Production Linked Incentive Scheme for Food Processing Industries

News: The Ministry of Food Processing Industries (MoFPI) has issued detailed operational scheme guidelines and has launched an online portal for‘Production Linked Incentive Scheme for Food Processing Industry’(PLISFPI).

Details:

  • As a part of Prime Minister’s announcement of Aatmanirbhar Bharat Abhiyan, Government of India has approved a new Central Sector Scheme namely ‘Production Linked Incentive Scheme for Food Processing Industry’ for implementation during 2021-22 to 2026-27 with an outlay of Rs. 10,900 croreto support creation of global food manufacturing champions commensurate with India’s natural resource endowment and support Indian brands of food products in the international markets.
  • Ministry of Food Processing Industries is inviting applications for availing sales-based incentives and grants for undertaking Branding & Marketing activities abroad under the scheme from three categories of Applicants:
  1. Category-I: Applicants are large entities who apply for Incentive based on Sales and Investment Criteria. Applicant under this category could undertake Branding & Marketing activities abroad also and apply for grant under the scheme with a common application.
  2. Category-II: SMEs Applicants manufacturing innovative/ organic products who apply for PLI Incentive based on Sales.
  3. Category-III: Applicants applying solely for grant for undertaking Branding & Marketing activities abroad.

Eligibility:

  • Applicant for the Scheme shall be
  • Proprietary Firm or Partnership Firm or Limited Liability Partnership (LLP) or a Company registered in India
  • Co-operatives; and
  • SME and making an application for seeking approval for coverage under the Scheme.
  • Applicant may also include company applying on its own behalf and its subsidiary/ies provided the applicant company holds more than 50% of the stock of its subsidiary/ies and that none of such subsidiary company/ies is included in any other applicant company under the scheme; or Marketing Federation or Apex level co-operatives applying on behalf of Member Unions or Member co-operatives in the case of co-operatives.

Incentives:

  • 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. Base Year for calculation of Incremental sales would be 2019-20 for the first 4 years. For 5th & 6th years, the base year would be 2021-22 & 2022-23 respectively.
  • Sales shall include sales of eligible food products manufactured by the applicants as well its subsidiaries and contract manufacturers.
  • Applicants will be extended grant @ 50% of expenditure on branding & marketing abroad subject to a maximum grant of 3% of Sales of food products or Rs 50 crore per year, whichever is less. The minimum expenditure for branding abroad shall be Rs. 5 crores over a period of five years.

Procedure:

  • Selection of Applicant under Category-I will be based on their sales, exports, committed investment. Four product segments are proposed to be incentivized under the scheme viz. Ready to Cook/ Ready to Eat (RTC/ RTE) including millet-based foods, Processed Fruits & Vegetables, Marine Products and Mozzarella Cheese. Food products included for coverage and those excluded under various segments have been listed in the Guidelines.  Selected applicant must fulfil the minimum required sales growth rate criterion to become eligible for 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.
  • Selection of applicant under category III for Branding & 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.