India’s food processing sector is poised for unprecedented expansion, with its market size projected to grow from $307 billion in 2023 to $700 billion by 2030, according to a report by the PHD Chamber of Commerce and Industry (PHDCCI). This growth presents a significant opportunity for MSMEs engaged in food processing, supply chain, and value-added agriculture.
Expanding Market: A Boon for MSMEs
The food processing industry is expected to continue its rapid expansion, reaching $1.1 trillion by 2035 and $2.15 trillion by 2047. This surge is fueled by rising consumer demand for packaged and processed foods, improved supply chain infrastructure, and government initiatives aimed at boosting agri-businesses and MSMEs.
MSMEs play a pivotal role in India’s food processing ecosystem, contributing to local manufacturing, value-added production, and employment generation. As demand for ready-to-eat, organic, and health-conscious food products rises, small and medium enterprises are uniquely positioned to capitalize on this evolving consumer trend.
Government Support and Policy Initiatives
The Indian government has prioritized food processing as a key sector, offering Production Linked Incentives (PLI), tax rebates, and easier access to credit for MSMEs. Additionally, programs such as Mega Food Parks, Pradhan Mantri Kisan SAMPADA Yojana, and Startup India are encouraging small businesses to modernize operations, improve efficiency, and integrate with global markets.
According to PHDCCI President Hemant Jain, India’s agriculture and allied sector has maintained an average growth rate of 3.9% from 2013-14 to 2023-24, highlighting its resilience even during economic slowdowns and global disruptions. The sector’s projected growth rate of 3.8% for 2024-25 further reinforces its potential as a driver of economic expansion.
MSMEs and Export Potential in Food Processing
India’s agriculture exports have shown consistent growth, increasing from $39 billion in 2013-14 to over $52 billion in 2022-23. This trend highlights expanding global demand for Indian processed foods, opening doors for MSMEs to export value-added products such as organic foods, frozen meals, and specialty ingredients.
To maximize export potential, MSMEs need to leverage quality certifications, embrace food safety standards, and adopt digital platforms for global market access. The rise of e-commerce and direct-to-consumer models also presents new business opportunities for small food processors to reach international buyers.
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Seizing Growth Opportunities in Food Processing
For MSMEs looking to scale operations, the food processing industry offers long-term growth prospects and expanding domestic and international markets. By investing in technology, improving supply chain efficiencies, and adapting to changing consumer preferences, small businesses can strengthen their position in India’s booming food industry.
With strong policy support, rising investments, and increasing consumer demand, the food processing sector will continue to be a vital economic engine, presenting MSMEs with unparalleled opportunities for expansion, job creation, and innovation in the years to come.