Food processing is a way or technique that is used to convert raw foods into well-cooked and well preserved eatables for both humans and animals. Food processing uses raw, clean, harvested crops or slaughtered and butchered animals and turns these into food products for daily consumption.  A number of products are nutritious, easy to cook and have a long shelf life. They are packed in an attractive manner and are highly marketable.

Food processing sector is indispensable for the development of the economy. It helps to commercialize farming which gives farmers the opportunity to diversify and increase their income and generates employment. However, a large number of FBOs have small operations and productions and many are in the unorganised sector. The organised sector remains small and includes flour mills, fish processing units, fruit and vegetable processing units, sweetened and aerated water units, milk product units, sugar mills, solvent extract units, rice mills, modernised rice mills. The organized sector consists of only 30 per cent the food processing industry in India and within this sector highest meat and poultry processed foods segment contributes the most. India’s food processing sector is highly fragmented and comprises of fruit and vegetables, spices, meat and poultry, milk and milk products, beer and beverages, fisheries, plantation, grain processing, packaged drinks and consumer products such as confectionery, chocolates and cocoa products, soya-based products, packaged drinking water, high protein foods, snacks, etc.

The Food Processing industry is a sunrise sector and is vital to India’s development, primarily due to the linkages and synergies it promotes between the two pillars of our economy - industry and agriculture. The sector in India includes fruit and vegetables; spices; meat and poultry; milk and milk products, alcoholic beverages, fisheries, grain processing and other consumer product groups such as confectionery, chocolates, cocoa products, soya-based products, mineral water and high-protein foods.

Fruits and Vegetables

India is the world’s 2nd largest producer of fruits and vegetables but only about 10 per cent of the produce is processed. It is expected that the processing in this segment will grow to 25 per cent by 2025. This segment is highly export oriented as the domestic penetration is low presently but is expected to grow. Fruits and vegetables processing is equally divided into organised and non-organised sector where organised sector produces juices and pulps and the unorganised makes pickles and sauces

Milk & Dairy

India is the largest producer of Milk and Milk Products and it also has the maximum number of cows and buffaloes in the world. Unorganised sector controls this segment and only about 15 per cent falls into the organised sector.

Grains and Cereals

India is a self-sufficient country in terms of grain production with rice dominating. Rice, wheat and pulses milling is the most important food processing activity in this segment. The unorganised sector has a firm grip here too and since technological upgrading is lacking there is a lot of wastage.

Consumer Foods

This is the fastest growing segment in India and it is highly organised and consist of

·         Packaged Food (snacks, chips, namkeens and bakery products)

·         Aerated Soft Drinks

·         Packaged Drinking Water

Change in consumer taste and preference

With growing awareness, better health consciousness, need for convenience, and improving lifestyles, and the share of processed food is gradually and steadily increasing on consumer plates across the world. In India, this change is bolstered by rising per capita income, a large young population (60 percent below 35 years of age), deeper retail penetration, and a growing number of nuclear families. India’s demands for processed food is, therefore, expected to increase to about 8.5 percent by the end of 2017.