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This scheme by the Ministry of Food Processing Industries aims to boost food manufacturing, create jobs, and Read More... promote Indian food brands globally by providing financial incentives. Read less

Details

Looking to grow your food processing business or launch new Indian food brands internationally? The government's Production Linked Incentive (PLI) Scheme for the Food Processing Industry could be just what you need. Launched by the Ministry of Food Processing Industries, this scheme is designed to give a significant push to the sector.

What Is This Scheme?

The PLI Scheme for Food Processing Industry offers financial incentives to companies that increase their manufacturing output and sales. It's structured to encourage the growth of Indian food manufacturing giants, promote our brands on the global stage, create more jobs, and ensure farmers get better prices for their produce.

Who Can Benefit From This Scheme?

The scheme is open to various entities involved in food processing. This includes large companies focusing on manufacturing key food products like Ready to Cook/Eat items, processed fruits & vegetables, marine products, and mozzarella cheese. Small and Medium Enterprises (SMEs) can also benefit, especially if they are involved in innovative or organic food products. Additionally, businesses looking to boost their branding and marketing efforts in international markets can receive support.

Why This Scheme Is Important

By incentivizing production and export, the PLI scheme plays a crucial role in making Indian food products more competitive globally. It encourages investment in the sector, leading to technological advancements and improved quality. Ultimately, it aims to create a more robust and self-reliant food processing ecosystem in India, benefiting both businesses and farmers.

Objective

This scheme by the Ministry of Food Processing Industries aims to boost food manufacturing, create jobs, and promote Indian food brands globally by providing financial incentives.

Benefits

Financial Assistance:Financial assistance of up to ₹10,00,00,000/- for a period of 3 years is provided to eligible institutions for establishing and upgrading Centres of Excellence.
Release of Installment-Based Fund:Funds are released in 3 installments of 40%, 40%, and 20% of the total sanctioned amount, ensuring phased and performance-linked financial support.
Performance-Linked Disbursement:The second and third installments are released only after expenditure of at least 75% of the released amount and submission and acceptance of the Utilization Certificate and satisfactory performance report.
Construction Cost Limit:Expenditure on the construction of buildings is capped at 30% of the approved project budget.

Note:Purchase of land /vehicle,except ambulanceand foreign travel, is not allowed from the grant.

Sources and references

Guidelines

Who Can Apply?

To be eligible for this scheme, you must be involved in manufacturing food products in India that fall under the specified target segments. SMEs focusing on innovative or organic food products are also welcome.

Key Requirements:

Sales Performance: Your business must have achieved total sales of food products above a minimum threshold in the base year. This includes any food product sold in consumer packs, even those not specifically listed in the core segments. You can find the detailed sales figures in Appendix A of the official guidelines.
Minimum Investment: You need to commit to making a minimum investment in your manufacturing facilities. The specific amount required is outlined in Appendix A. If there are more applicants than available slots in a segment, companies with higher committed investments (beyond the minimum) will be prioritized.
Product Coverage: The product groups and segments you wish to apply for are detailed in Appendix B. You must clearly specify these in your application. You can also apply for products you intend to manufacture during the project period, provided you inform the Ministry of Food Processing Industries (MOFPI) or the Project Management Agency (PMA) about any new product manufacturing plans after selection.
Manufacturing Location: The entire manufacturing process, including primary processing of the food products, must happen in India. However, this condition doesn't apply to additives, flavours, and edible oils. For food products with annual sales over ₹50 crore, you need to clearly outline the entire manufacturing chain starting from raw materials in your application.
Multiple Segments: You can apply for more than one segment under Category I, but each segment requires a separate application, and you must meet the minimum sales and investment criteria for each.
Financial Standing: Applicants should not have been declared bankrupt, a wilful defaulter, or reported for fraud by any financial institution. Your company's promoters should also not be on the SEBI Debarred List.

Applicant Categories:

Category I: Large companies applying based on sales and investment criteria. They can also apply for branding and marketing incentives abroad.
Category II: SMEs manufacturing innovative or organic products, applying based on sales.
Category III: Applicants seeking incentives solely for branding and marketing activities in international markets.

How To Apply

Applying for the PLI Scheme for Food Processing Industry involves a straightforward online process:

Respond to Expression of Interest (EOI): Keep an eye out for the government's Expression of Interest (EOI) notifications.
Submit Application Online: Applications must be submitted through the official online portal managed by the Project Management Agency (PMA). No offline applications are accepted.
Application Fee: A non-refundable application fee is required. For Category I, it's ₹1,00,000/-. For Category II and Category III (SMEs), it's ₹10,000/-. For Category III (other applicants), it's ₹50,000/-.
PMA Verification: Once submitted, the Project Management Agency (PMA) will review your application within 15 working days.
Rectification: If your application is found incomplete, you will be notified and given 10 working days to submit the missing information. Failure to do so may lead to rejection.
Ministry Approval: Complete applications are then processed for approval by the Ministry of Food Processing Industries.

For detailed application forms and guidelines, please refer to the official documents linked below.

Documents Required for Application

To apply for the PLI Scheme for Food Processing Industry, you will need to prepare and submit several documents:

Completed Application Form (as per Annexure-1 in the Scheme Guidelines)
An Undertaking for Audit of Manufacturing Sites/Offices (as per Annexure-7 in the Scheme Guidelines)
Details of your manufacturing sites, including both owned and contract manufacturing units.
Information on your company's shareholding pattern.
Memorandum and Articles of Association, Partnership Deed, or Registration Certificate.
Annual Financial Statements and Reports for relevant periods.
Sales data for eligible food products for the base year and subsequent years.
Details and proof of your committed investment.
A Chartered Accountant Certificate to verify your sales claims.
A Chartered Engineer Certificate to verify investments, where applicable.
Any other supporting documents as requested in the application form or specified in the Expression of Interest (EOI).

Official Sources

For the most accurate and detailed information, including specific formats for forms and detailed guidelines, please refer to the official scheme documents:

FAQ’s

What is the main goal of this Production Linked Incentive Scheme?

The scheme aims to build strong Indian food companies for the global market, promote our own food brands, create more non-farm jobs, and ensure farmers get fair prices for their produce.

Can a business apply for incentives for more than one type of food product segment?

Yes, you can apply for multiple segments under Category I. However, you'll need to submit a separate application for each segment and meet all the specific sales and investment criteria for every segment you apply for.

What kind of financial benefits does the scheme offer?

The scheme provides financial incentives based on your increased sales of eligible food products. It also offers financial support for promoting Indian food brands and products in international markets.

How is the incentive amount calculated?

The incentive is calculated by multiplying your incremental sales (sales above the base year) by the applicable incentive rate for that specific product segment. These rates can change over the scheme's duration.

How long is this scheme valid?

The scheme is operational from the financial year 2021-22 and will continue until the financial year 2026-27. Any incentives earned in FY 2026-27 will be paid out in FY 2027-28.

What happens if my application is found to be incomplete?

If your application is incomplete, you'll be notified. You'll have 10 working days to submit all the required missing information. If you fail to do so, your application will likely be rejected.

What is the role of the Project Management Agency (PMA)?

The PMA is responsible for managing the application process. They review submitted applications, verify details, and help in disbursing the incentives once applications are approved by the Ministry.

What is the timeframe for getting my application approved?

After the application window closes and assuming all documents are complete, applications are generally expected to be finalized within 90 days.

Is there a fee to apply for this scheme?

Yes, there is a non-refundable application fee. It's ₹1,00,000/- for Category I applicants. For Category II and Category III (SMEs), it's ₹10,000/-. For other applicants under Category III, the fee is ₹50,000/-.

What is required after my application gets approved?

Once approved, you'll receive an approval letter. Within two weeks of receiving this letter, you must submit a performance bank guarantee, which is 3% of your committed investment.

Who is eligible to apply for this scheme?

Businesses that manufacture food products in India are eligible. This includes large entities, Small and Medium Enterprises (SMEs) producing innovative or organic items, and those focusing on export branding and marketing.

What are the main components of this scheme?

The scheme has three main parts: incentivizing manufacturing of key food products (like RTC/RTE, fruits & veggies, marine, cheese), supporting innovative/organic products by SMEs, and providing assistance for branding and marketing Indian products globally.

What kind of documents are typically needed for the application?

You'll need documents like the application form, proof of investment, financial statements, sales data, company registration documents, and certifications from a Chartered Accountant and/or Chartered Engineer.

Does the entire manufacturing process need to be in India?

Generally, yes, the entire chain of manufacturing, including primary processing, must be in India. However, this rule doesn't apply to items like additives, flavours, and edible oils.