Cabinet approves Scheme for Formalization of Micro Food Processing Enterprises

News:Union Cabinet has given its approval to Scheme for Formalization of Micro Food Processing Enterprises for the unorganised sector on all India basis with an outlay of Rs.10,000 crore.

Facts:

Salient features

• Type: Centrally Sponsored Scheme with expenditure to be shared by Government of India and states at 60:40.
• Duration: It will be implemented over a 5 year period from 2020-21 to 2024-25.
• Under the scheme:
  • 2,00,000 micro-enterprises will get credit linked subsidy at 35% of the eligible project cost with ceiling of Rs. 10 lakh.
  • Beneficiary contribution will be minimum 10% and balance from loan. 
  • Seed capital will be given to SHGs (Rs. four lakh per SHG) for loan to members for working capital and small tools.
  • Grant will also be provided to farmer producer organisations (FPO) for backward and forward linkages, common infrastructure, packaging, marketing and branding.
  • Cluster approach will be there with focus on perishables.
• Administration and Implementation mechanisms:
  • The Scheme would be monitored at Centre by an Inter-Ministerial Empowered Committee(IMEC) under the Chairmanship of Minister for Food Processing Industries.
  • State/ UT nodal agency(SNA) would be responsible for the implementation of the scheme.
  • A State Level Committee(SLC) chaired by the Chief Secretary will monitor and sanction proposals for expansion of micro units and setting up of new units by the SHGs/ FPOs/ Cooperatives.
  • A third-party evaluation and mid-term review mechanism would be built in the programme.
  • National level portal would also be set-up wherein the applicants/ individual enterprise could apply to participate in the Scheme. All the scheme activities would be undertaken on the National portal.