The Ministry of Food Processing Industries and the National Agricultural Cooperative Marketing Federation of India Limited (NAFED) have recently launched six One District One Product (ODOP) brands under the Pradhan Mantri Formalisation of Micro food processing Enterprises (PMFME) Scheme. The initiative is expected to significantly improve agricultural marketing.
About PMFME Scheme
This scheme, a part of the Atma Nirbhar Abhiyan, aims to enhance the competitiveness of micro-enterprises in the food processing industry’s unorganised segment. By formalising the sector and providing support to Farmer Producer Organisations (FPOs), Self Help Groups (SHGs), and Producers Cooperatives, this scheme will fortify their entire value chain.
One District One Product Approach
The key feature of the PMFME Scheme is the One District One Product (ODOP) approach. It is expected to provide the framework for value chain development and alignment of support infrastructure. States will identify food products for districts, taking into account existing clusters and raw material availability. The selections could range from perishable produce to cereal-based items or food items produced widely in an area.
Capacity Building and Research
Academic and research institutions under MoFPI will be supported along with State Level Technical Institutions to provide training for units, product development, packaging, and machinery provisions for micro-units.
Financial Support
Micro food processing units intending to upgrade their units can avail credit-linked capital subsidy at 35% for eligible project costs with a cap of Rs.10 lakh per unit. Additional funds will also be given for the development of common facilities, like processing centres, labs, warehouses, through FPOs/SHGs/cooperatives or state-owned agencies. Moreover, an initial funding of Rs. 40,000 per Self Help Group (SHG) member will be provided for working capital and procurement of small tools.
Marketing and Branding Support
Under the scheme, groups of FPOs/SHGs/ Cooperatives or an SPV of micro food processing enterprises will receive marketing and branding support. This includes training, establishment of common brand and packaging, quality control measures, and marketing tie-ups with national and regional retail chains.
Funding Structure
PMFME is a centrally sponsored scheme with an outlay of Rs. 10,000 crore. The expenditure under the scheme will be shared between Central and State Governments in varying ratios depending on the regions.
Addressing Challenges in the Unorganised Food Processing Sector
The unorganised food processing sector, which consists of roughly 25 lakh units, suffers from several challenges that impede their growth and performance. These include lack of access to modern technology, equipment, training, institutional credit, basic awareness on quality control, and branding and marketing skills. By supporting and formalising these enterprises, the PMFME scheme aims to alleviate these issues.
About NAFED
NAFED, established on 2nd October 1958, is an apex organisation of marketing cooperatives for agricultural produce in India. With the role of organising, promoting, and developing the marketing, processing, and storage of agricultural, horticultural, and forest produce, it stands as one of India’s largest procurement and marketing agencies for agricultural products.
Other Related Initiatives
Other related initiatives include Pradhan Mantri Kisan Sampada Yojana, Agricultural and Processed Food Products Export Development Authority (APEDA), Minimum Support Prices (MSP), Commission for Agricultural Costs and Prices (CACP), National Skill Development Corporation (NSDC), Codex Alimentarius Commission Draft Food Safety And Standards (Labelling And Display) Regulation, and more. These initiatives further support the development and growth of the agricultural sector.
