Prime Minister Formalisation of Micro food processing Enterprises (PM-FME) Scheme

Source: PIB

News: Tribal Cooperative Marketing Federation of India(TRIFED) has signed an MoU with Ministry of Food Processing Industries(MOFPI) For Upliftment of Tribal Lives Through the Implementation of PM-FME Scheme. 

Facts: 

• PM-FME Scheme: It is a centrally sponsored scheme launched by the Ministry of Food Processing Industries(MOFPI). 

What is the aim of PM-FME scheme? 

• To modernize and enhance the competitiveness of the existing individual micro enterprises and ensure their transition to formal sector 
• To provide support to Farmer Producer Organizations, Self Help Groups, and Producers Cooperatives along their entire value chain. 

• Duration: The PM-FME scheme will be implemented over a period of five years from 2020-21 to 2024-25 with an outlay of Rs 10,000 crore.  

• Funding: The expenditure under the PM-FME scheme would be shared in 60:40 ratio between Central and State Governments, in 90:10 ratio with North Eastern and Himalayan States, 60:40 ratio with UTs with legislature and 100% by Centre for other UTs. 
• Coverage: Under the PM-FME scheme, 2,00,000 micro food processing units will be directly assisted with credit linked subsidy. Adequate supportive common infrastructure and institutional architecture will be supported to accelerate growth of the sector. 

What are the Key Features of PM-FME scheme? 

• One District One Product:  

• The PM-FME Scheme adopts One District One Product (ODOP) approach to reap the benefit of scale in terms of procurement of inputs, availing common services and marketing of products. 

• The States would identify food products for a district keeping in view the existing clusters and availability of raw material.  
• The ODOP product could be a perishable produce based product or cereal based products or a food product widely produced in a district and their allied sectors. 

• Other Focus Areas:  

• The PM-FME scheme focuses on Waste to wealth products, minor forest products and Aspirational Districts. 
• The Scheme also places special focus on capacity building and research. NIFTEM and IIFPT, two academic and research institutions under MOFPI along with State Level Technical Institutions selected by the States would be provided support for training of units, product development, appropriate packaging and machinery for micro units. 

• Financial Support: 

• Existing individual micro food processing units desirous of upgrading their units can avail credit-linked capital subsidy at 35% of the eligible project cost with a maximum ceiling of Rs.10 lakh per unit. 
• Support would be provided through credit linked grants at 35% for development of common infrastructure including common processing facility, lab, warehouse through FPOs/SHGs/cooperatives or state owned agencies or private enterprise. 
• A seed capital (initial funding) of Rs. 40,000- per Self Help Group (SHG) member would be provided for working capital and purchase of small tools.