India is one of the few countries which has a diverse production of food crops and foodstuffs. It cultivates over 315 million tones of cereals, 330 million tones of fruits and vegetables and produces 230 million tones of milk which makes India the highest milk producer in the world.
Along with this, India supports a claims on being and agricultural heavens due to the amount of crops produced yearly. What makes this even more astonishing is that India manages to waste 25% of post harvest stock. Upon reflection, this is a dire situation but to some, it is an opportunity of a lifetime.
India is an agricultural haven and this is best shown in its exports. In the financial year of 2023, India Agri food exports reached 46.43 billion dollars which demonstrates impressive growth.
However, the growth is offset by over 31 billion dollars worth of food products imported which demonstrates a gap. In the case of aspiring entrepreneurs, it clearly represents an opportunity.
The message is simple, the gap represents the opportunity. Packaged and high value agriculture excess products can be value added and this is the proposed strategy of this guide. Let’s delve more into this.
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Why stick to value added agri-exports?
The hypothesis states that value adding raw agri-products will most certainly lead to savings of waste and in addition, benefit the business tremendously. It’s a win win situation.
Exceptional Profit Margins: Treated products, for example: fruit concentrates and oleoresins, are most certainly to be priced at more than 2-3 times of their actual worth, thus leading to more than significant profits.
There also exists an endless supply of raw: Indian food products that can beautifully complement the ever-growing demand for healthy, organic, plant based meals readily available for cooking.
Generate Employment: Food processing businesses have incredible potential for job creation, especially in rural and peri-urban regions.
Reduce Import Dependency: Locally processing oilseeds and cocoa contributes to diminishing India’s import bill.
Hot Startup Ideas in Food Processing & Packaging
To capitalize on surplus produce, here are some successful businesses you can start immediately:
Onion & Vegetable Powders
India often faces surplus onion production, which can go completely to waste. Instead, why not transform it into something valuable.
- Business Model: Install dehydration systems to manufacture powders for onion, garlic, tomatoes, and ginger.
- Target Markets: The Middle East, European Union, and regions in Africa have a strong demand for these ingredients because of their extended shelf life.
- Startup Tip: Look for the subsidized single-unit food parks which are the ready-built infrastructures available for small-scale food processing factories.
Pulse Protein Isolates & Flours
We are the largest pulse producer in the world, but import processed protein and that needs to change.
- Business Model: Build extraction facilities for in demand pea protein and pulse protein bases flours like chickpea and lentil flour.
- Target Markets: North America and the European region, because of the rise in consumption of vegan and plant-based foods.
- Startup Tip: Construct an authentic ‘farm to table’ narrative for export markets by developing strategic partnerships with Farmer Producer Organizations (FPOs) for guaranteed access to high quality pulses.
Fruit Concentrates & Freeze-Dried Products
To counter the 25% of fruits that go to waste, processing fruits offers a solid solution.
- Business Model: Construct individual units for pulping, juicing, and freeze-drying for mango, banana, and pineapple.
- Target Markets: USA and EU for beverages, confectionery, and baby food.
- Startup Tip: The government has initiated the PMKSY scheme which aids in the construction and development of the cold chain systems essential for your line of business.
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Spices & Oleoresins
The leading trader in the spice business around the world is India, with exports valued at $4.7 billion dollars. The more advantageous business, however, is selling the enhanced extracts.
- Business Model: Value-added small-scale units of spice oil extraction can produce oleoresins utilized in the food, pharmaceutical, and cosmetic industries.
- Target Markets: Food, pharmaceutical, and cosmetic industries on a global scale.
- Startup Tip: Utilize the One District One Product ODOP strategy in spice abundant states such as kerala and gujarat.
Ready-to-Eat (RTE) Meals
People from around the globe enjoy Indian cuisine. Let’s facilitate their experience.
- Business Model: Packages of frozen meals and Indian retort-curry pouches, along with other Indian-inspired dishes.
- Target Markets: Strong Indian populations in the USA, Canada, and UK, along with other countries.
- Startup Tip: It’s easier to scale a Ready-to-Eat (RTE) brand with the PLISFPI scheme which provides incentives based on the growth in sales.
Government Assistance: An Alternative Approach
The Indian Government continues to encourage advances in the food processing industry. Do not attempt to achieve these alone; rather, take advantage of the various schemes formulated for this purpose:
Kisan Sampada Yojana (PMKSY): Assists the construction of Mega Food Parks, Cold Chains, and Agro Processing Clusters, ideal for the start-up food processing companies which are in need of and are trying to establish infrastructure.
PMFME (Pradhan Mantri Formalization of Micro Food Processing Enterprises): Assists two lakh micro enterprises, primarily ODOP based, with a subsidy of 35%
Production Linked Incentive Scheme (PLISFPI): Available for micro and small enterprises focusing on ODOP as a model and which allows further scaling prospects as it offers financial support for the sales growth of processed food products.
Nivesh Bandhu Portal: This portal brings together clusters of raw materials, investment, and trade, and is the best starting point for processing and packaging research.
Read More: Food Processing Innovations for a Smarter and Sustainable Future
A Concise Guide For Your Agri-Export Enterprise
Determine Your Crop: Use the portal to Indicate the Nivesh Bandhu with a range of crops on offer in your locality.
Model Selection: From the available alternatives, choose any two from dehydration, freeze-drying, and meal extraction to which you will add retort packaging for the ready-to-eat (RTE) meals.
Foundational Grants & Incentives: Formulate a sound business strategy and seek for assistance under PMKSY, PMFME, PLISFPI respectively.
Improve Your Packaging: Exports and shelf life of the product is directly influenced through good quality packaging such as vacuum packed pouches and retort pouches.
Obtain Certifications: Licenses like, FSSAI, HACCP, and ISO are essential as is the IEC which is your import export code.
Develop Your Brand Story: Create An Indian Origin Brand Story with Global Standards Considerations.
Identify Your Clients: Focus on the Middle East, EU, and the US within the initial phases of the strategy.
Consult with Industry Leaders: Work with firms, such as Niir Project Consultancy Services (NPCS), to obtain a Detailed Project Report (DPR). Now, a DPR is a document, which encompasses project marketing, financial, and technical aspects, to aid in acquiring funds for a project.
By following this strategy, the agricultural surplus of India can be turned to profit as a globally acknowledged brand. It can be done in this period of time, unlike any other in history.
How NPCS Can Help
Launching this business requires significant preparation and planning; as a result, consultancies like NPCS (Niir Project Consultancy Services) can be invaluable.
NPCS works with individuals and companies to provide comprehensive support services from preparing in-depth project reports that describe costs, equipment, space, personnel, and revenue to developing a comprehensive business plan tailored to your budget and market characteristics.
Their scope of consulting is widely applicable to start your business, allowing you to eliminate risk, decrease mistakes, and enter the business more easily and profitably.
Find the Best Idea for Yourself With our Startup Selector Tool
Final Thought: Global Success Achieved From surplus
The surplus of agricultural product that India holds could be the basis for numerous innovative entrepreneurial ideas rather than a problem to overcome.
The support of the government, and the growing demand abroad, makes it easier than ever to send these products abroad. These products could be our onions, our milk, or our spices.
Startups have the opportunity to address the gaps in rural and agro communities leveraging smart innovations in branding, processing and packaging.
They can help reduce post-harvest loss in India, helping reinforce the nation’s agro-economic powerhouse status. There is a harvest ready to be made. You can process, package, and capitalize on the opportunity.
FAQS
What business within food processing will be most profitable in India?
The business which has the most profit is spice oleoresin extraction, even fruit concentrates, and ready-to-eat meals as they hold high global value and profit as well. More, they are low-cost and low raw materials making ready-to-eat meals.
Is capital a large factor in starting a food processing unit?
Not in all cases. Starting small, for example, a dehydrated vegetable unit is a good starting point. With government support under the PMFME scheme, 35% subsidy is provided, supporting low capital investment for starting micro enterprises.
What are the most basic licenses required for food processing export?
On the basic level, you will need FSSAI certification, GST, Import-Export code, along with other basic certifications acquired depending on which country you are processing with, like HACCP and ISO.
Which are the top target markets for Indian food processing?
The Indian food processing markets include USA, UK, Saudi Arabia, UAE, and others which are part of the European Union. These markets significantly need Indian dishes, spices, and vegetarian food.
How can I find reliable buyers for my export products?
You can find buyers through Export Promotion Councils like APEDA, through participation to international food trade fairs like Gulfood or SIAL, or through B2B online business directories.
