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Food Processing Industry: Challenges and Government Support
July 19, 20266 min read
Introduction
Food processing is a critical sector that bridges agriculture and industry, adding value to raw agricultural produce through preservation, packaging, and transformation. India is the world's 2nd largest producer of food (after China), yet processes less than 10% of its agricultural output (compared to 65-70% in the USA, 60% in China). The food processing industry has huge potential for employment generation, export earnings, and reducing post-harvest losses. The government has designated it as a sunrise sector with focused policy support.
Size and Structure of the Industry
Sector Composition
| Segment | Share | Examples |
|---|---|---|
| Dairy | ~30% | Milk, cheese, yogurt, ice cream (Amul, Mother Dairy) |
| Grain Milling | ~15% | Rice milling, wheat flour, pulses processing |
| Beverages | ~12% | Packaged juices, soft drinks, tea, coffee |
| Edible Oil | ~10% | Refined oils, vanaspati (Adani Wilmar, Cargill) |
| Meat & Poultry | ~8% | Frozen meat, eggs, processed meat |
| Fruits & Vegetables | ~7% | Frozen, canned, dried produce |
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