The main objective of the Scheme is creation of processing and preservation capacities and modernization/ expansion of existing food processing units with a view to increasing the level of processing, value addition leading to reduction of wastage. The processing activities undertaken by the individual units covers a wide range of post-harvest processes resulting in value addition and/or enhancing shelf life with specialized facilities required for preservation of perishables. While expansion of processing capacity is necessary to increase the level of processing and reduce wastage, the induction of modern technology is intended to make a clear difference in terms of process efficiencies as well as improving the quality of the end product. The setting up of new units and modernization/ expansion of existing units are covered under the scheme.

Scheme is implemented through organizations such as Central & State PSUs/ Joint Ventures/ Farmer Producers Organization (FPOs)/ NGOs/ Cooperatives/ SHG’s/ Pvt. Ltd companies/ individuals proprietorship firms engaged in establishment/ upgradation/ modernization of food processing units.

Eligible Project Components:

The Grant covers the Plant & Machinery Cost and Technical Civil Works. Cost of essential components for the project that is Water Pipeline System, DG Set, Boiler, Solid Waste Treatment Plant, ETP etc. are also considered under eligible project cost subject to restriction of above cost for a maximum 25% of the total project cost.

Pattern of Assistance:

The Scheme provides 35% of eligible project cost in general areas and 50% of eligible project cost in the North East States including Sikkim and difficult areas namely Himalayan States, ITDP areas & Islands subject to maximum of Rs. 5 Crore per Project.

Release of Grant:

The Grant is given in 2 Instalments as given below:

• The 1^st Instalment of grant is released after the entity uses the 50% of Term Loan and as well as 50% of the Promoter’s Contribution and on making of the required documents.
• The 2^nd Instalment of grant is released after commencement of commercial production and submitting the required documents for the utilization of 1^st Instalment of grant and 100% of Term Loan and as well as 100% of the Promoter’s Contribution.