March 7, 2002

    Union Minister of State for Food Processing Industry, Prof. Chaman Lal Gupta today said that his Government has decided to set up a Group of Ministers (GoM) to propose legislative and other changes for preparing a modern integrated food law and related requirements. Speaking at the Asia Interprise "Food Processing 2002" jointly organised by the PHD Chamber of Commerce and Industry (PHDCCI) along with a number of foreign Chamber of Commerce and Industry here, Prof. Gupta said that the Prime Minister has decided to set up this group. He said that provisions have been made under the budget of 2002-03 for the amendment of Milk and Milk Product Order (MMPO) to remove restrictions on new milk processing capacity besides expansion of Futures and Forward Trading to cover all agricultural commodities.

    The Minister outlined the steps taken by his Government and stated that a National Food Processing Policy, which is under the active consideration of the Government, will create a conducive environment for domestic and foreign investment in the Food Processing Sector. He said that the Government has liberalised this sector by allowing 100 per cent FDI and removing quantitative restrictions on imports on almost all processed food products. He said that the National Food Processing Policy, when in a place, will rationalize tax structure, provide fiscal incentives, harmonise and simplify food laws besides concerted campaign for creating a market for processed foods.

    Prof. Gupta said that 27 Food Parks have already been approved by the Government in various states which will facilitate food processing in one location and make available of common infrastructure such as multi-chamber cold storage, effluent treatment and lab testing facility. Welcoming foreign companies to form joint-venture partners for providing technical and financial assistance, Prof. Gupta said that India offers great opportunities for investment, technology transfer and setting up of manufacturing facilities for exports to other countries. He said that his Government is willing to facilitate investment and introduce State-of-the-Art technology in the Food Processing Industry.

    The President of PHDCCI, Mr. Arun Kapur said that the level of bilateral trade, investment and business ties between India and European Union is low compared to the existing potential. He hoped that a synergy can emerge by enhancing mutual cooperation. He emphasised on the need for enhanced bilateral cooperation between business communities of both India and the European Union.

    The two-day event provides a unique platform for companies operating in the Food Processing Sector for close interaction besides bringing small and medium size companies from both the countries together. India, with its liberalised and open environment has become very attractive for foreign investment which is borne by the fact that in comparison to the insignificant amount of foreign investment in this sector in the pre-economic reforms era (pre-1991), last ten years have seen a total FDI inflow of US $ 40 billion over 50 per cent of which is in the form of FDI. Companies, which are participating in this business meeting, include Food Processing companies from Spain, France and the Netherlands besides a large number of Indian companies.