: "Any demand creation will be beneficial for farmers. They will be able to reinvest as it will leave more money in their hands."
Outlining his ministry's achievements, Sahai said the sector is expected to grow at 12 per cent in 2008-09 from just 7 per cent in 2002-03. It has also attracted $110 million (about Rs 550 crore) in foreign direct investment in 2006-07 from $43 million in 2003-04.
The ministry's proposal to set up 10 mega food parks this year in 10 states has gained momentum, with three of them — Jharkhand, Punjab and Assam — offering land. Since land is primarily a state subject, "whoever comes with the land, we will take it up with them", he said.
The government is providing up to Rs 50 crore as grant for project expense of a food park, pegging the cost of setting up infrastructure at Rs 100-150 crore, Sahai said.
Investment up to Rs 6,000 crore is expected to be generated for each such park, he added.
The Food Safety and Standards Authority is also meeting in December to finalise fresh norms for the sector, he said.
