Article Index

 Code No: TIFAC:V:01:DR(FV) Price: 4000 Category:Fruits & Vegetables


Agro-food processing industries have been chosen as one of the Technology Mission Areas for more reasons than one. The share of the agricultural sector in the Gross Domestic Product (GDP) in ht Indian economy declined from nearly 5 5per cent in 1951/52 to 28 per cent in 1993/94. However, this structural change in output has not been accompanied by corresponding change in the occupational structure of the country’s labour force. Nearly 74 per cent of the country’s population live in rural areas.

A little over 60 per cent of the total labour force is still engaged in the agricultural sector.
The rural economy has so far been unable to absorb the increasing rural labour force in production activities and this has been a big constraint for reducing the incidence of rural poverty.

Agro-food processing industries have the potential to generate directly significant employment in production activities and also indirect employment through its forward and backward linkages.
This employment will be in rural areas where these industries have to be located near the source of raws materials, especially perishable agricultural products.

These industries would help in reducing post-harvest losses and wastes as well as in using byproducts more efficiently.
This can increase farmers’ income by getting them better prices and also consumer welfare by increasing the availability of agricultural consumer goods. The available vast potential in our country could be sufficiently exploited through:

(a) selection of appropriate scale and technology of production;
(b) upgradation of technology of existing units:
(c) establishment of suitable linkages between products and consumers at home and abroad; and
(d) establishment of suitable institutional arrangements.

The term “agro-food processing industries” covers a wide range of activities utilizing farm, animal and forestry based products as raw materials. There are certain traditional agro-based industries such as rice and flourmills, sugar, khandsari and gur manufacture, edible oils and the processing of plantation crops like tea, coffee and cashew nuts.

There are also some relatively modern food processing industries such as dairy products, confectionery, marine products, horticultural and vegetable products as well as meat and poultry products. In addition, there is also a limited extent of processing of agro-wastes and by-products of main agro-based industries.

Due to this wide range of activities, there is a lot of diversity in the nature of problems and issues relating to different agro-food processing industries. It is, therefore, difficult to envisage an overall technology policy framework covering the various agro-food processing industries. This report has chosen to concentrate on a few sectors where in the introduction of modern technologies has the potential of creating a substantial impact on the rural economy and improving the income of the rural population.

Any technology policy relating to agro-food processing activities apply differently in the case of different activities depending on the purpose of processing. Some processing refer to necessary processing that must be done before consumption.
Cereals sector belongs to this category of processing. While such processing is already being inn the country, introduction of modern technology in this sector is considered to be beneficial in two ways.

It would improve the efficiency of processing in terms of higher recovery of desired products. Secondly, it would create a number of potentially useful byproducts, some of which are not being fully utilized at present or not utilized in optimum way for producing higher value added products.

Although most of the technology is readily available in the country, it is not being extensively adopted because economic incentives are often mission, or institutional arrangements for collection, processing and marketing of he byproducts may be lacking.

Since the processing of byproducts in the cereals sector constitutes introduction of new manufacturing activities, or the expansion of existing ones, such activities would generate additional employment.

The next category of food processing concerns processing and packaging in order to provide easy transportability and marketability of some food products. The processing of milk and milk products falls in this category. This would increase the income of farmers, especially small farmers and landless agricultural labourers in the rural areas. It would also promote consumer welfare.

The third category relates to processing activities which would help in extending the storage life of seasonal food products. Fruits and vegetables belong to this category. Processing of fruits and vegetables would help in reducing post-harvest losses and would also provide stable income to the growers by eliminating the seasonal fluctuations in income.

A large amount of food processing activities in our country is still being carried on in the unorganized sector which includes household and non-household establishments.

The organized sector representing factory based production accounts only for a small share in the total volume of production. The organized sector is relatively more modern in technology requiring larger investments as compared to the unorganized sector.

However, processing in the organized sector helps in achieving higher efficiency in the use of raw materials and by products.
Processing in the organized sector generates additional employment in trade and transport activities additional employment in trade and transport activities which may be quite substantial as compared to direct employment created in processing activities.

At the same time, consumer welfare is enhanced by modern processing which ensures better quality and clean packaging in an uncontaminated environment. Export potential also improves.

In order to get a clear understanding of the technology issues in the food processing sector, this report has analyzed the current status and future vision of technology in three important sectors, namely (i) cereals, (ii) milk and milk products; and (iii) fruits and vegetables. A brief summary of this analysis is presented below: