Vast possibilities exist in agriculture and food processing sector in Madhya Pradesh
To support the ever-increasing population, it is essential to increase the production of crops, boost agricultural activities and food trade in the same proportion. The world population is increasing continuously and it is estimated to reach 10 billion by the year 2050. The global agriculture market has grown from $11 trillion to $12.1 trillion in 2022, which is expected to grow to $16.67 trillion by the year 2026.
Madhya Pradesh, located in the heart of the country, is an agricultural state. Agriculture contributes 47 per cent to its GSDP. That’s why Madhya Pradesh is proudly called “Food Basket of India”. The state has bagged Krishi Karman Award for 7 times. In view of this, there are immense possibilities in agriculture and food processing sector in the state.
Madhya Pradesh is the largest producer of oranges, spices, garlic, ginger, gram and pulses in the country. The area under cultivation of organic products is also significant in the state. It is the second largest producer of soybeans, wheat, maize, citrus fruits, onions and flowers. It is third largest producer of oilseeds, horticulture, chilly, aromatic, medicinal plants and milk. It is the largest producer and exporter of “Sharbati Wheat”. Sharbati wheat flour is considered to be of the highest quality in the country.
The agro-climatic zone of the state is divided into 11 parts. This shows diversity in agricultural produce. The 10 major river basins and inland water bodies spread over 0.3 million hectare in the state, rivers and canals spread over more than 17 thousand kilometers, abundant availability of water from more than 60 thousand hectare small and big ponds further boost agricultural production in the state.
Madhya Pradesh has a lot of opportunities for investment in the agriculture sector, with a special focus on capital investment in the development of quality seeds, fertilisers, fodder production and supply, manufacturing of agricultural machinery and equipment and irrigation projects. Along with this, Artificial Intelligence (AI), blockchain and related digital services are also being promoted in the state to meet the current challenges in agriculture and food processing value chain.
Food Processing
The Madhya Pradesh government has taken initiatives to set up mega food parks, agro-processing clusters, integrated cold chain and value-added infrastructure, enhancing food processing and preservation capabilities. Several measures are also being taken to boost the agriculture, food and dairy processing sectors. Along with the Central Government initiative of PM Formalization of Micro Food Processing, the state government is working for capacity building of state entrepreneurs and providing support to farmer producer organisations, self-help groups and helping unorganised micro food processing enterprises to face the challenges. Producer cooperatives and cooperative societies enable micro enterprises to avail common services along their entire value chain.
The size of the world food processing market in the year 2021 was $5.7 trillion. The sector is expected to grow at a Compounded Annual Growth Rate (CAGR) of 7.60 percent by the year 2030, with Asia Pacific being the leading area in the region. Emerging markets like India, Indonesia, China, Malaysia will drive rapid global growth. Manufacturing and pre-production will rapidly move to these markets to get closer to the growing customer base. India’s food manufacturing industry is worth over US Dollar 400 billion and is expected to grow. It will reach US Dollar 535 billion by the year 2025-26. India has a strong position in food production globally and is ranked as the second largest producer of agricultural and allied sector products after China.
In this scenario, Madhya Pradesh is constantly working to strengthen the food processing industry. Several initiatives have been taken in the state such as setting up of government-funded food parks at 8 locations, 2 private mega food parks and 4 agro-processing clusters approved under APC. The state has increased its storage capacity to about 15 million metric tonnes and has a huge cold-storage handling area with a total area of 3 lakh 54 thousand square meters.
Madhya Pradesh government has collaborated with the World Economic Forum to develop a Food Innovation Hub to nurture talent in the food processing sector. The State already has 5 reputed institutes dedicated to educate the existing work force and add talented skilled force across the value chain for this sector. The Madhya Pradesh government is attracting industries with incentives besides the incentives of the Central government.
Madhya Pradesh has attracted investment in the recent past by providing favourable policy environment at the government level to renowned companies like Cadbury, ITC, Unilever. Madhya Pradesh government has formulated policies that support food processing industry. On the financial front, the incentive given to the food processing sector is one and a half times that of other sectors in the state. The state has increased its exports of agricultural products by an amazing over 18 percent CAGR from 9 thousand 600 metric tonnes worth Rs. 83 crore in the year 2005-06 to about one lakh 43 thousand metric tonnes worth Rs. 1 thousand 300 crore in the year 2021-22.
In the One District-One Product (ODOP) scheme, Madhya Pradesh has identified 24 primary products related to agriculture and horticulture. They include Kodo-Kutki, Bajra, Orange/Citrus, Custard Apple, Mango, Tomato, Guava, Banana, Betel, Potato, Onion, Green Pea, Chilly, Garlic, Ginger, Coriander, Mustard Products, Sugarcane Products, Amla and Turmeric. The production of oranges makes the state ideal for setting up orange processing industries. Several mango based food processing industries are in various stages of establishment in Betul, Katni, Anuppur, Rewa, Singrauli and Raisen districts in the state.
Based on the climate and capabilities of different districts, the state government has encouraged farmers to grow such produce, which can lead to production of processed food products such as juice, jam, squash, syrup, beauty products, perfume, essential oil, pulp, dried mango powder, chutney, mango.
Apart from the food processing sector, dairy activities form an important part of the rural economy of Madhya Pradesh, which are also an important source of employment and income. Most dairy products are sold as milk. Therefore, there is tremendous potential for value addition and overall dairy processing in this sector. Currently, liquid milk accounts for 48 per cent of the state’s total market share. The fastest growing segments include curd, paneer, UHT milk, flavored milk and buttermilk.
Madhya Pradesh is the third largest milk producing state. Milk production is continuously increasing. The contribution of the state in the total milk production of the country is 8.6 percent. Madhya Pradesh Cooperative Dairy Federation- apex body MPCDF- alone has registered an average milk procurement of 9 lakh 13 thousand KGPD. Major companies-enterprises involved in dairy processing include Amul, Sanchi, Anit Industries, Saurabh and Pawanshree Food International. Overall, the state has immense investment opportunities in the entire agriculture, food and dairy processing value chain.
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