New Delhi, April 7 The government is evaluating whether to extend a production-linked incentive scheme for the food processing sector after the program attracted investments of Rs 9,207 crore across 22 states over six years, a senior official said on Tuesday.
The scheme, launched in 2021-22 with a budgetary outlay of Rs 10,900 crore, is set to conclude this fiscal year. It has added 3.4 million tonnes per annum of processing capacity and created 3,29,000 jobs, the Ministry of Food Processing Industries said.
"Currently, there is nothing on the table. An evaluation is being conducted. There is no proposal, and there is no demand from the industry," Joint Secretary D Praveen told reporters.
Sales of products covered under the PLI scheme grew at a compound annual growth rate (CAGR) of 10.58 per cent against a 2019-20 baseline, while export sales rose at 7.41 per cent CAGR, the ministry official said, describing the figures as resilient given difficult global conditions.
However, the marine segment has weighed on overall numbers. A sharp drop in 2023-24 was attributed to competition from Ecuador and Vietnam, particularly in the United States – India's primary export destination for seafood.
Indian companies have responded by shifting toward higher-value products such as breaded shrimp, with that segment recovering at a CAGR of 11.5 per cent since 2019-20.
Excluding marine products, domestic sales rose at a CAGR of 11.57 per cent and exports at 13.36 per cent.
Processing capacity among scheme participants more than doubled during the program's investment period, climbing from 3.9 million tonnes per annum to 7.3 million metric tonnes.
The capacity in fruits and vegetables, marine products, mozzarella cheese, and ready-to-eat foods has at least doubled. Mozzarella cheese capacity tripled, from 20,000 to 60,000 tonnes per annum.
The ministry said it counts investment and capacity figures only after commercial production has commenced, verified through tax invoicing data.
Gujarat, Maharashtra, Andhra Pradesh, Uttar Pradesh and Bihar were the top five states by both investment attracted and capacity added.
The scheme is the only one among India's 14 production-linked incentive programs to explicitly support small and medium enterprises.
Of 128 approved companies spanning 274 units, 68 applicants are from the MSME sector. Large companies are also permitted to source from MSME contract manufacturers, whose output qualifies for incentives.
Sales of millet-based products by scheme participants rose roughly 20-fold over four years, while millet procurement from farmers increased 15 times.
India's overall processed food exports grew to USD 10.09 billion in 2024-25 from USD 6.2 billion in 2019-20, with the ministry attributing a significant share of the increase to the incentive program.
Total incentives disbursed stand at Rs 2,740 crore for the first three years, with a further Rs 500 crore expected to be released for 2024-25. Payouts for 2025-26 sales are due by December 2027.