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One District One Product Strategy Boosts Kerala’s Micro Enterprises in Food Sector

In Business
July 22, 2023

Kerala’s rich and diverse micro enterprises in the food processing sector have received a boost by adopting the One District One Product (ODOP) approach to promote a wide range of ventures by facilitating credit with a subsidy component for scaling up production and marketing under the Pradhan Mantri Formalization of Micro Food Processing Enterprises (PM FME) Scheme.

As per the scheme, micro entrepreneurs starting ventures in food sector can avail 35 percent of the available project cost as subsidy, with a maximum of Rs 10 lakh. So far, subsidy has been sanctioned to 1,233 enterprises, and of them, a total of 581 entrepreneurs have received a subsidy totaling Rs 15.09 crore in the individual category in the state.

Moreover, PM FME scheme envisages a seed capital assistance of Rs 40,000 for working capital and purchase of small tools for each member of Self-Help Groups (SHGs) engaged in food processing activities through Kudumbashree Mission. The component under PM FME for providing seed capital to SHGs is implemented with the support of National Rural Livelihood Mission (NRLM) and National Urban Livelihoods Mission (NULM) and its network of the State Rural Livelihood Mission (SRLM) and State Urban Livelihood Mission (SULM).

The scheme was launched by the Union Ministry of Food Processing Industries (MoFPI) in June 2020 under the ‘Aatmanirbhar Bharat Abhiyan’ with the aim of enhancing the competitiveness of existing individual micro enterprises in the unorganised segment of the food processing industry and promoting formalisation of the sector. The scheme is to be implemented over a period of five years from 2020-21with a total outlay of Rs 10,000 crore. It focuses on supporting groups engaged in agri-food processing such as Farmer Producer Organisations (FPOs), SHGs, Cooperative Societies and Producers Cooperatives along their entire value chain.

The Department of Industries and Commerce (DIC), Government of Kerala, the State Nodal Department for implementing the scheme, has provided substantial assistance to micro enterprises in the food processing sector across the state by facilitating credit with subsidies, besides seed funds to SHG members of micro food processing units promoted by Kudumbashree. Kerala Bureau of Industrial Promotion (KBIP) is the State Nodal Agency for implementing the scheme.

Based on the ODOP approach envisaged as per this scheme, enterprises were encouraged to produce and market specific products based on the ODOPs identified for each district. The Ministry approved ODOP products identified for 14 districts of Kerala are: Tapioca-based items for Thiruvananthapuram, tapioca and tuber crop-based products for Kollam, jackfruit-based items for Pathanamthitta and Kasaragod, rice and rice-based products for Alappuzha and Thrissur, coconut-based items for Kottayam, Malappuram, Kozhikode and Kannur, spice-based items for Idukki, pineapple-based products for Ernakulam, milk-based products for Wayanad and banana-based items for Palakkad.

The District Industries Centres (DICs) which act as the District Nodal Point, identified these ODOPs and encourage the value-addition of micro food processing units to focus on the specific area for tapping the huge market within and outside the state.

In all, 135 District Resource Persons (DRPs) have been engaged across districts to extend support to the beneficiaries. They will not only handhold the units for availing credit, but also provide all required assistance including formalisation of the units. Also, an Agri Business Incubator has already been set up by the Kerala Agricultural University (KAU) at Mannuthy, Thrissur, for the processing of rice, fruits & vegetables, and spices.