The Indian food industry is set to grow by $100 billion to $300 billion by 2015, a study said.
"The Indian food industry estimated at $200 billion (Rs 8,80,000 crore) in the year 2006-07 is slated to reach $300 billion (Rs 13,20,000 crore) by 2015 with the share of processed food in value terms increasing from 43 per cent to 50 per cent," a report by FICCI-Technopak said.
Food processing being the major sector in the Indian food industry stands at $85 billion (Rs 3,74,000 crore) and gives direct employment to about two million workers, the report said.
The food processing industry is highly fragmented and dominated by the unorganised sector with 75 per cent units falling under it.
"The increasing contribution of food processing sector would largely come from the organised sector," the report said.
The key growth drivers for the Indian food industry would be higher disposable incomes, shifts in spending orientation, increasing organised food retailing, increasing export opportunities, favourable regulatory environment and Government support and investment inflows amongst others, the report said.
Although the industry is growing at a fast pace, the level of food processing is still lower as compared to other countries, the FICCI-Technopak report said.
"The major challenges faced by the sector are low level of research and development, industry academia gap, skill and technology gaps and meeting global quality standards," the report said.
Although the industry was growing at a fast pace, the level of food processing was still lower as compared to other countries, the FICCI-Technopak report said.
"The major challenges faced by the sector are low level of research and development, industry academia gap, skill and technology gaps and meeting global quality standards," it said.
Lack of forward and backward linkages in the food value chain, inadequate agricultural and processing infrastructure and inefficient marketing system are adversely affecting the sector, the report said.
It recommended collaborative efforts by both the government and industry to create and upgrade existing agricultural infrastructure, while developing greater linkages to national and international markets.
"Policy level efforts should be initiated by the Government in consultation with farmer groups and the industry to minimise the prevailing gaps amongst various stakeholders," the report said.
There was an urgent need to create and augment strong production infrastructure, processing infrastructure, distribution and market infrastructure, along with emphasis on augmenting support infrastructure at the same time.
"The increased investment needs to be sought from the private sector for infrastructure development," the report said.
The amendment of the APMC Act should be implemented in the original spirit to reduce the malfunctioning of the Indian marketing system, the report said.
Efficient price discovery mechanism should be evolved to safeguard the interest of different stakeholders for agriculture produce, the FICCI report said.
"Systematic approach should be made to brand Indian fresh and processed food products in the international market," it said, adding the Government should make sincere efforts to help Indian players meet global quality standards.