New Delhi: Foreign direct investment (FDI) in India's food processing industry saw a 30% decline in the 2023-24 fiscal year, amounting to ₹5,037.06 crore, according to official data. This is a significant drop from the ₹7,194.13 crore recorded in 2022-23. The information, shared by the Ministry of Food Processing Industries in the Lok Sabha, also revealed that FDI in the sector was ₹5,290.27 crore in 2021-22 and ₹2,934.12 crore in 2020-21.
In previous years, FDI in the food processing sector stood at ₹6,414.67 crore in 2019-20, ₹4,430.44 crore in 2018-19, ₹5,835.62 crore in 2017-18, ₹4,865.85 crore in 2016-17, and ₹3,312 crore in 2015-16. To attract more foreign investment, the government has allowed 100% FDI through the automatic route, with adherence to sector-specific regulations. Additionally, 100% FDI is permitted for trading, including e-commerce, of food products made in India, subject to government approval.
The government has also taken steps to support the sector by excluding all processed food items from licensing requirements under the Industries (Development and Regulation) Act, 1951. Furthermore, both raw and processed food products benefit from a reduced GST rate, with over 71.7% of food items falling under lower tax rates of 0% and 5% across various categories.
However, the export value of processed foods also declined by 17% in 2023-24, dropping to USD 10,881.81 million from USD 13,078.3 million in the previous fiscal year.
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