Business Standard: March 14, 2019
New Delhi: Union Food Processing Minister Harsimrat Kaur Badal expects more than $28 billion worth of foreign direct investments (FDI) in the food processing sector in 2019.
The ministry is eyeing the next edition of its flagship investment show World Food India, set to take place in November, 2019, to reach that level.
“At the first edition of World Food India last year, we had investment proposals of more than $14 billion, of which ground has been broken for projects worth $11 billion. So, next year, we are targeting to at least double the figure, as investments,” Badal said.
Of the 11 companies that had signed agreements, eight have started on-ground investments. These are set to open a couple of hundred outlets shortly, Badal said.
“When I took over in 2014, FDI in the sector was $500 million, which we brought up to $905 million till the last financial year,” Badal said.
The greater part of the investment was a $500-million investment by US e-commerce major Amazon in retailing of food products in the country.
At present, 100 per cent FDI in food processing sector is allowed through automatic route. In 2016, the Centre allowed 100 per cent FDI through approval route for retail trading, including through e-commerce, in respect of food products manufactured and produced in India.
“We have increased the number of mega food parks from the two to 22 since 2014. If the earlier two created 5,000 jobs, the number is now close to 300,000,” Badal said.
However, Badal complained that access to credit remains a major problem as banks are unwilling to provide loans to an industry that has remained investment heavy.
Her push for a separate non-banking finance company dedicated to the sector has run into problems with the Prime Minister’s Office, which has questioned the idea. “PMO has said there are already a large number of NBFCs. It wants us to engage with Nabard, despite it being a non-starter earlier as well,” the minister said.
We wanted the NBFC not only for lending purposes, but also for creating an environment where risk assessment, sensitisation would be at play, she said. We had also made it clear that it was going to be run as a proper business that will create the capacity to understand the challenges of funding, Badal added.
Kartarpur corridor talks still on
Badal said the upswing of violence at the international border will not affect talks on the Kartarpur corridor in Punjab. Senior officials from the Ministry of Home and External Affairs will be meeting on Thursday at the Attari-Wagah border to discuss early operationalisation of the Gurudwara as an international religious destination.
“Pakistan has said the entry will be only for Sikhs. But our party’s position has been that entry should not be restricted for anyone since Guru Nanak ji belonged to all of humanity,” Badal said. India has acquired a 50-acre plot to build a state-of-the-art passenger terminal to transport at least 5,000 pilgrims each day from Dera Baba Nanak, Punjab, to Gurudwara Kartarpur Sahib, Pakistan.
Punjab Chief Minister Amarinder Singh has said the current system proposes an extremely limited window of travel and would remain restrictive. While he has demanded “passport and visa free ‘khule darshan’, Badal did not confirm if India would officially demand for it.
“Getting in through visas may be a hassle, but visiting Kartarpur should be as easy as visiting the Golden Temple,” she said.
“The Kartarpur Corridor will be ready before the next Gurpurab (12 November) and I’m proud that for the first time a government in the country has been able to do this. The government had committed to it and will be going forward on it despite current tensions,” Badal said.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.