industry-Food-processing-iastoppers
Editorial Simplified

India shifts attention to Ease of Food Business [Editorial Simplified]

The measures reflect the intent to develop a business-friendly environment for food processing, develop a robust infrastructure framework, and promote foreign investments and collaborations in the Indian food processing and related sectors.
By IASToppers' Editorial Board
November 03, 2017

Contents

  • Introduction
  • India’s performance in Ease of Doing Business Index
  • What factors are responsible for improvement?
  • Reforms towards Ease of Doing Business in India
  • Food processing sector in India
  • Food processing sector: Steps taken by the government
  • FSSI initiatives
  • Future aspects
  • Conclusion

India shifts attention to Ease of Food Business [Editorial Simplified]

For IASToppers’ Editorial Simplified Archive, click here

GS (M) Paper-3: “Food processing and related industries in India- scope and significance, location, upstream and downstream requirements, supply chain management.”
GS (M) Paper-3: “Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.”
GS (M) Paper-2: “Important aspects of governance, transparency and accountability”

 

Introduction:

  • With a view to further ease of doing business in the country India has taken many progressive measures and introduced bold reforms.
  • Such reforms have been duly recognised by the World Bank in its Ease of Doing Business report, 2018.

India’s performance in Ease of Doing Business Index:

Ease-of-Doing-Business-Info-ias

  • In 2018 report, India has jumped over 30 ranks to attain 100th spot from 130th position in 2017 Ease of Doing Business Index.
  • Its score also increased from 56.05 in 2017 to 60.76 in Doing Business 2018.
  • India ranked 103rd in Resolving Insolvency indicator, 119th in Paying Taxes, 29th in Getting Credit, 164th in Enforcing Contracts, 4th in Protecting Minority Investors and 181st in Construction Permits.
  • India is only country in South Asia and BRICS economies to feature among most improved economies of the DB Report this year.

2doing-Business-Report,-2018-iastoppers

  • In South Asia region, India was top improver, but was ranked below Bhutan (75).
  • Nepal, Sri Lanka, Maldives, Pakistan, Bangladesh and Afghanistan were ranked below India.
  • India figures among top 10 countries Brunei Darussalam, Thailand, Malawi, Kosovo, Uzbekistan, Zambia, Nigeria, Djibouti and El Salvador that have marked an improvement this year.

What factors are responsible for improvement?

  • Historic jump in ‘Ease of Doing Business’ rankings is the outcome of the all-round & multi-sectoral reform push of Team India
  • This significant improvement is credited to the mantra of “Reform, Perform, Transform”
  • A strong leadership has provided the political will to carry out comprehensive and complex reforms, supported by a bureaucracy committed to perform.
  • An extensive exercise is also undertaken to increase awareness among users about reforms to ensure extensive use of newly created systems.

Reforms towards Ease of Doing Business in India:

  • Introduction of the goods and services tax (GST),
  • The replacement of the Foreign Investment Promotion Board (FIPB) with the online Foreign Investment Facilitation Portal (FIFP), and
  • Online filings and payment of taxes from a corporate law and tax compliance perspective.
  • It has been focusing on the development of world-class infrastructure too to accelerate growth in manufacturing, ensure scientifically planned urbanisation, and to further attract foreign investments.
  • India has commenced the development of integrated trade corridors and has launched Bharatmala, to streamline road development projects.

Food processing sector in India:

Ease-of-Doing-Business-Food-processing-sector-in-India-iastoppers

  • Despite India being the largest producer of dairy, and second-largest producer of several fruits and vegetables, and certain forms of meat, the levels of food processing are low today.
  • The sector offers vast growth potential, given India’s population, rising affluence, rapid urbanisation, abundant availability of raw materials and more recently the growth of organised retail.

future-of-Food-processing-sector-in-India-iastoppers

Food processing sector:  Steps taken by the government

Food-Processing-Nov-2015-ias

  • The government has liberalised policies and introduced reforms for promoting investments, developing supply chain infrastructure and improving overall processing levels of food.
  • A landmark amendment was passed in 2016, by which 100% FDI is now permitted for retail trading (including through ecommerce) of food products manufactured and/or processed in the country.
  • The ministry of food processing industries also offers several schemes and incentives for the development of food processing and related infrastructure under Kisan Sampada Yojana, with an aim to benefit 20 lakh farmers and generate 5.3 lakh jobs by 2020.

sampada-SCHEME-ias

  • Such schemes include providing capital grants for the development of mega food parks, cold chain infrastructure, preservation facilities and agro-processing clusters.

Food-Processing-jul2017-ias India shifts attention to Ease of Food Business

FSSI initiatives:

  • The Food Safety and Standards Authority of India (FSSAI) has also been aligning itself with Codex Alimentarius (literally, food code) international food standards to promote fairness and safety when it comes to India’s international food trade.
  • Further, the FSSAI has also been introducing several other initiatives to promote ease of doing business in India, including:
  1. Online applications for registration and licensing of food businesses,
  2. Single-window clearances for imported food products,
  3. Organising training for food safety professionals and
  4. Implementation of IT interfaces to minimise visits of food business operators to FSSAI offices.

Future aspects:

  • These measures reflect the intent to develop a business-friendly environment for food processing, develop a robust infrastructure framework, and promote foreign investments and collaborations in the Indian food processing and related sectors.
  • The Indian food processing, food retail, transport, logistics and related infrastructure sectors to play bigger role in the food processing value chain.
  • With total consumption of the food and beverage segment in India expected to increase from $369 billion to $1.142 trillion by 2025, output of the food processing sector at market prices is expected to increase to $958 trillion for the same period.

Conclusion:

  • India being the largest democracy of the world, has vast market opportunity offered by its economy in most of the sectors.
  • It is a very clear signal from India to the rest of the world that not only has the country been ready and open for business, as it has been for many decades, it is now competing as the preferred place to do business globally.
[Ref: Economic Times]

 

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