Investment Policies in Food Processing 

• Food Processing has been declared a priority sector. New foreign trade policy places renewed emphasis on agro-based industries.
   
• No industrial license is required for food and agro processing industries except for alcoholic beverages and items reserved for small scale sector, which are: Pickles and Chutneys, Bread, Pastry, Hard boiled sugar candy, Rapeseed Oil, Mustard Oil, Sesame Oil, Groundnut Oil, Sweetened Cashewnut products, Ground and processed spices other than spice oil and Oleoresin spices, Tapioca sago and flour.
  
• 100% Foreign Direct Investment (FDI) is allowed except in alcoholic beverages and items reserved for Small Scale Industries (SSI). Foreign equity of up to 25% is allowed even in SSI  reserved    items.  For equity beyond 25%, export obligation of 50% would be applicable.
   
• Exclusive Agri Export Zones set up for end to end development for export of specific products from geographically contiguous areas.
   
• Food Parks set up to enable food and beverage units to use capital intensive facilities, such as cold storage, warehouse, quality control labs, effluent treatment plant etc.
   
• Agro based units established in Special Economic Zones and 100% Export Oriented Units (EOU) are allowed (a) sales up to 50% in domestic tariff area and (b) import of capital goods and raw materials at zero duty.
   
• Excise Duty on processed fruits and vegetables and dairy is zero, on processed meat and poultry is 8%.
   
• Income tax rebate is allowed for 100% profits for first 5 years and then 25% for the next 5 years in case of new food processing industry in fruits and vegetables.
   
• Future commodity trading is allowed in agro produces.

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