Orissa emerging as a key location for Food Processing Industrial Promotion & Investment Corporation of Orissa Limited (IPICOL)

Orissa GSDP growth on par with the GDP growth in India In 2008-09, Orissa’s NSDP grew by 12% approx. as compared to 15% of all the states combined in India Source: Economic Survey of Orissa 2009-10 In 2008-09, the service sector accounted for 55% of the gross state Domestic product for Orissa, followed By industry (25%) and agriculture (20%) Source: Economic Survey of India 2010-11 Orissa Overview

Orissa-Investments under implementation Investments under implementation is on a continuous rise Outstanding investments grew at a healthy rate of 25% in the last 4 years. Orissa is the second highest state in FY11(till Feb) to accumulate investments worth INR1.83 trillion in the state. 292 projects mostly in the field of steel, power and mining are under implementation till December 2010 The FDI from the state is on a rise with 65% of the FDI coming from the last three years. “Orissa has now achieved the Indian national average in terms of the time spent by management in dealing with regulations and government authorities” --United Nations Industrial Development Organization survey

Orissa-first among equals Adjudged as ‘3rd best place to do business in India’ as per World Bank Study(2009) Orissa was ‘2nd highest domestic investment destinations of 2009’ as perr per ASSOCHAM Investment Meter (AIM) Study on Corporate Investments. Adjudged as ‘best place to trade across border’ as per World Bank Study(2009) Orissa mopped up ‘2nd largest fresh investments in the country’ in FY11 till February, according to CMIE Orissa is ‘1st in terms of total envisaged investments in India’ as per states of states survey-2007 done by India today.

Favorable land utilization pattern of Orissa favors the growth of food processing industry High proportion of total cropped area (122 lakh hectares, 78%) in Orissa offers huge investment potential to the food processing and agro industry Source: Economic Survey of Orissa, 2010–11 Orissa possesses 10 agro-climatic zones and 8 major soil types It is the country’s leading producer of rice, pulses, vegetables, oilseeds, cotton, groundnut, coconut, jute, spices, potato and fruits The state contributes less than 2% to the country’s milk production and 3% of its egg production It has 4 fishing harbors and 60 fish landing centers The area sown more than once (ASMO) has been on a rise in the state Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011 Net area sown and forest area jointly account for more than 73% of total land in Orissa

Composition of Orissa’s economy vis a vis India’s economy (2009-10) Agriculture Composition of Orissa’s economy vis a vis India’s economy (2009-10) Orissa’s economy in comparison with India’s economy is more agricultural, less industrial and less service oriented The state’s agriculture sector offers employment and sustenance to more than 60% of total work-force Source: Economic Survey of Orissa, 2010–11 4,632 8,571 8,505 9,054 9,203 9,857 8,715 8,747 Food grains (cereals and pulses) production, with a share of more than 85%, continues to dominate in the total agricultural production Food grain production has been witnessing a secular increasing trend in production since 2002-03, reaching 7,551 thousand metric tonnes in 2009-10 Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011 Source: Economic Survey of Orissa, 2010–11

Production of different crops in Orissa Orissa reaps the benefits of higher cropping intensity Production of different crops in Orissa (in ‘000 MT) 2005-06 2006-07 2007-08 2008-09 2009-10 Cereals Rice 6,859 6,825 7,541 6,813 6,917 Maize 102 103 147 135 175 Ragi 40 43 47 41 37 Others 22 26 23 24 Total Cereals 7,023 6,993 7,761 7,012 7,153 Pulses Gram 25 34 Tur 98 106 113 119 112 Other 216 221 245 237 252 Total Pulses 337 351 384 381 398 Total Food grains 7,360 7,344 8,145 7,393 7,551 Source: Economic Survey of Orissa, 2010–11 Paddy accounts for nearly 79% of the total crop production. Cropping intensity for Orissa has grown over the years from 157% in 2005-06 to 163% in 2009-10 Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011 Source: Economic Survey of Orissa, 2010–11

Increasing facilitation for agriculture in Orissa CAGR: 7% Source: Economic Survey of Orissa, 2010–11 Source: Economic Survey of Orissa, 2010–11 Increasing total area under irrigation, enhanced usage of fertilizers and pesticides coupled with better financing augurs well for food processing industry in Orissa CAGR: 23.7% Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011 Source: Economic Survey of Orissa, 2010–11

Development of Mega Food Parks Scheme of GoI IDCO envisages to develop Food Parks under the Mega Food Park Scheme at Bhadrak (242 Acres) and Khurda (282 Acres) in Orissa 9

Food processing: key regions The Khurda region (comprising Khurda, Cuttack and Puri districts) is emerging as a food-processing hub as it possesses multiple resources such as egg, milk and vegetables Ganjam is a resource-rich district in terms of milk, egg, fishing, fruit and vegetables Other Fruit processing clusters Other vegetable processing clusters Other fishing centers Other egg producing districts

State level government initiatives to drive Orissa’s agriculture Agriculture Policy, 2008: State Government brought out a “New Agricultural Policy” to enhance productivity of major crops and for shifting the emphasis from “subsistence” agriculture to profitable commercial agriculture Agricultural Promotion and Investment Corporation Ltd (APICOL) was setup in 1995-96 for promoting commercial agri-enterprises, agro-based and food processing industries in the state Intensive Cotton Development Programme (ICDP) for promotion of cultivation through the means of organizing 7 training extension programmes, 133 farmers’ field schools, 50 awareness camps and 22 Front line demonstration Government has Farm mechanization programme that aims at promoting easy availability of the appropriate farm machines Orissa Agro Industries Corporation (OAIC) for marketing various agricultural inputs and farm machineries through network at district and sub-district levels Orissa Integrated Irrigated Agriculture & Water Management Investment Project (OIIAWMIP) for the optimal use of irrigation potential in the state Watershed mission to undertake soil and water conservation measures in areas with inadequate irrigation facilities Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011; “Orissa soon to come out with food processing policy,” Economic Times website, http://articles.economictimes.indiatimes.com/2010-03-05/news/28486515_1_agri-and-food-processing-food-grains-agro-industries, accessed 4 May 2011

Agro & Food Processing Sector: IPR 2007 Incentives Agro Processing sector is identified as one of the thrust sector in IPR 2007 with minimum capital investment of Rs. 25 crore & the direct employment generation for 100. The Fiscal Incentives for Agro processing are as follows: Sl. No. Incentive Thrust Sector 1 Stamp duty exemption 100% 2 VAT exemption NM 3 Entry Tax exemption 1.100% on P&M 2. RM- 5 yrs or 100% FCI (CtoC-cabinet) 4 CST 2% for 10 yrs or 100% FCI 5 Interest subsidy 5% on term loan for 5 yrs with limit of Rs 1 crore 6 Power: Electricity Duty exemption 100% Exemption for 5 years for contract demand upto 5 MW 7 Patents registration cost reimbursement same as (3) 8 Quality certification (ISO) charges reimbursement 9 Technical Know-how cost reimbursement 50% of the expenditure with limit of Rs 1 lakh–D Rs 5 lakh- M 10 Investment Subsidy

Players in Food Processing Industry of Orissa Agriculture Animal husbandry Marine processing Bhubaneswar Hatcheries Pvt Ltd. Kalinga Hatchery Pvt. Ltd Health Food Product (P) Ltd. Agarwal Spices & Food Processors (P) Ltd. Maa Durga Rice Processing and Exports Pvt Ltd Aanjaneya rice mill M/s Suryo Foods & Industries Ltd. M/S Bijaya Marine Products Konark Aquatics & Exports (P) Ltd. Sealand Fisheries (P) Ltd.

Leading brands present in the State… Orissa’s food processing industry as an emerging investment destination… Anmol Company will set up a Biscuit production food processing plant of 58,000 million ton production capacity at Khurdha with an investment of INR810 million NSL group has evinced interest for setting up a seed processing plant at Bonda in Baragarh district at an investment of INR400 million Agriculture Promotion and Investment Corporation of Orissa Limited (APICOL) has announced its plans to setup export-oriented integrated pack house of fruits and vegetables with collection centre at a cost of INR56.3 million in Bolangir district Shimpo Seafoods has announced that it is setting up a fish processing and canning unit with a capacity of 1,000 tpa in Bhubaneswar costing INR100 million (to be completed by Feb 2011) Leading brands present in the State… Sources: “Infrastructure development of Orissa,” Orissa Links website, http://www.orissalinks.com/orissagrowth/topics/industry-all/food-processing accessed 4 May 2011; “Food Processing and Canning,” FNB News website, http://www.fnbnews.com/article/print.asp?articleid=28924, accessed 5 May 2011; “APICOL to set up export-oriented facility,” The Hindu website, http://www.hindu.com/2011/03/13/stories/2011031352090300.htm, accessed 4 May 2011 “PRAN Group to set up food processing plants in India,” Zimbio, 25 March 2009, http://www.zimbio.com/India/articles/5437396/PRAN+Group+set+up+food+processing+plants+India, accessed 1 June 2011. “Taiwan keen to import Orissa seafood,” The Times of India, 22 March 2011, http://articles.timesofindia.indiatimes.com/2011-03-22/bhubaneswar/29174377_1_investment-wenchyi-ong-import, accessed 1 June 2011. Shimpo Seafoods

Government initiatives Outlook Inherent Resources Government initiatives Investments High proportion of cropped area in total land utilization 10 agro-climatic zones and 8 soil types High cropping intensity 4th largest vegetable producing state of India 3% and 4% contributor to the country’s floricultural and spices production respectively Long coastline Futuristic 2008 Agriculture policy: “subsistence” to profitable commercial agriculture Watershed mission and irrigation projects Livestock breeding farms, poultry hatcheries and fodder farms Fishery development policy, state reservoir fishery policy, Welfare schemes for fisherman, fishfed for marine industry Setting up of food parks in the Khurda region Increasing interest of both large national and foreign corporate, and several MSMEs for investment Britannia, Nestle, and Parle Agro - Approved NSL Group, Indo Nissin, PRAN Group - In process Evincing of interest by the Taiwan’s and Ghana’s Government for investment Plans of foreign players to enter Orissa’s food processing industry Sources: “Nestle to invest Rs 500 crore in food processing unit,” Business Standard, 14 September 2010, http://www.business-standard.com/india/news/nestle-to-invest-rs-500-crore-in-food-processing-unit/407979/, accessed 1 June 2011. “Orissa to woo major players in food processing sector,” Business Standard, 6 January 2010, http://www.business-standard.com/india/news/orissa-to-woo-major-players-in-food-processing-sector/381782/, accessed 1 June 2011. “Government allots 110 acres to 55 units for food processing park,” Business Standard, 3 August 2010, http://www.business-standard.com/india/news/government-allots-110-acres-to-55-units-for-food-processing-park/403314/, accessed 1 June 2011. “Britannia to invest Rs 45 crore in Orissa unit,” Business Standard, 6 September 2010, http://www.business-standard.net.in/india/news/britannia-to-invest-rs-45-crore-in-orissa-unit/407066/, accessed 1 June 2011. “NSL plans to invest Rs 2340 cr in Orissa,” Business Standard, 11 May 2010, http://www.business-standard.com/india/news/nsl-plans-to-invest-rs-2340-cr-in-orissa/394439/, accessed 1 June 2011. “PRAN Group to set up food processing plants in India,” Zimbio, 25 March 2009, http://www.zimbio.com/India/articles/5437396/PRAN+Group+set+up+food+processing+plants+India, accessed 1 June 2011. Presence of large resources, upcoming investments and encouraging government initiatives to help Orissa achieve its full potential in the food processing sector

Orissa provides marketing assistance to farmers to ensure returns for their produce Orissa offers state farmers with agricultural marketing support to enable them get remunerative returns for their crop produce. Agricultural marketing initiatives include: Markets and complexes ‘Krushak Bazaar’ - Established a Krushak Bazaar with an aim to train farmers, create primary rural markets, and launch awareness campaigns. ‘Terminal Market Complexes (TMCs)’ - Orissa government announced plans to set-up three Terminal Market Complexes in the State (one each near Cuttack, Sambalpur & Berhampur under the PPP mode) in order to provide a fair share of consumer price to the producer as well as ensure high quality and hygiene of the produce. The TMC would operate on a Hub-and-Spoke Format wherein the Terminal Market (the Hub) would be linked to a number of Collection Centres (the spokes). The TMCs would enable farmers get proper prices for their surplus paddy sold at market yards. TMCs would also offer sufficient facilities for cleaning and drying, grading, weighing and bagging, at all those market yards / sub-market yards/ temporary procurement centres engaged in paddy procurement. Market yards - Under Revised Long Term Action Plan (RLTAP) scheme for Koraput, Bolangir and Kalahandi (KBK) districts, market yards have been established to facilitate the selling and procurement of crop products, and ensure farmers can get a reasonable price for their produce. ‘Minimum Support Price (MSP)’ mechanism is implemented effectively across the state so as to ensure remunerative prices for the farm produce. ‘Agri-export Zones (AEZs)’ - to be established in PPP mode form agricultural and horticultural produce having export potential. Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011. “State Agriculture Policy - 2008,” Government of Orissa Agriculture Department, August 2008. “Evaluation study diversification of agricultural crops, value addition and marketing under RLTAP,” Planning & Coordination Department, Government of Orissa, May 2010

Orissa has several agencies and committees to support farmers market their produce Orissa has a conducive marketing infrastructure in place to ensure good sales of farm produce, as well as provide an incentive for farmers’ efforts. Marketing federation and committees ‘Orissa State Marketing Federation’ (OSMF) - Has the OSMF which functions as the apex organization with 51 regional cooperative marketing societies (RMCs) that undertake several marketing initiatives. Orissa also amended the RMC Act in order to involve the private sector (through contract farming, etc.) in promoting agricultural marketing. ‘Regulated Market Committees’ - Has committees in place to facilitate backward and forward market integration of agricultural produce. Regulated Market Committees work as facilitators between the farmers and procuring agencies. They provide both parties with facilities such as market yard, weigh bridge, meeting of farmer & agencies, cold storage of perishables. ‘Rural Producers’ Organizations’ - to be formed for specific commodities to enable them to have appropriate market linkages through Federations. Sources: “Government of Orissa- Economic Survey 2010-11,” Planning & Coordination Department, February 2011. “State Agriculture Policy - 2008,” Government of Orissa Agriculture Department, August 2008 “Regulated Market Committee,” Department of Co-operation, Government of Orissa, http://orissa.gov.in/co-operation/RMC.aspx?GL=14&PL=1, accessed 1 June 2011. Other initiatives ‘Other agencies’ - Orissa has several other organizations such as Orissa State Tribal Development Co-operative Corporation (TDCC), the Orissa State Oilseeds Growers’ Federation, 213 Large-sized Agricultural Multi-purpose Societies (LAMPS) to cater to needs to different stakeholders in agricultural marketing.

Thank You Industrial Promotion & Investment Corporation of Orissa Limited (IPICOL) IPICOL House, Janpath Bhubaneswar-751022 Orissa (India) Phone No: +91-0674-2542601/02/03 Fax: +91-0674-2543766 E-mail: info@teamorissa.org   If using the graphic on the title slide the same should be used on the thank you slide. If using a picture in the Input area of the Beam in the title slide, the same or different but related picture can be used on the thank you slide.