Understanding the Agro Processing Clusters Scheme (PMKSY)
Are you interested in India’s food processing sector or the agricultural industry? The Government of India, through the Ministry of Food Processing Industries (MoFPI), is implementing a significant scheme called the “Scheme for Creation of Infrastructure for Agro Processing Clusters (APC)” under the Pradhan Mantri Kisan Sampada Yojana (PMKSY). These guidelines were recently updated on April 25, 2025, based on experiences from previous versions.
Last Date: 14th July 2025
What is this Scheme?
- It’s a Central Sector Scheme designed to create modern infrastructure for food processing units.
- The core idea is to establish Agro Processing Clusters (APCs), which are areas where food processing units are set up together.
Why is this Scheme Important? (Objectives)
- To develop modern infrastructure for food processing, moving it closer to farming areas
- To help reduce post-harvest losses (like spoiled fruits and vegetables) and add value to agricultural produce.
- To increase farmers’ income and create local employment.
- It aims to provide facilities like cold storage, warehouses, and packaging, which are currently lacking in the country and hinder the growth of the food processing sector.
What Kind of Infrastructure is Supported? (Components)
The scheme supports two main types of infrastructure within the cluster :
- Basic Enabling Infrastructure: This includes essential facilities like roads, drainage, water supply, power backup, effluent treatment plants, parking, weigh bridges, and security rooms. These are crucial for the overall development of the cluster.
- Core Infrastructure: This refers to facilities directly used for food processing, such as food testing laboratories, grading units, sorting and packing facilities, steam generation boilers, dry warehouses, cold storage, pre-cooling chambers, ripening chambers, IQF (Individual Quick Freezing) units, specialized packaging, forklifts, and other common processing units.
- Important Note: Not everything is covered for grants. Items like approach roads, cost of land, canteens, quarters for workers, fuel, and transport vehicles are not eligible for grant calculation.
Who Can Benefit? (Eligible Entities)
- Agro Processing Cluster Projects can be set up by various entities, including Central & State PSUs, Joint Ventures, NGOs, Cooperatives, Self Help Groups (SHGs), Farmer Producer Organizations (FPOs), Farmer Producer Companies (FPCs), Public & Private Sector Companies, Limited Liability Partnerships (LLPs), and Proprietorship Firms.
- A key requirement is that the net worth of the applicant should be at least 1.5 times the grants-in-aid sought.
- SC/ST category applicants and those from Difficult Areas, FPOs, and SHGs have specific considerations regarding net worth.
How Much Financial Help Can You Get? (Grants-in-Aid)
- The scheme provides grants-in-aid as financial assistance.
- For projects in General Areas, the grant can be up to 35% of the eligible project cost.
- For projects in Difficult Areas, SC/ST, FPOs, and SHGs, the grant can be up to 50% of the eligible project cost, with a maximum of ₹10 crore.
- The total project cost must include a minimum aggregate investment of ₹25 crore from at least 5 food processing units in the cluster.
Where Can Clusters Be Set Up?
- Clusters can be set up in areas identified by various government ministries and departments, such as the Department of Agriculture, Co-operation and Farmers Welfare (DAC&FW), Ministry of Development of Horticulture (MIDH), APEDA, and the Department of Commerce.
- They can also be set up in clusters notified by State Governments and/or entities on a Public-Private Partnership (PPP) mode.
- Lists of identified clusters for different products (e.g., Apple, Mango, Pineapple, Poultry, Vegetables, Fish) are provided in the source documents.
Application Process
- Applications must be submitted online via the SAMPADA Portal of the Ministry.
- You’ll need to submit a Detailed Project Report (DPR), which outlines the project details, financial projections, and technical feasibility.
- Other important documents include Chartered Accountant certificates (for net worth and project cost), bank appraisal notes, land documents, and various consents/approvals.
- The Ministry will review proposals and make decisions regarding grants.
Project Timelines
- Project completion is generally expected within 24 months for General Areas and 30 months for Difficult Areas from the date of the approval letter.
- Grants are released in three (3) equal instalments based on project progress and compliance.
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