Food Processing Industry Ministry Seeks Extension of PMFME Scheme with Revised Guidelines

Extension of PMFME Scheme Proposed for Five More Years

The Food Processing Industries Ministry is set to move a proposal to extend the Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) scheme for five more years with revised guidelines. According to a senior official, the central scheme, launched in 2020 and currently extended till September 2026, has been successful in modernising micro enterprises, strengthening Self Help Groups (SHGs) and creating common infrastructure and incubation centres.

The key changes proposed in the revised guidelines include increasing the credit-linked capital subsidy beyond the existing upper limit of Rs 10 lakh per unit, providing preferential treatment for women entrepreneurs and enterprises in hilly regions, and a focus on branding and marketing. Currently, the scheme provides a subsidy of up to 35 per cent of the eligible project cost, capped at Rs 10 lakh per micro-enterprise, for individuals or groups setting up or upgrading food processing units.

Since its 2020 launch, 1.96 lakh micro enterprises have used the credit subsidy window for projects worth Rs 19,844 crore in total, with the government paying out Rs 5,844 crore in subsidies. Around 65,000 units have been modernised, with a 2-lakh-unit target expected to be met next month. Bihar leads in the number of beneficiaries, followed by Maharashtra, Uttar Pradesh, Tamil Nadu, and Madhya Pradesh. Processing of cereals, oil and oilseeds, and fruits and vegetables accounts for the bulk of activity.

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Women-led enterprises make up approximately 40 per cent of all beneficiaries. Under the seed capital component, 4 lakh women have received support totalling Rs 380 crore for working capital and small tools. Of these, 15,000 have graduated to the status of micro enterprises and applied for credit-linked capital subsidies.

On the infrastructure side, the Ministry has approved 80 common infrastructure and incubation centres, of which 31 are currently operational. Another 20-25 are expected to become functional within two to three months, with the remainder likely by year-end. Most centres are located within agricultural universities and ICAR institutes.

The scheme targets individual micro-enterprises as well as collectives such as Farmer Producer Organisations (FPOs), SHGs and cooperatives operating in the unorganised food processing segment.

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