Government issues guidelines for 'Production Linked Incentive Scheme for the Food Processing Industry

The government has issued guidelines for the 'Production Linked Incentive (PLI) Scheme for the Food Processing Industry (PLISFPI). Minister of Food Processing Industry Narendra Singh Tomar also launched an online portal for the PLISFPI.

The Ministry in a statement said, as part of the Prime Minister's announcement of Aatmanirbhar Bharat Abhiyan, the Government has approved a new Central Sector Scheme namely PLISFPI for implementation during 2021-22 to 2026-27 with an outlay of Rs 10,900 crore.

The aim is to support the creation of global food manufacturing champions commensurate with India's natural resource endowment and support Indian brands of food products in the international markets.

The Ministry said, it is inviting applications for availing sales-based incentives and grants for undertaking Branding and Marketing activities abroad under the scheme from three categories of Applicants. The last date for submission of the application is June 17, 2021.

In Category- 1, the applicants are large entities who apply for Incentive based on Sales and Investment Criteria. An applicant under this category could undertake Branding and Marketing activities abroad also and apply for a grant under the scheme with a common application.

In category-2, Small and Medium Enterprises Applicants manufacturing innovative products who are applying for PLI Incentive based on Sales.

In category-3, Applicants who are applying solely for a grant for undertaking Branding and Marketing activities abroad.

The sales-based incentive under the scheme would be paid for six years from 2021-22 to 2026-27 on incremental sales over the base year. The base year for calculation of incremental sales would be 2019-20 for the first four years. For the 5th and 6th years, the base year would be 2021-22 and 2022-23, respectively. Sales should include sales of eligible food products manufactured by the applicants as well as its subsidiaries and contract manufactures.

Applicants will be extended grant @50 per cent of expenditure on branding and marketing abroad subject to a maximum grant of 3 per cent of sales of food products or Rs 50 crore per year, whichever is less. The minimum expenditure for branding abroad shall be Rs 5 crore over five years.

The selection of applicant under Category-I will be based on their sales, exports, committed investment. Four product segments are proposed to be incentivised under the scheme -- ready to cook/ ready to eat (RTC/RTE) including millet-based foods, processed fruits and vegetables, marine products and mozzarella cheese.

Selected applicants must fulfil the minimum required sales growth rate criteria to become eligible for the incentive.

Selection of SME applicants under Category-II and for innovative/ organic products would be based on their proposal, uniqueness of the product and the level of product development etc.

The selection of applicants under category III for branding and marketing abroad would be based on the level of recognition of their brand, strategy and plan for production, sales, exports and branding of products in domestic and export markets.

The Ministry said, details regarding eligibility conditions, minimum investment, selection criteria and scale of incentives care covered in the operational guidelines. The detailed Scheme guidelines are available on Ministry's Website.