In a move which will give a major boost to state's food processing sector, Gujarat government may declare food processing as "seasonal industry".
Industry players are of the view that food processing sector will receive a shot in the arm if it is announced as seasonal industry.
The proposal to consider food processing as the seasonal industry may be announced as part of the new Agri-business Policy-2008, which is likely to be unveiled by the October this year. The draft policy says that the state government proposes to declare food processing as seasonal industry.
"Food processing industry is directly linked with agriculture crops and it should be given the status of seasonal industry," said P. H. Vora, vice president (technical), Oasis Agritech Ltd. If the state government goes ahead with its proposal to declare food processing as seasonal industry, it will help the industry to a large extent. By nature, food processing activity is a seasonal business. However, the players operating in the sector have to face many problems since the industy does not fall in the category of seasonal businesses,” he says.
Sample this: Onion dehydration units function only for six months and remain closed for the remaining period of the year. For not being a seasonal industry, the players or companies have to pay charges such as electricity duties and wages to the employees for the entire year even if the unit is closed after the onion season ends.
Similarly, companies operating in processing of fruits and vegetables too face similar problems. It may be mentioned here that Gujarat is a leading player in dehydrated onions and accounts for 25 per cent of the total dehydrated onion supply in the world.
"The move to declare food processing as seasonal industry will provide a major thrust to the sector," he says. So far, Gujarat government has already declared oil mills, ice factories and sugar businesses as seasonal industries.
Considering the high cost of power required in food and agro processing industry, the government may announce electricity duty reimbursement for additional five years.
The draft policy also proposes power tariff reimbursement at the rate of 25 per cent to green houses, floriculture and tissue culture projects with a ceiling of Rs. 3 lakh.
However, these proposals are subject to change as the final draft of the policy would be announced after due consultation with all the stakeholders of agri and agro sectors, said government officials.
