Rajeev Chandrasekhar's official website - Member of Parliament



Ministry of Food and Processing Industries  




TO BE ANSWERED ON 27.07.2009 

Food Processing Units In Karnataka.



 Will the Minister of FOOD PROCESSING INDUSTRIES be pleased to state:-

(a)       the number of projects received from Karnataka for setting up food processing units in the State, which are pending for clearance;

(b)       the number, out of them, which are pending for more than three years and those which are pending for less than three years, but more than one year; and

(c)       by when they are likely to be cleared?




(a)  to (c) : Ministry of Food Processing Industries (MFPI) extends financial assistance in the country in the form of grant-in-aid to implementing agencies/entrepreneurs @ 25% of the cost of Plant & machinery and Technical Civil Works subject to a maximum of Rs. 50 lakhs in general areas and 33.33% subject to a maximum of Rs. 75 lakhs in Difficult areas under the Scheme of Setting up/Modernization/Expansion of food processing industries.

Earlier all the applications for such grants were received from all over the country through the State Nodal Agencies in the Ministry. These applications were then Centrally processed and grants disbursed in the Ministry itself. This used to involve avoidable delays. Hence, with a view to enlarge the outreach of this scheme to each nook and corner of the country, accelerate the pace of disposal and to take the Government to door steps of the people, the whole procedure of receipt of application under the Scheme, its appraisal and calculation of grant eligibility as well as disbursement of funds has been completely decentralized from 2007-08. Under this new procedure any entrepreneur /applicant can file application with the neighborhood Bank branch/Financial Institutions (FIs). The Bank/FIs appraise the applications and then calculates the eligible grant amount as per the detailed guidelines given to them by the Ministry in this regard. Banks/FIs appraisal report and recommendation for the grant is transmitted to the Ministry through E-Portal which has been established for this purpose. After the recommendation is received from any Bank/FIs through the E-Portal Ministry sanctions the same and transfers the funds also through the same E-Portal.

Under the decentralized procedure, the applications are received directly by the Banks/FIs, hence the data for receipt of the applications for 2007-08 and 2008-09 is not maintained centrally by the Ministry. However, for the State of Karnataka, during the last three years i.e. 2006-07, 2007-08 and 2008-09, out of 133 applications received under the scheme, 108 applications were approved for which an amount of Rs. 1773.805 lakhs were disbursed. The Ministry release the funds in the shape of grants-in-aid to the agencies/ entrepreneurs depending upon the availability of funds within the budget provision from year to year basis.