$100 billion export target set for India’s food, agriculture sectors

India has allowed 100 per cent foreign investment in the food and beverage sector, full foreign ownership, and complete foreign management of such foreign-owned enterprises, the Minister of Commerce and Industry, Piyush Goyal, has announced.

“The government will sanction speedy and easy work permits for those who want to work in such enterprises or set up food and beverage businesses in India,” Goyal said in a landmark announcement.

The Minister set a target of $100 billion in combined exports from India in the food and beverage, agriculture and marine products industries in the next five years.

Emphasising the promotion of sustainability in the food industry, Goyal said the Ministry of Commerce and Industry is prioritising on making farming processes sustainable. It is also promoting organic farming and organic food products.

“The government has eased the certification processes for organic foods while maintaining their sanctity and traceability to ensure that no irregularities creep into the system,” he added.

India exported $50 billion worth of food, beverage, agricultural and marine products last year.

Goyal complimented the Agricultural and Processed Food Products Export Development Authority and the Marine Products Export Development Authority for this export drive.

Meanwhile India has cut taxes on foreign companies to attract more investments from abroad.

“The rules and regulations for both Foreign Direct Investment (FDI) in India and overseas investment by Indians will be simplified to facilitate foreign investments, nudge prioritisation, and promote opportunities for using the Indian Rupee as a currency for overseas investments,” India’s Finance Minister, Nirmala Sitharaman said in Parliament.

Presenting the government’s annual budget, Sitharaman announced a five-percent cut in corporate tax for foreign companies. The new rate will be 35 per cent, with the aim of incentivising foreign entities with investments in India.

“We are trying to bring in ease of doing business in India,” she assured potential investors abroad. “In every sector where there was only 26 per cent foreign direct investment allowed, we raised it to 49 per cent and then wherever possible, we have raised it to 74 per cent.”

She said there has been a consistent and continuing effort to relax the government’s policies to attract foreign direct investment (FDI). “In that process, we are willing to do further simplification,” she said.

Referring to the decentralisation of investment norms, Sitharaman said states will be incentivised to implement their business reforms and action plans to make federal investments more attractive.

India is offering global investment opportunities worth $100 billion in the energy sector to be met by 2030, the Minister of Petroleum and Natural Gas, Hardeep Singh Puri, has said.

Puri said the government aims to increase the acreage under oil and gas exploration to one million sq. km. by 2030.

“Only 10 per cent of India’s sedimentary basin area is under exploration today. After the award of blocks under the forthcoming Open Acreage Licensing Policy (OALP) rounds, this will increase to 16 per cent by the end of this year,” the Minister said.

He was speaking after the conclusion of “Urja Varta 2024,” a two-day conclave organised by the Directorate General of Hydrocarbons (DGH).

The conclave brought together 400 industry experts, service providers, consultants, and academia members from both traditional and non-traditional energy sectors all over the world.

Puri announced the formation of a Joint Working Group comprising representatives from private sector exploration and production enterprises, the national oil companies, the Ministry of Petroleum and Natural Gas, and the DGH to address industry concerns and improve the ease of doing business in the sector.

“We have already simplified and reduced 37 approval processes into 18. Nine of these processes are now eligible for self-certification. However, we recognize the need to push these reforms further,” the Minister added.

He said India had already reduced the “no-go” areas in India’s exclusive economic zone (EEZ) by almost 99 per cent.

Meanwhile India notified amendments to its foreign direct investment policy in the space sector to allow 100 per cent inflow of external funds in three categories of manufacturing.

The three categories are components and systems or sub-systems for satellites, ground segment and user segment.

Without any prior government approval, 100 per cent foreign direct investment in these business activities will henceforth be allowed.

WAM