**Executive Summary**
This document contains the answer to Unstarred Question No. 971 in Lok Sabha, concerning food processing-based schemes for farmers, answered on February 5th, 2026. It outlines that no budget announcement has been made for food processing schemes during 2025-26. It also specifies financial assistance provided to Farmer Producer Organizations (FPOs), and clarifies provisions related to farmers receiving income above the minimum support price (MSP).
**Key Points / Main Content**
* **Budget Allocation:**
* No budget announcement has been made for food processing schemes during 2025-26.
* **Ministry Initiatives:**
* The Ministry of Food Processing Industries (MoFPI) promotes the food processing sector through:
* Pradhan Mantri Kisan SAMPADA Yojana (PMKSY)
* Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)
* PM Formalization of Micro Food Processing Enterprises (PMFME)
* These schemes are demand-driven and implemented across the country, not region or state-specific.
* **Financial Assistance to FPOs and Cooperatives:**
* Under PMKSY, Farmer Producer Organizations (FPOs) can receive grants up to 50% of eligible project costs, compared to 35% for proposals from general areas.
* Cooperatives are eligible for grants at 35% of eligible project cost under schemes of MoFPI.
* **Minimum Support Price (MSP) Provisions:**
* Government Agencies procure foodgrain stocks from farmers at Purchase centers at Minimum Support Price (MSP) if the stocks conform to Government of India (GoI) specifications.
* Farmers are free to sell their produce in the open market if they can obtain better prices than MSP.
**Impact Analysis**
**Farmers:**
* **Impact:** Farmers benefit from schemes incentivizing food processing. FPOs receive enhanced grants under PMKSY, which may improve their income and infrastructure. Farmers retain the autonomy to sell produce where they receive the best price.
* **Action Required:** Farmers, especially FPOs and cooperatives, should explore and apply for grants under PMKSY and other relevant schemes to enhance food processing capabilities. They should monitor market prices to decide where to sell their produce for maximum profit.
**Farmer Producer Organizations (FPOs) and Cooperative Societies:**
* **Impact:** FPOs and cooperatives can access financial assistance to support food processing projects. The enhanced grant under PMKSY provides a greater incentive.
* **Action Required:** FPOs and cooperatives should assess their eligibility and apply for grants under PMKSY and other MoFPI schemes to upgrade facilities and increase processing capacity.
**Ministry of Food Processing Industries (MoFPI):**
* **Impact:** The Ministry continues to implement existing schemes (PMKSY, PLISFPI, PMFME) to support the food processing sector, but there will be no new schemes for 2025-26.
* **Action Required:** MoFPI should continue to monitor and promote the existing schemes, assess their effectiveness, and possibly plan for new initiatives in future budgets.
Key Entities Referenced
Pradhan Mantri Kisan SAMPADA Yojana (PMKSY): A Central Sector Scheme incentivizing the setting up of the food processing sector.
Production Linked Incentive Scheme for Food Processing Industry (PLISFPI): A Central Sector Scheme incentivizing the setting up of the food processing sector.
PM Formalization of Micro Food Processing Enterprises (PMFME): A Centrally sponsored scheme for the formalization of micro food processing enterprises.
Minimum Support Price (MSP): Government agencies procure foodgrains at MSP.
Ministry of Food Processing Industries: The ministry responsible for food processing schemes.
GOVERNMENT OF INDIA
MINISTRY OF FOOD PROCESSING INDUSTRIES
LOK SABHA
UNSTARRED QUESTION NO. 971
ANSWERED ON 05TH FEBRUARY, 2026
FOOD PROCESSING BASED SCHEMES FOR FARMERS
971. SHRI ASHOK KUMAR RAWAT:
Will the Minister of FOOD PROCESSING INDUSTRIES be pleased to state:
(a) the details of proposed food processing-based schemes of Budget 2025-26 to increase
farmers' income;
(b) whether any special financial assistance is being provided to Farmer Producer
Organisations (FPOs) and cooperative societies and if so, the details thereof; and
(c) whether any provisions have been made to ensure that farmers receive income above
the minimum support price and if so, the details thereof?
ANSWER
THE MINISTER OF STATE FOR FOOD PROCESSING INDUSTRIES
(SHRI RAVNEET SINGH)
(a): No budget announcement has been made for food processing schemes during 2025-26.
(b): The Ministry of Food Processing Industries (MoFPI) incentivizes setting up of food
processing sector through its two Central Sector Scheme viz. Pradhan Mantri Kisan
SAMPADA Yojana (PMKSY), Production Linked Incentive Scheme for Food Processing
Industry (PLISFPI) and a Centrally sponsored PM Formalization of Micro Food Processing
Enterprises (PMFME). These schemes are not region or state specific but demand driven and
being implemented across the country.
Under PMKSY, quantum of grant is provided at enhanced level of 50% of eligible
project cost, in comparison to 35% for proposals from general areas (Subject to the maximum
ceiling under respective sub-schemes) to Farmer Producer Organizations (FPOs). Cooperatives
are eligible entities for availing grants @35% of eligible project cost under schemes of MoFPI.
(c): As per the Government’s policy of procurement of foodgrains, stocks conforming to
the Government of India (GoI) specifications which are offered by the farmers at Purchase
centers are procured by the Government Agencies at Minimum Support Price (MSP). However,
if the farmers get prices better than MSP in open market, they are free to sell their produce.
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