Agri-business and Food processing

SECTOR PROFILE

Table of Contents

1. Indiapreferred investment destination

2. Gujaratpreferred investment destination in India
3. Food & Agro sector
3.1 Indian overview
3.2 Gujarat scenario
4. Advantage Gujarat
5. Doing Business in Gujarat
6. Tax & regulatory framework in Gujarat

INDIA - PREFERRED INVESTMENT DESTINATION

1
01

INDIA - PREFERRED INVESTMENT DESTINATION

9th largest economy in the world

by nominal GDP and
rd
3 largest by purchasing
power parity (PPP)

Trade Scenario, USD billion

A.T. Kearney Survey

400

1.87

China

350

CAGR
Exports
14%

300
250

Recorded the highest growth

rates in the mid-2000s

FDI Confidence Index, 2012

CAGR
Imports
14%

1.73

India

200

1.6

Brazil

150
100

US

1.52

Germany

1.52

Growth

50

Decline

One of the fastest growing

economies in the world (GDP
growth rate 8.6% in 2011)

GDP growth rate

15.0%

9.5%

10.0%

9.6%

9.3%

1994-95

2000-01

Export

2004-05

2010-11

Import

India is one of the

major G-20 economies:
the 17th largest exporter and
11th largest importer in the world

8.6%

8.0%

6.8%

1990-91

1.5

FDI - Top Sectors

Automobile
industry
6%
Power
7%
Construction
activities
10%

Metallurgical Pharmaceuticals
industries
5%
5%

Petroleum
and natural
gas
3%

Services
30%

Main Export Partners

5.0%
0.0%
2006

2007

2008

2009

2010

2011-12
(A)

16%

2010-11
(Q)

17%

2009-10

17%

2008-09

18%

2007-08

19%

2006-07

20%
-

59%

25%

57%

26%

UAE
12%

China
8%

Hong Kong
4%

Main Import Partners

56%

26%

54%
400

Computer software
and hardware
11%

Telecommunications
12%

The 2nd preferred global

investment destination
(World Investment Prospects Survey
2010-2012 by UNCTAD)

56%

25%
26%
600

800

1,000

1,200

USD, billion
Agriculture

US
13%

58%

26%

200

Real estate
11%

2011

Sectors contribution to GDP

02

0.5

No Change

Industry

Services

China
12%

UAE Saudi Arabia US

7%
6%
6%

Australia
5%

USD 254 billion of FDI inflows

between April 2000 and
March 2012

ADVANTAGE INDIA

World's largest
democracy with
1.2 billion people

Land of abundant
natural resources
and diverse
climatic conditions

Enabling business
environment
with greater global
participation

Strong Market
Fundamentals

Access to
technology as
a result of the
IT revolution

Impetus on
Infrastructure
Development

Progressive
simplification and
rationalization of
direct and indirect
tax structures

Competitively
priced skilled
labour

03

GUJARAT - PREFERRED INVESTMENT

DESTINATION IN INDIA

2
04

GUJARAT HAS BEEN RANKED 1ST AS PER THE ECONOMIC FREEDOM RANKINGS
FOR THE STATES OF INDIA, 2012 REPORT

Double digit growth rate with Gross State

Domestic Product of USD 75 billion
(2010-11) growing at a five year average of
Growth in agricultural output in
the state over the last 10 years
A highly industrialized state - Gross State
Domestic Product contribution from
manufacturing sector

10%
11%
28%

Gujarats Degree of Openness

(ratio of exports from state to
Gross State Domestic Product)

53%

A state with a population of 60 million and

one of the highest urbanization levels

43%

Increase in seat availability in

technical institutions over last 3 years

A state with a high and

growing literacy rate
A state with one of the highest share in
investments under implemented projects
in India

100%
79%
26%
05

FOOD & AGRO SECTOR

3
06

FOOD & AGRO SECTOR INDIAN OVERVIEW

GUJARAT

INDIA

3.1
07

OVERVIEW
Worlds largest producer of milk and livestock, with an annual production of 122
Million Metric Tonnes (MMT) of milk with 528 million livestock
2nd largest producer of fruits and vegetables, producing 213 MMT
3rd largest producer of food grains, producing 250 MMT and fish production of 8.3 MMT
India produces 63 billion eggs, with 649 million poultry
Agriculture engages 70% of Indian population. Food Processing sector alone employs
13 million directly and 35 million indirectly (2010-11)
Agriculture contributes to 18% of Indian GDP. Food Processing contributes 14% of the
manufacturing GDP, which amounts to Rs. 2,800 billion. (2010-11)

Segments of the
Food & Agro Industry

Food Grains | Spices | Fruits & vegetables | Diary products | Meat &
poultry | Fisheries | Flowers | Processed foods & beverages

The Indian food market is slated to reach USD 300 billion in 2015
The Food Processing Industry is estimated to be worth around USD 67 billion and expected to increase to USD 175
billion by 2025
46 out of 60 soil types and 20 agri-climatic regions exist in India. India has 52% cultivable land compared to 11%
world average. India has 1.84 million sq.km of arable land, which is more than that in China, USA, Japan
India is among 15 leading exporters of agricultural products in the world
India's agricultural exports amounted to USD 23.2 billion with a 1.7% share of world trade in agriculture in 2010.
Exports of agricultural products are expected to account for 5%of the world's agriculture exports by 2014
Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI); IBEF; International Trade Statistics 2011, published by the World Trade Organization
(WTO); APEDA; National Institute of Food Technology Entrepreneurship and Management; Director General of Commercial Intelligence & Statistics

08

KEY SEGMENTS
Grains

Spices

Production of food grains during 2011-12 is estimated

at an all time record level of 250.42 MMT which is a
significant achievement mainly due to increase in the
production of rice and wheat.
India has emerged as world's top rice exporter
overtaking traditional leaders, Vietnam and Thailand.
India's total rice export in 2011-12 is expected to be
6.5-7 MMT , which is around 7% of the country's total
production.
Indian annual
production
(2010-11)

Projected
demand in
2020

Rice

95

123

Wheat

86

101

Pulses

18

41

Soyabean

13

13

Production
in MMT

India produces a wide variety of spices like black

pepper, cardamom, ginger, garlic, turmeric, chilli
and a large variety of tree and seed spices.
The total production of spices was 4.0 MMT and the
area covered was 2.5 million hectares.
India is the largest producer of ginger.
Spice Board of India plans to promote exports of
spices by establishing 25-30 spice parks in different
parts of the country. This will help in achieving
export of spices worth USD 5.6 billion (Rs 30,000
crore) by 2020.

India can move from self reliance

in food to being a major exporter
of agri products

Sources: Department of Agriculture and Cooperation, GoI; IBEF; FAPRI Agri Report, 2009
09

KEY SEGMENTS
Share of Indian production of fruits & vegetables
compared to global production
100%
80%
60%

41%

40%

23%

30%

24%

36%

10%

20%
0%
Mango

Banana

Cashew nut
India

Onion

World

Cauliflower Green Peas

Indias export (2010-11)

India exported fruits &
vegetables worth Rs.38.56
billion which comprised of fruits
worth Rs.26.35 billion &
vegetables worth Rs.12.21
billion.

India is the second largest producer of fruits and vegetables in the world, after China
Vegetables
India accounts for about 15.5% of the 890 MMT of total global vegetable
production.
India is the largest producer of okra amongst vegetables & ranks second in
production of potatoes (10%), onions, cauliflowers, brinjal, cabbages, etc.

Fruits
China, India, Brazil, US, Italy, Spain, Mexico, Iran, Philippines and France are the
top ten aggregate fruit producers
India accounts for about 10% of the 500 MMT of total global production of fruits
(excluding melons)
India is the largest producer & consumer of cashew nuts
India is the third largest producer of coconut and leads 90 coconut-producing
countries of the world, producing 11 MMT (2010-11)
The vast production base offers India tremendous opportunities for export.
During 2010-11, India produced 75.8 MMT of fruits and 137.7 MMT of vegetables. The area under cultivation of fruits
stood at 6.6 million hectares while vegetables were cultivated at 8.2 million hectares.
Sources: APEDA, Department of Agriculture and Cooperation, GoI;

10

KEY SEGMENTS
Dairy

India is the largest producer of milk in the world.

In 2011, the production was 122 MMT. The production level is expected to
reach 180 MMT by the year 2021-22
Indian Milk production contributes to 15% of global milk production.
The market size of Indian Dairy Industry is estimated at around USD 60
billion (INR 2,662 billion).
The organized cheese market including its variants of processed cheese
is valued at around Rs. 4.50 billion.
French cheese major, Fromageries Bel, a 10-billion French franc outfit, has
entered the Indian market with La Vache Kirit or what is worldwide known
as The Laughing Cow

The dairy industry must

respond to the rapidly growing
demand for milk as the
projected demand of 180
million Tonnes by 2021-22
would require our annual
increase in milk production,
which has been growing at 2.5
MMT to 5 MMT
- Dr Amrita Patel,
Chairman, National Dairy
Development Board (NDDB).

Meat & poultry

India has a large livestock base constituting 304.8 million
livestock including 199.1 million cattle, 105.3 million
buffalo, 71.6 million sheep and 140.5 million goat.
The livestock population is projected to increase to 322
million by the year 2015.
India ranks second in goat population around the world
with goat population share of 25% in India's Livestock
population.

Indian Poultry Industry is booming and emerging as

the world's 2nd largest market.
India produces 63 billion eggs and 649 million
poultry.
India is the Ninth largest producer of poultry meat
with a production of 2.5 MT of poultry meat.
The market size for Poultry Industry is estimated at
around USD 7.9 billion (INR 350 billion) and is growing
at an attractive rate of 12%-15% annually.

Sources: GAIC
11

KEY SEGMENTS
Flowers

India earned USD 48.5 million (around Rs 215.27 crore) from

exports of flowers to over 90 countries during 2010-11 (April to
December)
Flower production in India was spread over 0.18 million hectares
with a production (2010-11) of 1 MMT of loose flowers and 69
million tonnes of cut flowers.
Major importers of Indian flowers are USA (5,830 MT), Germany
(3,587 MT), Netherland (2,334 MT), United Kingdom (3,273 MT) and
United Arab Emirates (618 MT) and Pakistan (2 MT).

Major flower importing countries

Sources: Department of Agriculture and Cooperation, GoI; Indian Express

12

KEY SEGMENTS
Processed food
The Food Processing Industry is estimated to be worth around USD 67
billion and expected to increase to USD 175 billion by 2025

Crop Cumulative
wastage

The Processed Food sector has a potential of attracting USD 33 billion

investment

Cereals

About 6% of the total Indian produce is processed

Oil seeds

There are over 25,000 registered units in the food sector with investments
of Rs 840 billion

Fruits & Vegetables

Value of Exports of food processing

related commodities
70,000

3.9
6.0%
4.3-6.1%
6.00%
5.8 -18.0%

Milk

0.80%

Fisheries

2.90%

Meat

2.30%

Poultry

3.70%

63,733

60,000

49,352 50,759

50,000
Rs. crore

Pulses

(%)

Year

43,783

40,000

34,204

30,000
19,257

23,685 23,766

26,802 29,211

FDI in
Food
Processing
(in Rs Cr.)

20,000

2004 -05

174

10,000

2005 -06

183

2006 -07

441

2007 -08

632

2008 -09

456

2009 -10

1314

2010 -11

858

1
01

-1

0
-1

-0

01
20

01

20

8
-0
20

-0

01
20

01
20

20

01

-0

5
-0

01

-0
01

20

-0
20

01
20

20

01

-0

Ministry of Food Processing Industries (MoFPI) through its Vision 2015

envisages
Increasing the level of processing of perishables from 6% to 20%;
Raising value addition from 20% to 35%
Enhancing Indias share in global food trade from 1.5% to 3.0%

Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI); IBEF; APEDA; National Institute of
Food Technology Entrepreneurship and Management; Director General of Commercial Intelligence & Statistics
13

GOVERNMENT SUPPORT & ENABLERS

Union Budget 2012-13
The Government of India's focus in the 12th Five Year Plan will be
"mechanization of agriculture"

The target for agricultural credit in 2012-13 has been raised to

Rs. 575,000 crore (USD 107.4 billion). This is an increase of Rs. 1 lakh crore
(USD 18.7 billion)
The total plan outlay for agriculture and cooperation has been increased
by 18% from Rs. 17,123 crore (USD 3.2 billion) in 2011-12 to Rs. 20,208
crore (USD 3.7 billion) in 2012-13
The allocation for Rashtriya Krishi Vikas Yojna was also increased by 17%
to Rs. 9,217 crore (USD 1.7 billion)
A short term RRB Credit Refinance Fund was proposed. Also Kisan Credit
Card Scheme is to be modified to make it a smart card which can be used
at ATMs
A new centrally sponsored scheme-National Mission on Food
Processing is to be started in cooperation with States in 2012-13
Proposal made to allocate Rs 300 crore (USD 56 million) to Vidarbha
Intensified Irrigation Development Programme under RKVY.
Interest subvention scheme for providing short term crop loans to
farmers at 7% interest per annum would be continued in 2012-13.
Additional subvention of 3% is to be made available for prompt paying
farmers
Rs. 2,242 crore (USD 418.63 million) project launched with World Bank
assistance to improve productivity in the dairy sector
Rs. 500 crore (USD 93.36 million) proposed to be provided to broaden
scope of production of fish to coastal aquaculture
Sources: Union Budget 2012-13

14

GOVERNMENT SUPPORT & ENABLERS

Food processing industries have been put in the list of priority sectors for
bank lending implying easier availability of credit

External Commercial Borrowings available for cold storage projects

Automatic approval for foreign equity up to 100% is permitted for most
of the processed food items
The Government proposed to reduce basic customs duty from 7.5% to
2.5% on sugarcane planter, root or tuber crop harvesting machine and
rotary tiller and weeder and parts for the manufacture.
Fringe Benefit Tax on food processing is abolished.
Investment linked tax incentives are extended to cold chains and
warehousing of agricultural products.
Creation of NABARDs fund for funding the sector.
The NABARD has increased financial assistance in Gujarat by 50% in 201112, to touch Rs 4,340 crore (USD 810 million) as compared to Rs 2,894
crore (USD 540 million) in 2010-11
Customs duty and excise duty reduced progressively on machinery and
other inputs
30 Mega Food Parks have been approved, out of which 15 are ongoing
projects

Sources: Ministry of Food Processing Industries (MoFPI); The Times of India

15

INVESTMENT TRENDS
The Centre has set an investment target of USD 18.9
billion (Rs. 100,000 crore ) by 2015 in the Food Processing
sector

The Government of India has approved setting up of 15

Mega Food Parks (apart from ongoing 15 MFPs) under
Infrastructure Development Scheme, with a total grant of
USD 149 million (Rs. 787.50 crore), during the 11th Five Year
Plan

4,500

4,031

4,000
3,500

In Rs. crore

There are 25, 367 registered food processing units in the

country whose total invested capital is USD 15.9 billion
(Rs. 84,094 crore )

Plan allocations through Five Year Plans in

Food Processing

3,000

2,613

2,500
2,000
1,500
1,000

650
180

500
Total Plan allocation

10th five year plan

Allocation for infrastructure

development

11th five year plan

The 30 Mega Food Parks will help 20,000 SMEs engaged in

the manufacturing and processing of food products every
year.
The Ministry of Food Processing Industries has allocated
USD 112 million (Rs. 595 crore) for different schemes to be
implemented in the food processing sector during 2011-12
An Inter-Ministerial Task Force on Agricultural Marketing
Reforms, constituted by the Union Ministry of Agriculture,
had recommended the creation of additional cold chain
facilities with an investment of USD 473 million (2,500
crore)

The major infrastructure

envisaged under the 11th
Five Year Plan

FDI: The food processing

industries in India have attracted
Foreign Direct Investment (FDI)
worth USD 1.3 billion from April
2000 to September 2011.

Mega Food Park scheme (Rs. 15.75 billion)

Modernization of abattoirs (Rs. 8.28 billion)
Integrated cold chain facilities (Rs. 2.10 billion)

Sources: Ministry of Food Processing Industries (MoFPI); IBEF; India Food Report 2008; 11th Five Year Plan

16

POLICY INITIATIVES
Food processing industries have been put in the list of priority sectors for
bank lending implying easier availability of credit
Most of processed foods are exempted from the
purview of licensing under the Industries Act
Food processing industries are included in the list of
priority sectors for bank lending (Budget 2001-02)
Automatic approval of foreign equity up to 100% is
available
Excise Duty on processed fruits and vegetables has
been brought down from 16% to 0%
Income Tax Holiday was announced for certain
categories of food processing industries (Budget
2004-05).
Excise Duty has been waived off on milk products
and poultry and Excise Duty on aerated drinks has
been reduced to 16% from 24% (Budget 2006-07).
Excise Duty on Ready to Eat packaged foods and
Ready to Mix food items has been reduced to 0%
from 8% (Budget 2007-08).
Customs Duty of Food Processing machinery has
been reduced to 5% from 7.5%.

Excise Duty on refrigerated motor vehicles (reefer

vans) has been reduced from 16% to 8%.
Customs Duty on refrigerated motor vehicles has
been waived off.
Exemption limit of Excise Duty for small scale
industries has been raised from Rs. 10 million to
Rs. 15 million
All services provided by Technology Business
Incubators and their Incubatees whose annual
business turnover is less than Rs. 50 lakh have
been exempted service tax for the first 3 years.
Project import status with concessional import
duty of 5% and full exemption of service tax for
installation and commissioning of mechanized
handling systems, pallet racking systems and
warehouses.
Project import status with concessional import
duty of 5% and full exemption of service tax to
the initial setting up and expansion of cold
storage, cold rooms including farm pre-coolers
for preservation or storage of agricultural /
related sector produce; and processing units for
such produce

Sources: Annual Report 2010-11, Ministry of Food Processing Industries (MoFPI);

17

FOOD & AGRO SECTOR GUJARAT SCENARIO

3.2
18

OVERVIEW
Gujarat tops the agriculture growth table in the country growing
at a CAGR of 10.7% over the last decade.
14.6

120,000
110,000
14.7

30

12.5

80,000

25

Rs. Crore

70,000

20.9
107,253

60,000
50,000
40,000

14.5

14.5

10,000

25,582
23,222

2004-05

15.9

14.1

15

78,143

30,000
20,000

20

18.2
13.5

32,940
28,577
2005-06

38,162
27,815
2006-07

hectares were

15.2

48,441

53,333

47,540

47,092
32,408
2007-08

28,506
2008-09

10

Share of the sector as a % of GSDP

90,000

16.5
15.2

Scheme 3.2 lakh

35

14.2

100,000

Under the MIS

40

covered and 2.0 lakh

farmers benefitted
during 2005-11
period.
Farmers had an
additional income of
Rs. 946 crore during
2005-11 due to MIS

0
2009-10

2010-11

Agriculture contribution to GSDP at Current Prices In Rs. Crore

Agriculture contribution to GSDP at Constant Prices (2004 -05) In Rs. Crore
Agriculture contribution to GSDP at Current Prices % of total GSDP
Agriculture contribution to GSDP at Constant Prices (2004 -05) % of total GSDP

Out of the total geographical area of 196 lakh hectares

in Gujarat, total cropped area is around 128 lakh
hectares (65%).
Gujarat has seven agro-climatic zones and wide
varieties of soil
The production of total food grains during 2010-11 is at
10.1 MMT as against 5.6 MMT in 2009-10.
The production of cotton during 2010-11 is at 9.8

million bales as against 7.4 million bales in 2009-10.

The major vegetables grown in Gujarat are Onion,
Potato, Brinjal, Tomato, Okra and Cucurbits.
The State mainly produces spices viz. Cumin, Fennel,
and Garlic.
GoI and GoG have spent Rs. 8530 million during
2005-2011 under Micro Irrigation System (MIS)
Scheme

Sources: Socio Economic Review 2011-12 of Gujarat; Department of Agriculture and Cooperation, GoI; Gujarat Green
Revolution Company Ltd.
19

KEY SEGMENTS
Food Grains

Cotton

There is an increase of 79.65% in food grain production

in 2010-11 over the previous year 2009-10
The productivity of food crops is estimated at 20.03
MT/Hectare

The production of cotton during the year showed an

increase of 32.75 percent in 2010-11 over the previous
year.

Area in HA & production in 000 tonnes

Production of cotton in Gujarat

6,000

1800
1600

9,825

5,000

1400

7,876

4,000

1200
1000

3,000

800

2,000

600
400

8,276
7,014

6,872
5,444

1,906

2,011

2,372

2,422

2,354

2004 - 05

2005 - 06

2006 - 07

2007 - 08

2008 - 09

2,464

2,623

1,000

200
0

Rice

Wheat

Area in 2009 -10

Production in 2009 -10

Jowar

Bajra

Area in '000 hectares

2009 - 10

2010 - 11

Production in '000 MT

Area in 2010 -11

Production 2010 -11

The production of total food grains during the year 201112 is estimated at 10.1 MMT against the production of 5.6
MMT in 2009-10

The production of cotton in Gujarat amounts to 31% of

production in the country.

Sources: Socio Economic Review 2011-12 of Gujarat; Previous Socio-Economic Reviews

20

7,401

KEY SEGMENTS
Fruits, vegetables & spices
The growth in vegetable production was the highest and recorded 45% growth in volumes in
2011-12 as against 2008-09 production figure

State is in leading position in production of

Onion,Potato, Banana, Lime and Papaya
The average productivity of vegetables is estimated at
18.95 MT/Hectare

The famous kesar variety of mango in Gujarat, known as

Gir Kesar mango, has been granted Geographical
Indication tag, thus making it the second mango variety
in India to have such distinction.

Gujarat has the highest productivity in custard and

guava production in India
Worlds largest producer of cumin
The state also enjoys leading position (1st rank to 4th
rank) at all-India level in the productivity levels of major
fruits and vegetables including onion, potato, banana,
guava, tomato, lime, papaya, etc.

Production in lakh tonnes

80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0.0

69.9
60.0

78.4
68.1

72.6 73.6

9.1 9.4 9.5

Fruits
2008 -09

Vegetables
2009 -10

Spices
2010 -11

At all-India level, the State contributes 14 percent to 20 percent share in major fruit and vegetable crops like;
Papaya, Sapota, Onion, Banana and Lime.
Sources: Socio Economic Review 2011-12 of Gujarat; Department of Horticulture, Gujarat; Agriculture and Cooperation
Department, Gujarat.
21

KEY SEGMENTS
Flowers

60,000

Production of flowers in Gujarat in 2010 -11

Major flowers grown in the state are Roses Lily,

Marigold, Jasmine, Tuberose. Flowers like Dutch Roses,
Gerberas and Carnation are being grown.

49,562

50,000
40,000
30,939

30,000

26,044
18,030

20,000
10,000

3,978

5,496

597

3,204

3,209

1,699

Flowers grown in south Gujarat are sold in the world's

biggest flower markets of Amsterdam in Holland and
London in United Kingdom on a regular basis.

Rose

Merigold

Area in hectares

Mogra

Lilly

Others

Production in MT

During 2010-11 the production of flowers was 1.3 lakh

tonnes, spread over 15,000 hectares
State has taken a lead in the sector of establishing
Green House by producing high value flowers like
Dutch Roses, Gerberas and Carnation. Government of
Gujarat offers 50% subsidy for setting up green
houses

Different varieties of Dutch roses that are being grown

in the green houses of Mahudi, Vyara, Bagumara and
Bardoli reach the markets in Tokyo, Dubai and those in
European countries via Amsterdam every week.
Three firms from south Gujarat export as much as 1.5
lakh Dutch roses from the state. One of these also
exports 50,000 Gerbera flowers to London.

Sources: Socio Economic Review 2011-12 of Gujarat; Department of Horticulture, Gujarat; Agriculture and Cooperation
Department, Gujarat. The Times of India
22

KEY SEGMENTS
Fisheries
Total Coastal Belt

1,600 Km

Inland Reservoirs

3.54 lakh ha

Major fish categories

Marine

Small Sciaenids, Bombay Duck,

Ribbon Fish, Catfish, Promfret

Inland

Katla, Rohu, Mrigral

Value of Fish Production in 2010-11 was Rs. 41.51 billion

Gujarat ranks first among the states in marine fish
production and exported 1.98 lakh tonnes of marine
products worth Rs. 2,156 crore in 2010-11

Gujarat contributes 28% of the national

marine export in quantity and 15% in
terms of value

Marine fish production in Gujarat in MT

During the year 2010-11, the total fish production

in Gujarat has been estimated at 7.75 lakh tonnes
The area of continental shelf is estimated at
164,000 sq.km and is 32.54 % of the shelf area|
of India

6,80,000

Production in MT

Fishing fleet have increased up to 35,275 (2011) of

which 23,066 were mechanized and 12,209 were
non-mechanized

7,00,000

6,60,000
6,40,000
6,20,000
6,00,000
5,80,000
5,60,000
5,40,000
5,20,000

05

4-

0
20

06

5-

0
20

07

6-

0
20

08

7-

0
20

09

8-

0
20

10

9-

0
20

-1

10

0
20

Source: Socio Economic Review 2011-12 of Gujarat; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat
23

KEY SEGMENTS

Animal husbandry
Animal husbandry plays a vital role in Gujarats rural economy, while
contributing nearly 5% to the state GSDP
Cow

Gir, Kankarej

Buffalo

Jafrabadi, Mehsani, Surti

Sheep

Patanwadi, Marwadi

Goat

Surti, Mehsani, Kutchchi, Zalawadi,

Gohilwadi

Projects (ICDP) with 1078 Breeding Centres in the

Horse

Kathiawadi, Marwadi

state which are aimed at improving the breed of

Camel

Kutchchi

Gujarat has 23 Intensive Cattle Development

cattle and buffaloes

Gujarat has 12 Intensive Poultry Development
Projects (IPDP), 5 District poultry Extension Centres,
and 85 Poultry Service Centres
As per the provisional results of livestock* census

Major Livestock Products

2007, total livestock population of Gujarat was

237.94 lakh
As per the estimates of the Integrated Sample Survey
(ISS) of major livestock products, the production of
milk has increased to 93.21 lakh tonnes in 2010-11 as
against 88.43 lakh tonnes in 2009-10

2008-09 2009-10 2010-11

Milk
(In million tonnes)

8.38

9.32

Eggs
(In million numbers) 1267.50 1276.20

1326.90

Wool
(In million kilos)

2.92

2.85

Source: GAIC; Socio Economic Review 2011-12 of Gujarat; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat

24

8.84

2.92

KEY SEGMENTS

Dairy
Gujarat Cooperative
Milk Marketing
Federation (GCMMF)

17 Cooperative dairy plants & 25

State level apex body of milk cooperatives in Gujarat

aims to provide remunerative returns to farmers

private dairy plants

Gujarat
Dairy
Facts

and also serve interest of consumers by providing

14,598 Milk Cooperative Societies

quality products which are good value for money.

115 lakh liter/day milk production

I n d i a' s l a rg e s t fo o d p ro d u c t s m a r k e t i n g
organisation. Dairy No. 1 in Asia and Dairy No. 2 in the

3.01 million of milk producers

world
GCMMF has received the APEDA Award from

Production of milk in lakh kgs

Government of India for Excellence in Dairy Product

2009-10

234 1415

2008-09

231 1192

2007-08

248 957

5514

1978

2010-11 235 1593

Exports for the last 13 years.

Milk Collection (Total - 2010-11) - 3.45 billion litres

5285

1912

Milk collection (Daily Average 2010-11) 9.45 million

5110

1851

litres (peak 12 million)

4857

1850

During the year 2010-11 export turnover was of

0
Goat

2000

4000

Cross-b red cow

6000
Indigenous cow

8000

10000

Rs. 98 crore

Buffalo

Source: GAIC; Directorate for Animal husbandry, cow breeding and fisheries, Gujarat

25

CENTRAL GOVERNMENT INITIATIVES

National Horticulture Mission (in effect till XI plan) with
main thrust on augmenting production of all
horticultural products (Fruits, Vegetables, Flowers,
Plantation crops, Spices, Medicinal Aromatic plants) in
the states.
Schemes for Agri Infrastructure like Mega Food Parks,
Cold Chains, modernization of Abattoirs
Scheme for technology upgradation and
establishment and modernization of food processing
industries.
Scheme for quality assurance, codex standards, R&D
and other promotional activities.
Strengthening of institutions like Indian Institute of
Crop Processing Technology

Under the Kisan Credit Card

Scheme which was
introduced in 1998-99, total
accounts have increased to
27.02 lakh with an amount
of Rs.16,067 crore (till
September 2011).

Keen implementation of other

GoI initiatives: NFSM, ATMA
Rashtriya Krishi Vikas Yojana (introduced in 2007, valid till 2012)
District wise State plan scheme to incentivize the States that increase
their investment in Agriculture and allied sectors
Under this scheme subsidy is provided to Agriculture Produce Market
Committees for Cold-Storage, Godown, Solid Waste Management and
New Market Development.

Source: Socio Economic Reviews of Gujarat; Ministry of Food Processing Industries (MoFPI)

26

The public sector banks have

been formulating Special
Agricultural Credit Plans (SACP)
since 1994-95 to improve credit
flow to the agriculture sector.

STATE GOVERNMENT INITIATIVES

The Eight Krushi Mahotsav 2012 was started on 24 April 2012
An assistance of worth Rs.720 crore has been given to around 15.17 lakh famers in 25
days. Assistance for purchasing 11,000 tractors and 34,00 rotavators was also given.
225 talukas and 4397 village clusters were visited with 4400 Krishi Raths.
Around 3.5 lakh soil specimens were tested in laboratory .
2.75 lakh soil health cards were given.
40 lakh animals were vaccinated and around 4.5 lakh animals were treated for
diseases
National Agricultural Insurance Scheme -(NAIS/Rashtriya Krishi Bima Yojana) Gujarat State ranks first with
respect to risk covered (Sum Insured), premium income, subsidy paid, farmers covered and claims paid under NAIS
among the implementing States.
Gujarat Green Revolution - GGRC is aimed to provide
professional services on Micro Irrigation System coupled
with required equipments and essential agro inputs to the
farmers of Gujarat

Soil Health Cards (SHCs) under the Soil Health Programme of the Agriculture Department: The SHCs are
prepared after the soil is tested scientifically for various properties like productivity, mineral composition, water
retaining capacity and others. The SHCs also contain information on what kind of pesticides, fertilisers, seeds and
how much water should be used to get better productivity from the land. These details would help farmers take
accurate action to increase productivity of the land. Till December 2011, 38.20 lakh SHCs were distributed to
farmers. 2.75 lakh SHCs were given during Krushi Mahotsav 2012
Soil and water testing laboratories and Krushi Vigyan Kendra (KVKs) Support
The State Government initiatives like Krushi Mahotsava, have put Gujarat in a leading position in Onion, Potato,
Banana, Lime and Papaya production. State has taken a lead in establishing Green House for producing high
value flowers like Dutch Roses, Gerberas and Carnation
Sources: Agriculture and Cooperation department, Gujarat

27

STATE GOVERNMENT INITIATIVES

Kisan Credit Cards: The Gujarat Government has initiated a programme to cover all
its farmers under the Kisan Credit Cards issued by commercial banks which aims at
augmenting their borrowing capacity from banks and will also take care of their
day-to day needs. The Government has directed all officials to cover those farmers
who have so far not been issued Kisan Credit Cards
Farm Accident Insurance Scheme

Framing of Bio-technology Policy & Agri Business Policy

Gujarat Comprehensive Community Accidental

Policy for waste land utilization

Insurance Scheme
Gujarat Agro Industries Corporation (GAIC) Promotes agricultural activities at the ground

Financial assistance up to Rs 75 lakh is made available to

educational institutions in food technology for starting
the course as well as for up gradation.

level and helps in development of agro industries

At the end of year 2010-11, 205 Agriculture Produce

and accelerates demand-based production of

Market Committees (APMCs), 199 Main Yards of Market

agro products to develop agro industries in the

Committees and 201 Sub Market Yards were

new global agricultural environment.

operational in the State.

Three phase 247 electricity supply to all villages

(Jyotigram Yojna)

37 APMCs connected by futures market through

NMCDX

Enabling of Contract Farming

Gujarat State Horticultural Mission (GSHM), a registered society has been formed for implementation of
National Horticulture Mission (NHM) in the state, with a view to double the horticulture production and income
by the year 2012 by adopting end-to-end approach with simultaneous development of post harvest infrastructure
and marketing facilities. The Mission is being implemented in 15 potential districts and covers 10 important
crops of the state viz. mango, chikoo, amla, banana, papaya, lime, cumin, fennel, flowers, medical and aroma crops.
Sources: Agriculture and Cooperation department, Gujarat

28

EDUCATIONAL INFRASTRUCTURE

Junagadh Agricultural University

Anand Agricultural University

Has colleges offering courses in

agriculture, Agricultural Engineering
and Technology and fisheries,
Veterinary Science and Animal
Husbandry.

It was set up to provide education support to

the farming community in areas such as
Agriculture, Horticulture, Engineering,
Information technology and Business Studies.

Offers MBA in Agri Business

Management

It aims to promote development in rural areas

through education, research and
support services

Kamdhenu Veterinary University

It was set up in 2009-10 for the development of research, education, and extension in the
field of Animal Husbandry, Diary Development and Fisheries
Has established Diary Science College and Livestock Inspector Training Centre

Sardarkrushinagar Dantiwada Agricultural University

Offers courses in faculties such as agriculture,

horticulture, veterinary science and animal husbandry,
home science and nutrition, diary science and food
technology

Navsari Agricultural University

Has faculties of agriculture,

horticulture, veterinary
science and forestry

Offers a course in Agri Business Management

Indian Institute of Management Ahmedabad offers a two-year Post-Graduate Programme

in Agri-business Management (PGP-ABM)

Source: Websites of the universities; GAIC; Agriculture and Cooperation department, Gujarat;

29

TREND IN INVESTMENTS

The State has received cumulative

foreign direct investment (FDI) inflows
across all sectors worth USD 7.2 billion
during April 2000 to April 2011
690 MoUs & Announcements were
signed in Vibrant Gujarat 2011 for
projects to be established in the Food
and Agri sector
Proposed investment INR 34,851
crore
The average investment per MoU is
about Rs. 50 crore

Source: iNDEXTb

30

INVESTMENT OPPORTUNITIES

Mega Food Park Scheme of India (MFPS)

MFPS is expected to facilitate the achievement of
the Vision 2015 of Ministry of Food Processing
Industries to raise the processing of perishables in
the country from the existing 6% to 20%, value
addition from 20% to 35% and the share in global
food trade from 1.5% to 3% by the year 2015. The
present scheme/benefits of Mega Food Park of
Government of India will be extended to the Mega
Agribusiness Parks be developed in Gujarat over
the next 3 years.

Agri / horticulture infrastructure projects: cold

storage, fresh fruits and vegetables pack house,
mechanized grain handling and storage at port, Food
Parks, terminal markets, irradiation centers.
Export-oriented processing
Value added processing based on local resources
Natural resources based opportunities: natural
food colors, medicinal herbs extraction, tree oil
based bio-pesticides, Food Processing enzymes
and so on.
Newer technology based projects/opportunities

Horticulture related industries in State

Onion dehydration units | Mango pulp and pickles units | Canned vegetables | Potato flakes |
Tissue culture laboratories | Nurseries | Spices and psyllium processing units | Cold storages

Sources: Ministry of Food Processing Industries

31

KEY INDUSTRY PLAYERS IN GUJARAT

32

GUJARAT FOOD & AGRO SECTOR SUCCESS STORY

Amul: the brand that spurred a white revolution in India

Dairy No. 1 in Asia & Dairy No. 2 in the world

The key success factors are strong supply chain & distribution network,
diversified product line, low cost strategy, adoption of technology
& e-initiatives

Formed in 1946, managed by Gujarat Cooperative Milk

Marketing Federation limited (GCMMF)
The Amul model has helped India to emerge as the
largest milk producer in the world. More than 13 million
milk producers pour their milk in 1,28,799 dairy
cooperative societies across the country.
GCMMF has received the APEDA Award from
Government of India for Excellence in Dairy Product
Exports for the last 13 years.
Amul has more than 150 chilling centres in villages
Exports to Mauritius, UAE, Bangladesh, Australia, China,
South Africa, Singapore, Malaysia, Nepal, Pakistan,
Hong Kong & USA

GCMMF has been accorded a "Trading House" status

GCMMF is India's largest food product marketing
organization with annual turnover (2010-11)
US$ 2.2 billion (Rs. 9,774 Crores)
Aims for a turnover of 27,000 crore by 2020
Total Milk handling capacity per day - 13.67 million
litres
Milk Collection (Total - 2010-11) - 3.45 billion litres
Milk collection (Daily Average 2010-11) - 9.2 million
litres (peak 12 million)
During the year 2010-11, achieved export turnover of
Rs. 98 crore
Has 5 lakh distribution centres in the country

Sales in USD billion

2.5

2.2

2.0
1.3

1.5
1.0
0.5

0.6 0.6 0.7

0.5 0.5 0.5 0.5 0.5
0.4 0.4 0.5

0.9

1.5

1.7

1.1

19

94
19 -95
95
19 -96
96
19 -97
97
19 -98
98
19 -99
99
20 -00
00
20 -01
01
20 02
02
20 -03
03
20 04
04
20 05
05
20 -06
06
20 -07
07
20 -08
08
20 -09
09
-1
20 0
10
-1
1

0.0

Future:
Amul has signed an agreement with Walmart
to stock its products in Walmart stores in USA
Looking to offer low-fat version of its products
Planning to enter Japan and Sri Lanka
Has tied up with Glaxo to sell baby food

Sources: www.amul.com

33

GUJARAT FOOD & AGRO SECTOR SUCCESS STORY

McCain

McCains journey to success began in 1997 when it made its entry into India
with a proposal to invest Rs.1 billion (USD 25 million) in potato fry business.
McCain-McDonalds Indias initiative with Gujarat farmers has grown into a
unique technology driven enterprise

McCain is the most famous Canadian brand

name in the world, which manufactures frozen
food products, such as French fries, appetizers,
pizzas, vegetables, desserts, juices, entrees and
oven meals.
2006 Plant opened in Gujarat to produce retail
and food-service French fries, and potato
specialties. Among the potato specialties the
plant eventually produced a number of popular
Indian style potato snacks.
The plant supplies markets in Sri Lanka, Pakistan,
Bangladesh and Nepal, as well as India and
exports 10-15% of its output to South and
South-East Asian countries and the Middle East.
McCain Foods sources significant share (nearly
85%) of the potatoes needed for manufacturing
its products from Gujarat itself. It has
undertaken potato contract farming in various
parts of north and central Gujarat.
Sources: Business Standard

34

McCain Foods India (MFI) processes and

supplies frozen potato products from its $14.6
million plant on the National Highway number 8
that connects Delhi and Mumbai. The plant is
located 60 km away from Ahmedabad, enroute
to Mehsana.

The potato consumption

of McDonald India is almost
entirely met by McCain Foods

GUJARAT FOOD & AGRO SECTOR SUCCESS STORY

Desai Fruits and Vegetables (DFV)

Desai Fruits and Vegetables is re-engineering the Indian agro landscape by

pioneering new techniques and concepts in farming & packaging to make
available quality agro products to the world.

In 1999 - Ajit Desai, a simple farmer with a vision

seeded an ambitious enterprise in Amadpore, a
small village in Gujarat to tackle the problem of
lack of proper facilities, infrastructure and counsel
for the Agricultural sector in India. This movement
is today redefining the norms and introducing
world-class concepts in cultivating, packaging
and supplying fruits and vegetables in India.
DFV provides a wide range of high quality tropical
fruits and vegetables. The product portfolio
includes over 10 types of fruits and 30 types of
vegetables. However, the key focus of DFV over
the years has been on four key products: Banana,
Mango, Pomegranate and Grapes.
Desai Fruits and Vegetables has integrated pack
houses located at Navsari and Bharuch in Gujarat
and Baramati, Nasik and Karad in Maharashtra.

With a group of over 2500 small and medium sized

farmers, DFV has created an eco-system that
provides natural and fresh fruits and vegetables.
In April 2006, Contract Farming India AG, a
company based in Zug, Switzerland had taken up
a strategic stake in Desai Fruits and Vegetables.
DFV is certified to ISO 22000 and BRC standards.
Also, its farmers are getting certified to Eurepgap
standards. Mango and grapes farmers are already
certified and all the pomegranate farmers are
expected to be certified.
The pack-house is APEDA recognized and enjoys
IRW and WFLO memberships. The Company has
been approved by China for Mango and enjoys
protocol between APEDA and DCS.

Sources: http://www.desaifv.com

35

GUJARAT FOOD & AGRO SECTOR SUCCESS STORY

Riddhi Siddhi Group

Riddhi Siddhi Gluco Biols Ltd.(RSGBL) is one of the largest wet corn miller in India.
RSGBL is known for innovations and excellence in the field of transforming Corn
(maize) crop into essential industrial raw materials, adopting the most modern
technologies.

Incorporated in 1990, Riddhi Siddhi Gluco Biols Ltd is a

leading manufacturer of starch and starch derivatives. The
Company is promoted by the Ahmedabad-based
Chowdhary family, traditionally engaged in trading sago and
tapioca starch
RSGBL owns four state-of-the-art strategically located plants
across India, at Gokak (Karnataka), Viramgam (Gujarat),

French company Roquette Freres, one of

the largest maize starch manufacturing
companies in the world, has acquired a
14.9 % strategic stake in RSGBL

Puducherry (Pondicherry UT) and Pant Nagar (Uttrakhand)

RSGBL is an ISO 9001-2000 and ISO 22000 certified
organization
The company is managed by more than 1600 employees; its
stocks are listed and actively traded in the stock exchange
RSGBL has its export presence across 25 countries
RSGBL has enhanced its installed capacity more than 20-fold
in 15 years - acquired two multi-national corn processing
units (Glaxo Smithkline and Hindustan Unilever)

36

RSGBL production unit at Viramgam, Gujarat

GUJARAT FOOD & AGRO SECTOR SUCCESS STORY

Balaji Group

Balaji Group has pioneered the concept of potato wafers manufacturing by

focusing on customers taste and requirements. The company has almost
90% market share of Gujarats wafers market and 70% market share of
states namkeen (snacks) market.

In year 2003 Balaji Group introduced the biggest fully automated Potato processing machinery plant
in India which can process 4500 kg. potato and make 1200 kg. of chips per hour.
Balaji has established a very strong network of distributors across the state of Gujarat, to ensure
supply of fresh products across the state within 24 hours.
The company strongly believes in Value for Money strategy, ensuring great quality and taste and
distributing sufficient dealer margins
Balaji Group largely focuses on continuous R & D, to keep their products suited to the changing
demands of the customers.

37

ADVANTAGE GUJARAT

4
38

GUJARAT THE STATE WITH STRATEGIC LOCATION

39

GUJARAT INDIAS ECONOMIC POWERHOUSE

40

GUJARAT ROBUST INFRASTRUCTURE

41

GUJARAT STRONG URBAN, SOCIAL AND EDUCATIONAL INFRASTRUCTURE

42

GUJARAT LAND OF INNOVATIVE HUMAN CAPITAL

43

GUJARAT NEW PARADIGM FOR INDUSTRIAL GROWTH

The current phase involving Integrated development of large areas like SIRs,
PCPIR and DMIC is poised to transform the industrial scenario in the state

Level of Integration

Integrated large area

developments

202 Industrial
Estates

83 product
clusters
Phase I

Phase II

SEZs
Multi product
Chemical
Textile
Pharma
IT / ITeS
Electronics
Engineering
Biotech
Gems &
Jewellery

Special Investment Regions

(>100 sq. km.) and Industrial Areas
(50-100 sq. km.)

Phase III

Phase IV

Delhi Mumbai Industrial Corridor

GIDC Industrial Estates
Petroleum, Chemicals and
Petrochemicals Investment Region
Knowledge corridor
Logistics parks
Theme towns

Phase of industrial development

44

GUJARAT - PROACTIVE GOVERNANCE

Source: Socio-Economic Review Gujarat, 2011-12, Department of Economic affairs, March 2009

45

OPPORTUNITIES TO INVEST IN GUJARAT

46

DOING BUSINESS IN GUJARAT

5
47

OVERALL FRAMEWORK FOR DOING BUSINESS

48

TAX FRAMEWORK

49

EXCHANGE CONTROL REGIME

50

FRAMEWORK FOR SETTING UP INDUSTRY IN GUJARAT

51

KEY GOVERNMENT AGENCIES

6
52

INDUSTRIAL PROMOTION FACILITATORS

53

KEY CONTACT PERSONS

Department of Agriculture and

Co-operation, Government of Gujarat
Shri R. K. Tripathy
Principal Secretary ,
Department of Agriculture & Co-operation
Block No. 5, First floor,
New Sachivalaya,
Gandhinagar, Gujarat
PHONE : +91-79-23250803

54

Gujarat Agro Industries Corporation Ltd.

Shri. N.K. Singh, IFS,
Managing Director, GAIC
Khet - Udyog Bhavan,
Opp. Old High Court,
Navrangpura,
Ahmedabad - 380 014.
PHONE : +91-79-2754 4741/42/43, +91-79-2754 0254
FAX : +91-79-2754 2518

National Partner

Knowledge Partner

Relationship Partner

Exhibition Partner

Airline Partners

Head Office: Block No. 18, 2nd Floor, Udyog Bhavan, GH-4, Sector 11, Gandhinagar 382 010 Gujarat, INDIA
Phone: +91-79-23250492/93 Fax: +91-79-23250490
www.indextb.com, www.ic.gujarat.gov.in E-mail: indextb@indextb.com
Regional Office: A-6, State Emporia Building, Baba Kharak Singh Marg, New Delhi 110 001, INDIA
Telefax: 011-23747002, 23360049 E-mail: indextbnd@indextb.com

For more details and online registration, log on to www.vibrantgujarat.com