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19 Aug 2023

Scheme for Promotion of Bulk Drug

Cabinet in its meeting approved the Central Sector Scheme – “Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)” to support creation of global food manufacturing champions commensurate with India’s natural resource endowment and support Indian brands of food products in the international markets with an outlay of Rs.10900 crore.

 

Background

 

  • The food processing sector in India encompasses manufacturing enterprises in all the segments from micro to large industries.
  • India is having competitive advantage in terms of resource endowment, large domestic market and scope for promoting value added products.
  • Achieving full potential of this sector would require Indian companies to improve their competitive strength vis-à-vis their global counterpart in term of scale of output, productivity, value addition and their linkages with the global value chain.
  • The Production Linked Incentive Scheme for Food Processing Industry has been formulated based on the Production Linked incentive scheme of NITI Aayog under “AatmaNirbhar Bharat Abhiyaan for Enhancing India's Manufacturing Capabilities and Enhancing Exports”

 

Scheme Objectives:

 

  • Support Food manufacturing entities with stipulated minimum Sales and willing to make minimum stipulated investment for expansion of processing capacity and Branding abroad to incentivise emergence of strong Indian brands.:
  • Support creation of global food manufacturing champions;
  • Strengthen select Indian brand of food products for global visibility and wider acceptance in the international markets;
  • Increase employment opportunities of off-farm jobs,
  • Ensuring remunerative prices of farm produce and higher income to farmers.

 

 

Implementation strategy and targets

 

  • The scheme will be rolled out on All India basis.
  • The scheme shall be implemented through a Project Management Agency (PMA).
  • The PMA would, inter-alia, be responsible for appraisal of applications/ proposals, verification of eligibility for support, scrutiny of claims eligible for disbursement of incentive
  • The incentive under the scheme would be paid for six years ending 2026-27. The incentive payable for a particular year will be due for payment in the following year. The duration of the scheme will be six years i.e. 2021-22 to 2026-27.
  • The scheme is "fund-limited", i.e. cost shall be restricted to the approved amount. The maximum incentive payable to each beneficiary shall be fixed in advance at the time of approval of that beneficiary. Regardless of achievement/ performance, this maximum shall not be exceeded.
  • The implementation of the scheme would facilitate expansion of processing capacity to generate processed food output of Rs 33,494 crore and create employment for nearly 2.5 lakh persons by the year 2026-27.

 

Administrative and Implementation Mechanisms

 

  • The Scheme would be monitored at Centre by the Empowered Group of Secretaries chaired by the Cabinet Secretary
  • Inter-Ministerial Approval Committee (IMAC) would approve selection of applicants for coverage under the scheme, sanction and release of funds as incentives.
  • The Ministry will prepare Annual Action Plan covering various activities for implementation of the scheme.
  • A third party evaluation and mid-term review mechanism would be built in the programme.

 

 

Benefits

  • The bulk drug parks to be developed under this scheme will provide common infrastructure facilities at one place, thereby creating a strong ecosystem for bulk drug manufacturing in the country and will also bring down the manufacturing cost significantly.
  • The scheme is expected to gain a foothold in the global market by encouraging domestic manufacturing of bulk drugs and providing easy access to standard testing and infrastructure to reduce import dependence.
  • The scheme will help the industry to meet environmental standards at low cost through innovative methods of common waste management system and to reap the benefits arising out of the optimization of resources and economies of scale.

 

Loan Amount

 

• Proposed Parks – 3. • Grant -3000 crore • Maximum grant-in-aid for one bulk drug park will be limited to Rs 1000 crore per park (Five Years). • Project cost: The cost of establishing CIF in the bulk drug park. • Duration of the Scheme is from FY 2020-202 1 to FY 2024-2025. • The grant-in-aid will be 70% of the project cost of the common infrastructure facilities (CIF). • The Formulation units shall not be permitted in the park.