In a bid to attract entrepreneurs to set up mega food parks and sea food parks, the Odisha government's Food Processing Policy-2013 promises capital subsidy up to 20 per cent of the project cost with cap of Rs 15 crore to the Special Purpose Vehicles (SPVs) formed for the purpose, according to a report by Business Standard.
"The subsidy can also be in the form of equity participation from the government," read the policy. For setting up of industrial units in the parks, the policy allows 25 per cent investment subsidy of the project cost (excluding land cost) with a cap of Rs two crore.
For women and SC&ST entrepreneurs, the subsidy will be 33 per cent of the project cost maximum up to Rs three crore.
This will also be applicable for the units promoted in the KBK districts.
"The Odisha government has taken an initiative to bring out a food processing policy aiming at value addition and waste reduction of the farm produce thereby increasing the income of farmers, maximising direct and indirect employment generation opportunities, increasing the flow of investment across the supply chain from farm to market," said Damodar Rout, Minister for Micro, Small and Medium Enterprise (MSME).
MSME department is the nodal agency for the policy. Only 0.7 per cent of the total produce in Odisha is processed currently. The new policy aims to increase this to 10 percent by 2017 and 25 per cent by 2025.
The industrial units in the mega food parks and sea food parks will be eligible for reimbursement of 100 per cent VAT (Value Added Tax) paid for a period of ten years limited to 200 per cent of fixed capital investment.
The policy ensures five per cent per annum back ended interest subsidy on working capital loan for first five years from commencement of operations of the units subject to a limit of Rs five lakh per year for five years.
This policy is in conjunction with Industrial Policy Resolution (IPR) 2007 and MSME Development Policy, 2009 and emphasises on development of supply chain and infrastructure opportunities in rural areas and development of food parks providing various fiscal and non-fiscal incentives, Rout added.