At a high-powered panel discussion organised by Network18 and Bandhan Bank titled Sashakt India: Powering the MSME Engine, leading corporate leaders from the food processing industry discussed the sector’s prospects in a post-Covid world.
Speakers at this thought leadership forum included Suresh Narayanan, Chairman and Managing Director, Nestle India and Chairman of CII’s National Committee on Food Processing; Piruz Khambatta, Chairman and Managing Director, Rasna and Piyush Patnaik, Managing Director - Oil Business, Cargill India.
Extraordinary reforms
The industry experts stated that the sector, which had attracted $4.18 billion of FDI from April 2014 to March 2020, had witnessed extraordinary reforms even in the pandemic-hit period.
There was consensus that MSMEs are essential to the food processing sector and that they were in different stages of evolution.
India well placed
According to Narayanan, some of these MSMEs are in food and vegetable processing segments while others are in the area of manufacturing foods and snacks. “I believe that India being on the number two spot as far as fruit and vegetable production is concerned globally and number one on milk, is at a very opportune moment in the post-Covid world, where consumers are seeking good nutrition, reliable brands and safety,” he said.
Khambatta hailed the government for using the Covid period as an opportunity to usher in long-pending reforms like unfettered market access for farmers, who earlier could sell their produce mostly through the Agriculture Produce Marketing Committee (APMC), changes in the Essential Commodity Act, labour reforms in Uttar Pradesh and Rajasthan, and alterations in the revenue law, making it easier to buy land.
MSME funding
On MSME funding, Khambatta said that banks were more than willing to assist viable projects and any project in a mega food park can attract NABARD-backed financing. Banks are also keen to help those in the food processing industry, as it is a priority sector. In addition, there are PE funds, which are focused on mid-level funding for technological products in food processing.
The government has also announced a venture fund for MSMEs, Khambatta observed.
Most vibrant industry
Patnaik said that food processing is the most vibrant industry in India and new trends were visible everywhere. “If 10 years ago someone had told us that every large snack food company in every part of the country would have a private equity investor, no one would have believed it,” he said, adding that there exist real opportunities at the farm level, especially after the modifications to the APMC mechanism, which will act as the trigger for agro-industrial complexes to come up soon.
The session was moderated by CNBC-TV18’s Executive Editor Latha Venkatesh.
This is a partnered post.
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