Creation of Backward & Forward Linkages
Scheme for Creation of Backward and Forward Linkages
CREATION OF BACKWARD & FORWARD LINKAGES - Introduction
The revised guidelines pertain to the Scheme for the Creation of Backward and Forward Linkages, launched by the Ministry of Food Processing Industries. This scheme addresses the need for enhanced capacity utilization of food processing units through the establishment of robust supply chains, ensuring a regular supply of raw materials and efficient market linkages.
Objectives
The objective of the scheme is to enhance the processed food industry’s efficiency by creating effective and seamless backward and forward integrations. This integration helps in plugging supply chain gaps, improving raw material availability, and ensuring better market linkages, thus securing remunerative prices for produce and processed goods.
Quantum of Assistance
Financial assistance under the scheme is substantial, with grants covering 35% of the eligible project cost in general areas and up to 50% in North-Eastern and Himalayan states, Islands, and ITDP areas, with a cap of 5 crore per project. This support aims to incentivize the creation of necessary infrastructure for comprehensive supply chain development.
Eligible Activities
The scheme supports a wide range of activities –
Backward Linkage: This includes the setup of integrated pack-houses, milk chilling centers, pre-cooling units, reefer boats, and machinery for minimal processing.
Forward Linkage: This involves the establishment of retail chains for perishable food products and distribution centers.
Transport: Provision for refrigerated and insulated transport to maintain the integrity of perishable goods from farms to retail outlets.
Implementation Period
The implementation schedule is strictly defined, with projects needing to be completed within 18 months for general areas and 20 months for special areas like the North-Eastern States and Himalayan regions. This timeframe ensures timely realization of project benefits.
Eligibility Criteria
Eligible entities include promoters of food processing units, entrepreneurs, co-operatives, Farmer Producer Organizations (FPOs), and others linked to the food processing supply chain. This broad eligibility is designed to encourage participation from various stakeholders in the food processing industry.
Application and Documentation
Applicants must submit detailed project reports and various certifications as part of the application process. This rigorous documentation requirement ensures that only feasible and well-planned projects receive funding.
Procedure for Disbursement and Appeals
The grant is disbursed in three installments. The first installment is 25% of the approved grant, released upon verification that 25% of the promoter’s contribution and the term loan have been spent on the eligible project cost. The second installment, 40%, is released after verifying the use of the first installment and ensuring that 65% of the promoter’s contribution and term loan have been used. The final 35% is released after verifying the completion of the project and the start of commercial operations. This staged disbursement ensures the proper use of funds and compliance with project goals. An appeals process is in place for grievances related to funding decisions
Conclusion
The revised guidelines for the Scheme for Creation of Backward and Forward Linkages represent a structured approach to enhancing the capacity utilization of the food processing industry. By addressing supply chain inefficiencies, the scheme aims to improve the operational efficiency and market connectivity of food processing units across India, thereby boosting their productivity and profitability.
Rapid Consulting’s Role in Facilitating the Process
Rapid Consulting could provide essential services to help organizations establish infrastructure for backward and forward linkages in the food processing industry. They could guide stakeholders including government departments, PSUs, NGOs, cooperatives, SHGs, private companies, and FPOs, through the eligibility requirements of the scheme. Their services include assisting with application preparation and submission, and ensuring compliance with the scheme’s guidelines. Their support would be aimed at maximizing financial incentives and ensuring efficient project implementation.
Impact of the Scheme on Haryana’s Industrial Growth
The scheme is designed to enhance the food processing sector by developing infrastructures such as integrated pack-houses, cold storages, and retail outlets, as well as connecting these through refrigerated transport. By creating these facilities, the scheme encourages entrepreneurs to establish food processing units that integrate both backward and forward linkages, thus minimizing loss of perishables, adding value to agricultural products, increasing farmer incomes, and creating employment opportunities.
Future Prospects and Enhancements
Future enhancements could include broadening the types and numbers of facilities supported, increasing the financial support limits, or expanding eligibility criteria to include more kinds of food processing initiatives. Further integration with other agricultural and industrial development programs might also provide more comprehensive support and accelerate growth in the sector.
FAQs ?
What is the Scheme for Creation of Backward and Forward Linkages?
This scheme supports the establishment of infrastructures that integrate both the supply of raw materials and the marketing of finished products within the food processing industry.
Who is eligible for this scheme?
Eligible entities include government departments, PSUs, cooperatives, private sector companies, NGOs, SHGs, FPOs, and others involved in the food processing industry.
How does an entity apply for this scheme?
Applications must be submitted online through the designated portal, with detailed project reports and financial statements demonstrating compliance with the scheme’s eligibility criteria.
What are the financial benefits of participating in this scheme?
Projects can receive grants covering up to 35% to 50% of the eligible project cost, depending on the location and nature of the applicant entities, with a maximum grant of up to Rs. 5 crore.
What happens if incorrect information is provided in the application?
Incorrect or fraudulent information may lead to the cancellation of financial support, and repayment of the grants with interest may be required.
How does Rapid Consulting assist in this process?
Rapid Consulting ensures that applicants navigate the scheme’s requirements effectively, from application through final approval and implementation, helping to avoid common pitfalls and efficiently manage documentation and compliance requirements.
Target Sectors in India
The initiative by the Ministry of Food Processing Industries to enhance the food processing units includes creating backward and forward linkages aimed at increasing capacity utilization by ensuring a steady supply of raw materials. This comprehensive scheme also involves setting up primary processing centers and modern retail outlets, which are connected through insulated and refrigerated transport.
Eligibility for Existing Businesses and New Ventures
Entities eligible for this scheme include promoters of food processing units, entrepreneurs, and producer groups like Co-operatives and Farmer Producer Organizations. The eligibility criteria also extend to retailers linked to farm-level infrastructure or processors, emphasizing the integration of various stakeholders in the food processing value chain.
Integration with Other Subsidies and Incentives
The scheme offers financial assistance in the form of capital investment subsidies, with enhanced subsidies available for projects in special areas such as the Northeast and Himalayan states. These incentives are designed to encourage investments in modern food processing technologies and infrastructure, thereby boosting overall efficiency and productivity.
Application Process: The application process requires a detailed project report and a credit-linked project that meets the technical standards set by the ministry. Applicants must demonstrate compliance with these standards through a technical appraisal to qualify for financial assistance, reflecting the program’s emphasis on maintaining high-quality infrastructure development.
Geographical Preferences in India: Priority is given to developing infrastructure in regions where there is a high production of perishable horticultural products. This strategic focus is intended to reduce post-harvest losses and improve the quality of the produce, which is critical for maintaining the viability and sustainability of agricultural operations in these areas.
Why Choose Rapid Consulting ?
Specialized Expertise: Our team at Rapid Consulting boasts in-depth knowledge of subsidy schemes, ensuring you get the most out of your investment.
End-to-End Assistance: From initial assessment to final application, we manage the entire process, making it seamless and hassle-free for your business.
Maximized Benefits: We ensure that you fully leverage the financial incentives available, boosting your company’s growth and profitability.
Our comprehensive service includes
Consultation and Assessment: We begin by understanding the specific requirements and objectives of our clients. Through comprehensive consultations, we assess eligibility criteria and determine the feasibility of the subsidy application.
Documentation Preparation: Our team assists in preparing all necessary documentation required for the subsidy application. This includes gathering financial records, project details, investment plans, and any other relevant information needed for submission.
Application Submission: We manage the entire application process, ensuring that all documents are submitted accurately and on time. Our experts liaise with relevant government authorities and agencies to streamline the submission process.
Negotiation and Follow-up: In case of any queries or requests for additional information from the authorities, we handle negotiations on behalf of our clients. We ensure prompt responses and provide any further documentation required.
Subsidy Disbursement: Once the application is approved, we facilitate the disbursement of the subsidy amount to our clients. We ensure that all procedural formalities are completed smoothly for the timely release of funds.
Post-Subsidy Support: Our services extend beyond subsidy acquisition. We provide ongoing support to our clients, assisting with compliance requirements, reporting obligations, and any other post-subsidy concerns. With Rapid Consulting, clients can rely on our expertise and experience to navigate the complexities of the Cold Chain Scheme under the Sampada Yojna. We strive to maximize benefits and facilitate the growth and development of businesses in the cold chain sector.
How to Reach Us ?
Website: Visit our official website for detailed information, and service offerings, and to schedule an online consultation.
Direct Contact: Call us at +91-9467248028 / 9416506136 or email info@rapidconsulting.in to discuss your needs directly with our experts.
Office Visit: Our offices are open for in-person consultations at 134, Rapid Consulting, First floor Below Paysam Restaurant, Near Samsung Care. Lajpat Nagar, Rajgarh Road Hisar, Haryana-125001.
Here, you can meet with our consultants who can provide personalized guidance tailored to your business’s specific circumstances. Engage with Rapid Consulting today to leverage their expertise in enhancing your business’s financial and operational performance through the Collateral Free Credit Guarantee Scheme and other beneficial state initiatives. Whether online, over the phone, or in person, Rapid Consulting is ready to assist you in advancing your business goals in Haryana.