The Ministry for Food Processing Industr

Q. What is the PM FME Scheme? 

A. PM FME Scheme: 

It aims to provide financial, technical and business support for upgradation of existing micro food processing enterprises It is a centrally sponsored scheme to be implemented over a period of five years from 2020-21 to 2024-25 with an outlay of Rs 10,000 crore.

The expenditure under the scheme would to be shared in 60:40 ratios between Central and State Governments, in 90:10 ratios with NE and the Himalayan States, 60:40 ratio with UTs with the legislature and 100% by Centre for other UTs.

Q. What are various features of this scheme? 

• The Scheme adopts One District One Product (ODODP) approach to reap the benefit of scale in terms of procurement of inputs, availing common services and marketing of products.
• The States would identify food product for a district keeping in view the existing clusters and availability of raw material.
• Credit facility is also provided in this scheme. 
• Existing Individual micro food processing units desirous of upgradation of their unit can avail credit-linked capital subsidy @35% of the eligible project cost with a maximum ceiling of Rs.10 lakh per unit.
• Seed capital @ Rs. 40,000/- per SHG member would be provided for working capital and purchase of small tools.
• FPOs/ SHGs/ producer cooperatives would be provided a credit-linked grant of 35% for capital investment along the value chain.
• Support for marketing & branding would be provided to develop brands for micro-units and groups with 50% grant at State or regional level which could benefit a large number of micro-units in clusters.

Q. Are the Perishables included in this scheme? 

A. The ODOP product could be a perishable produce based product or cereal-based products or a food product widely produced in a district and their allied sectors. An illustrative list of such products includes mango, potato, litchi, tomato, tapioca, kinnu, bhujia, petha, papad, pickle, millet-based products, fisheries, poultry, meat as well as animal feed among others.

The Scheme also place focus on waste to wealth products, minor forest products and Aspirational Districts.

Q. Why need such a scheme?

A. The unorganized food processing sector comprising nearly 25 lakh units contribute to 74% of employment in the food processing sector.

Nearly 66% of these units are located in rural areas and about 80% of them are family-based enterprises supporting livelihood rural household and minimizing their migration to urban areas.

Q. What are various challenges faced in unorganized food processing sector? 

A. The unorganised food processing sector faces a number of challenges which limit their performance and their growth. These challenges include lack of access to modern technology & equipment, training, access institutional credit, lack of basic awareness on quality control of products; and lack of branding & marketing skills etc. Owing to these challenges; the unorganised food processing sector contributes much less in terms of value addition and output despite its huge potential.