Food processing PLI attracts ₹9,207 crore investment, creates 3.35 lakh jobs
The government reported that the Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) has attracted ₹9,207 crore in investment, exceeding its committed target of ₹7,722 crore.
The scheme has generated an estimated 3.35 lakh direct and indirect jobs, well above its original target of 2.5 lakh.
163 applications from 127 companies, including 69 micro, small and medium enterprises (MSMEs), have been approved across 22 states and union territories at 212 locations.
Sales of PLI-supported food products rose from ₹58,758 crore in FY2019-20 to ₹1,08,854 crore in FY2025-26, with incentive disbursement of about ₹3,271.44 crore released up to June 2026.
The government said the scheme has also added roughly 34 lakh metric tonnes per annum of processing capacity and supported branding, innovation and value addition in the sector.
Production Linked Incentive (PLI) Scheme — Design and Rationale
The PLI scheme is a Central Sector scheme under which the government disburses cash incentives to eligible manufacturers based on incremental sales of goods manufactured in India over a defined base year, rather than on capital subsidy alone. It was conceived as a flagship instrument of the Aatmanirbhar Bharat (self-reliant India) initiative to boost domestic manufacturing, cut import dependence and create jobs at scale.
Key Details
- The umbrella PLI approach was first launched in March 2020, initially covering mobile manufacturing, electronic components, and medical devices.
- It was subsequently extended to 14 sectors — including pharmaceuticals, telecom, textiles, white goods, auto components, solar modules, drones, and advanced chemistry cell batteries — with a combined outlay of about ₹1.97 lakh crore.
- Incentives are tied to measurable performance criteria (incremental sales/investment), distinguishing PLI from earlier subsidy regimes that were not output-linked.
- The scheme for food processing is administered by the Ministry of Food Processing Industries (MoFPI) as a distinct, sector-specific PLI outside the ₹1.97 lakh crore umbrella outlay.
The food processing PLI illustrates how the PLI architecture — incentives linked to actual sales performance rather than upfront capital subsidy — has been extended beyond core manufacturing sectors into agro-processing, a sector UPSC frequently tests under GS3 industrial policy questions.
PLISFPI — Food Processing Industry Focus
The Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) was approved by the Union Cabinet on March 31, 2021, with an outlay of ₹10,900 crore, to be implemented over FY2021-22 to FY2026-27.
Key Details
- The scheme has three components: incentivizing manufacturing of four major food product segments (ready-to-cook/eat foods, processed fruits and vegetables, marine products, and mozzarella cheese, among others), supporting innovative and organic products of SMEs, and assisting branding and marketing of Indian food products abroad.
- Core objectives include creating global food manufacturing champions, strengthening Indian food brands internationally, raising off-farm employment, reducing food wastage through better storage and processing infrastructure, and ensuring remunerative prices for farmers.
- The scheme sits within a broader basket of food processing interventions, including the PM Kisan Sampada Yojana (umbrella scheme for mega food parks, cold chains, and agro-processing clusters) and the Operation Greens price-stabilisation scheme for select perishables.
- The Ministry of Food Processing Industries, a standalone Union ministry since 1988, is the nodal authority for the scheme.
The reported ₹9,207 crore investment and 3.35 lakh jobs are the mid-course performance outcomes of this specific PLISFPI outlay, and reflect the scheme moving past its original committed targets roughly midway through its six-year implementation window.
MSMEs in Food Processing and Value Addition
India is among the largest producers globally of milk, fruits, and vegetables, but only a modest share of this output is industrially processed compared to countries with mature food-processing sectors, resulting in high post-harvest wastage and limited value capture for farmers.
Key Details
- MSMEs are classified under the Udyam framework (revised in 2020) using investment and turnover thresholds — micro (up to ₹1 crore investment/₹5 crore turnover), small (up to ₹10 crore/₹50 crore), and medium (up to ₹50 crore/₹250 crore) enterprises.
- The PLISFPI's SME component specifically targets innovative and organic food products, recognising that MSMEs form the bulk of India's unorganised food processing base.
- Value addition through processing — such as converting perishable fruit into pulp, juice, or dried products — extends shelf life, reduces wastage, and allows better price realisation for farm produce.
Of the 127 companies approved under the scheme, 69 are MSMEs, indicating the scheme's stated MSME-support objective is reflected in actual scheme uptake, not just design intent.
- PLISFPI approved: March 31, 2021; outlay ₹10,900 crore; implementation period FY2021-22 to FY2026-27
- Investment attracted: ₹9,207 crore (against a committed target of ₹7,722 crore)
- Jobs created: approximately 3.35 lakh (against a target of 2.5 lakh)
- Applications approved: 163, from 127 companies (including 69 MSMEs) across 22 states/UTs and 212 locations
- Sales of PLI-supported products: rose from ₹58,758 crore (FY2019-20) to ₹1,08,854 crore (FY2025-26)
- Incentives disbursed: approximately ₹3,271.44 crore up to June 2026
- Processing capacity added: about 34 lakh metric tonnes per annum
- Nodal ministry: Ministry of Food Processing Industries