Finance minister Pranab Mukherjee has brought cheer to companies wanting to set up cold chains, or refrigerated warehouses, by according infrastructure status to post-harvest storage, making it easy for the sector to secure much-needed foreign investment.
The budget for 2011-12 also slashed basic customs duty on specified agricultural machinery, including all cold storage equipment, from 5% to 2.5% and on micro irrigation equipment from 7.5% to 5%.
Further, capital investment in creation of modern storage capacity such as silos will be eligible for "viability gap" funding from the finance ministry, and cold storage conveyer belts and refrigeration panels have been exempted from excise, tandem moves that industry sees as a "complete package of relief."
According to NCMSL MD and CEO Sanjay Kaul, the move will provide a major fillip to the segment since so far infrastructure status was given only to port facilities handling agri produce.
Currently, post-harvest losses are estimated at Rs 50,000 crore and there is an estimaed 32mt shortage in storage capacity.
To stimulate the growth of the food processing sector and minimise wastages in a period marked by double-digit food inflation, a sound policy announcement that could trigger targeted foriegn investment was desperately needed. The move will give cold storage for highly perishable non-cereal foods such as fruit and vegetables a big push............Read More
Source Web Page: Economic Times