Mini Project MBA
Mini Project MBA
Mini Project MBA
On
“FOOD PROCESSING INDUSTRY”
SUBMITTED BY
Akash Sinha
*ID NO-2100823*
AFFILIATED TO
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Student Declaration
I “AKASH DINHA” hereby declares that the work which is being presented in this report
entitled “FOOD PROCESSING INDUSTRY” is an authentic record of my own work
carried out under the supervision of “PROF. NIYATI SHUKLA”.
The matter embodied in this report has not been submited by me for the award of any other
degree/ Diploma/ Certificate.
AKASH SINHA
Name of
Student
Date:
10/01/2022
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Director
Certificate
This is to certify that the work which is being presented in this report entitled “FOOD
PROCESSING INDUSTRY” is an authentic record of the (AKASH SINHA) carried out
under my supervision. The statements made by the candidate are correct to the best of my
knowledge.
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Acknowledgment
Thereafter I would to thank my internal guide PROF. NIYATI SHUKLA for their guidance
and support.
I would also like to thanks all the faculty members, who guided me to complete this project.
Last but not the least, I would also like to thanks those who have contributed their time and
support in preparation of the project.
__________________
AKASH SINHA
SECTION-C
MBA 1 YEAR
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CONTENT
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FOOD PROCESSING INDUSTRY IN INDIA
2021
INTRODUCTION
India is the world‘s second largest producer of food next to China and has the
potential of being the biggest in the World. Food and food products are the biggest
consumption category in India, with spending on food accounting for nearly 21% of
India‘s GDP and with a market size of $181 billion. The Indian domestic food market
is expected to grow by nearly 40% of the current market size to $344 billion by 2025.
India‘s agricultural base is quite strong but wastage is very high and processing of
food products is very low. While processing of food to consumable standards are at
levels of up to 80% in some developed countries, the overall processing level in India
has recently reached 10%.
India has made vast progress overtime in providing food security for its people and
has become largely self-reliant in agriculture. Accordingly, the policy focus has
shifted from attaining self-sufficiency to generating higher and stable income for the
farming population. Food processing industry (FPI) is one area which has the potential
to add value to farm output, create alternate employment opportunities, improve
exports and strengthen the domestic supply chain. India, with about 11.2 % of total
arable land in the world, is ranked first in the production of milk, pulses and jute,
second in fruits and vegetables and third in cereals (Government of India, 2019). It is
also the sixth largest food and grocery market.
The food processing sector comprises of two segments- Primary processed food and
Value-added food. Primary segment comprises of packaged fruit and vegetables, milk,
flour, rice, spices etc and constitutes around 62% in value terms of the processed
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The Indian food processing industry stands at $135 billion and is estimated to grow
with a CAGR of 10 per cent to reach $200 billion by 2015. The food processing
industry contributed 7% to India‘s GDP. The industry employs around 13 million
workers directly and about 35 million indirectly.
The industry is segmented into sectors namely, milk and allied products (dairy), meat
and poultry, seafood, bakery and confectionery, fruit and vegetables, grain, pulses and
oilseeds (staple) products, alcoholic and non-alcoholic products (beverages), and
packaged foods. The classification is not distinct as many processed products overlap
different segments.
India ranks No. 1 in the world in production of Milk (Fresh, whole, buffalo), Pulses,
Ginger, Chick Peas, Bananas Guavas, Papayas and Mangoes. Further, India ranks No.
2 in the world in production of Rice, Wheat, Potatoes, Garlic, Cashew Nuts,
Groundnuts, Dry Onion, Green Peas, Pumpkins, Gourds, and cauliflowers. With
the huge production base India can easily become the leading food supplier to the
world and at the same time serving its vast growing domestic market with over a
billion people.
Investments in the registered food processing units have been growing in the
recent years. In 2007-08 the fixed capital of registered food processing units have
increased by 18.93% over the previous year.
Food processing industry in India is increasingly seen as a potential source for
driving rural economy as it brings synergy between industry and agriculture. A
developed food processing industry is expected to lead increase in farm gate prices
translating into increased rural incomes, reduce wastages, ensure value addition,
promote crop diversification, generate employment opportunities as well as export
earnings. With such a large and diversified production base coupled with low
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manpower cost and modern technology, the Indian food processing sector is poised
for growth, if the advantages are leveraged optimally. The growth is driven by the
fact that the central government has given a priority status to all agro-processing
businesses. Government incentives in the field of mega food parks, cold chain and
exports benefits are also playing an important role in promoting food processing.
The major challenges are investments at different points of the supply and value
chain, proper research, farm and lab connectivity, upgradation of technology,
increase in farm holding, skill and manpower training, backend and front-end
integration and cold chain integration.
The opportunities in the food processing industry are vast. However, there is a need
to improve technology and productivity to be competitive globally. As the economy
grows, the food processing industry will offer bigger opportunities to the new as well
as the existing players.
India has the second largest arable land of 161 million hectares and has the highest
acreage under irrigation. Next to China, India ranks second largest food producer in
the world and has the potential to immerge the biggest with its food and agricultural
sector. India accounts for less than 1.5% of international food trade despite being
one of the world‘s major food producers, which indicates huge potential.
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Production Volume for Major Fruits & Vegetables (in million metric tonnes)
1. Banana 28
2. Mango 19
3. Citrus 11
4. Papaya 5
5. Guava 4
6. Potato 46
7. Tomato 20
8. Onion 18
9. Brinjal 12
10.Cabbage 9
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Fisheries
Frozen & Canned products mainly in fresh form
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Cold Chain and Pack houses- Farm level, logistics, end product storage and
point of retail.
Packaging Technology
Food Testing Labs with latest equipment and technology
Dairy Sector
Advanced technology equipment for increasing milk procurement efficiency,
value addition for dairy products etc.
Innovation in packaging solutions
New product development for cattle feed
New veterinary care technology & cattle diagnostics services
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The major factors that are responsible for the growth of food processing
are:
1. Increased spending on food products:
2. Increase in the number of nuclear families and working women.
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2. Inadequate focus on quality and safety standards: The FSSAI and HACCP
standards are widely accepted by the consumers. It is easy for a factory/ start-up
to acquire these certifications but the follow-up procedures that whether the same
standard protocol is followed or not for processing is still under question. The
consumers have still not forgotten about the Maggi incident, wherein harmful
levels or MSG were found in it and the stand lost in trust amongst the consumers.
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5. Supply chain infrastructural gaps: The six stages through which the inputs are
transformed into end product by undergoing processing activities for final
consumption. Lack of primary processing storage and distribution facilities leads
to additional post-harvest losses of food items.
6. Inadequate and inefficient link between production and processing
Though there are many promising dynamics which support good growth of this
industry, there are still some significant constraints which, if not addressed sooner,
can impede the growth prospects of the Food Processing Industry in India. One of the
biggest constraints is that this industry is capital intensive. It creates a strong entry
barrier and allows limited number of players to enter the market. Players mean
competition which reduces efforts to improve quality standards. Major challenges
faced by the Indian food processing industry include: educating consumers that
processed foods can be more nutritious; dealing with low price elasticity for processed
food products; need for distribution network; development of marketing channels;
streamlining of food laws; improving food quality standards and strengthening food
testing network; strengthening institutional framework to develop manpower for
improving R&D capabilities to address global challenges. These challenges must be
addressed to achieve full potential of the Indian food processing industry.
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STRENGTHS
Round the year availability of raw materials. Social acceptability of agro- processing
as important area and support from the central government. Vast network of
manufacturing facilities all over the country vast domestic market.
WEAKNESSES
High requirement of working capital low availability of new reliable and better
accuracy instruments and equipment’s Inadequate automation w.r.t. information
management. Remuneration less attractive for talent in comparison to
contemporary disciplines. Inadequately developed linkages between R&D labs and
industry. Requirement of investment
Low technological equipment
Inadequate automation with respect to information management Low
salary/wage in comparison to other industry
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OPPORTUNITIES
Large crop and material base in the country due to agro ecological variability offers
vast potential for agro processing activities. Integration of developments in
contemporary technologies such as electronics, material science, computer,
biotechnology etc. offer vast scope for rapid improvement and progress. Opening of
global markets may lead to export of our developed technologies and facilitate
generation of additional income and employment opportunities.
Large population of the country
Increase in level of living of the individuals
Increase in both earning concept among the new generation
Opening of the global market
Development of supportive industries like electronics, computer science etc.
THREATS
Competition from global players Loss of trained manpower to other industries and
other professions due to better working conditions prevailing there may lead to further
shortage of manpower. Rapid developments in contemporary and requirements of the
industry may lead to fast obsolescence.
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Power Rivalry
of (High) (Medium) Products (Low)
Power
of Suppliers (Low)
COMPETITIVE RIVALRY
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SUBSTITUTE PRODUCTS
No close substitutes of products such as milk, fresh fruits and vegetables are
available in the market
• Low switching cost makes consumers switch from one supplier to another
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Joint Ventures
• Many global and Indian companies are getting into joint ventures to make
global products available in India.
• Starbucks and TATA Alliance are one of the largest joint ventures
• Bharti Enterprises and Delmonte Pacific Ltd is the largest fresh baby corn
exporter in India.
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Focus on infrastructure
• The sector has been assigned priority status for bank credit.
• 60 Agri Export Zones (AEZ) have been set up across the country
• According to Vision 2015 formulated by MOFPI, the government plans to
establish 30 mega food parks in public-private partnership mode across the
country; out of these, 10 have already been approved in the first phase
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TECHNOLOGY IMPROVISATION
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Computer vision has long been recognised as a potential technique for the guidance or
control of agricultural and food processes.
Traditionally, quality inspection of agricultural and food
products has been performed by human graders. However, in most cases, these manual
inspections are time‐consuming and labour-intensive, tedious, repetitive and
subjective task. Moreover, the accuracy of the tests cannot be guaranteed. It has been
found by contrast that, the computer vision inspection of food products was more
consistent efficient and cost effective.
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CONCLUSION
The Food Processing Industry sector in India is one of the largest in terms of
production, consumption, export and growth prospects. The government has accorded
it a high priority, with a number of fiscal reliefs and incentives, to encourage
commercialisation and value addition to agricultural produce. This sector is having
ample sector to prosper in future years ahead. These sector could be a good potential
for the Company Secretary professionals who wants to start their own enterprises. in
spite of the problems, agro‐processing technology in India has continued to make
steady progress towards modernisation. For future growth, new initiatives need to be
called for. The main focus should be directed towards minimising pre and post‐harvest
wastage, employment generation and export growth. Furthermore, there is a need in
the growth of accurate, fast methodologies of food processing technologies for the
ever increasing population and the increased expectation of food products of
highquality standards.
It has been noticed in the study that plenty of good research is being
carried out in biotechnological area and IT; however the same is not available at the
point of use. One of the ways to achieve effective information update is through
mobile application. It is recommended that more user-friendly ways to implement
these researches may be explored in future research.
A reinvention of the global food security system is recommended. The research and
development activities should be shared globally in order to avoid drainage of
resources in reinventing the same technology. This paper recommends that
involvement of Public Private Partnership in research, production practices and supply
can provide solutions to the increasing concern on food security globally. New
policies and incentives should be available for investment in this sector.
The important areas identified from the study where technological research needs to
be focused include:
• crop improvement by development of new and better quality of seeds and
agriculture extension facility
• usage of water and fertilisers which are low cost and environment-friendly
• crop protection and effective management to avoid resistance problems by use
of biodegradable ways
• sustainable livestock farming and aquaculture with improved veterinary drugs
usage practices
• Reduction of post- harvest losses at storage and distribution.
• coordinated information sharing among the various stakeholder of the food
chain
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