Proposed 10-year tax holiday for food processing units

India’s ministry of food processing industries has outlined proposals that include a 10-year tax holiday for food processing units to include in the country’s coming Budget.

Media reports also said other parts of the proposal include a special economic zone status for food parks and infrastructure status for the industry.

The ministry believes the measures will boost foreign direct investment inflow into the country and availability of cheaper credit in the sector.

India reportedly only processes 5% of its total agricultural produce, compared to around 80% by the US and Malaysia.

However the Indian Government expects to process 20% of its agricultural produce by 2015, for which it has planned to build massive capacity.

The ministry is also pitching for SEZ status for the mega food parks being developed in different parts of the country to ensure these parks will be exempt from paying local taxes.

The food processing ministry has also sought a higher Budget allocation.

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