Chhattisgarh goes all out to woo investors in food processing sector

With abundant production of crops, forest produce and livestock products, Chhattisgarh is going all out to woo investors in the food processing sector.

A statement from the central Indian State said that there is a huge gap between what is produced and processed in agriculture. Chhattisgarh is well-placed to fill the gap as it sees an opportunity in this. 

“The State sits atop a diverse and substantial agricultural base,” the statement said. Paddy production is 11.5 million tonnes, with corn, wheat, chana, and tivda (blue sweet pea) adding further depth to the food grain supply. 

Horticulture output has zoomed, with vegetable production being 67.89 lakh tonnes (lt), fruits  24.30 lt, and spices 4.62 lt in spices, alongside plantation crops, aromatics, and medicinal plants. Minor forest produce such as mahua, tamarind, sal seed, aonla, and harra also contribute to the State’s agro-forestry production. 

Niche opportunities

These are largely underprocessed and present niche, high-margin opportunities for value-added manufacturing. Milk production at 17.47 lt and fish production at 8.7 lakh tonnes also contribute to the State’s rising significance in agricultural production, the statement said.

Led by rice, vegetable oils, shellac, and spices, the total agri export value from the State is around ₹11,000 crore. 

According to Prabhat Malik, Director Industries, Department of Commerce & Industries, Government of Chhattisgarh, the State grows an extraordinary range of crops, forest produce, and livestock products, and most of it leaves the state in raw form. 

“That is precisely where the investment opportunity lies. Our policy is specifically designed to make it financially compelling for processors to set up here, close to the source, rather than add cost and spoilage across a long supply chain,” he was quoted in the statement. 

Raw material advantage

The official said the raw material advantage is real and incentives make it decisive.

Agro and food processing has been designated a thrust sector under the Industrial Development Policy (IDP) 2024–30. It makes investors qualify for a comprehensive special incentive package on investments of ₹50 crore and above in plant and machinery. 

The package includes a fixed capital Investment subsidy of 30 per cent, with an employment booster multiplier of up to 1.5x. Investors may alternatively opt for Net SGST reimbursement for 12 years instead of the fixed capital investment (FCI) subsidy, the statement said. 

Additional benefits include an interest subsidy of 50 per cent up to ₹20 crore per year for five years and 100 per cent electricity duty exemption for 12 years. Land-related benefits include 100 per cent stamp duty exemption and 50 per cent relief on registration and land conversion fees. 

Investors also receive 75 per cent employees’ provident fund reimbursement, employment generation assistance of 20 per cent of salary for five years, a 50 per cent ETP subsidy up to ₹1 crore, and a transport subsidy for export of 75 per cent of costs for 10 years, capped at 35 per cent of FCI. 

Feature of policies

The statement said a feature of the policies is the 100 per cent Mandi (terminal agri markets) fee exemption for five years up to ₹5 crore per year, which directly reduces a recurring input cost that most competing states do not address. 

On an illustrative FCI of ₹100 crore with 250 employees, the total incentive package works out to approximately ₹68.80 crore, nearly 69 per cent of the investment, the statement said, adding that the first five anchor units investing ₹200 crore or more receive additional incentives, with investments above ₹1,000 crore qualifying for customised packages. 

It said Chhattisgarh has developed food processing infrastructure at both the state and district levels. An established Food Park in Dhamtari provides ready industrial infrastructure, while food parks recently opened for allotment span 10 districts, including Surajpur, Surguja, Jashpur, Bemetera, Raipur, Rajnandgaon, Gariaband, Kanker, and Sukma, placing processing capacity close to agricultural production zones and reducing raw material transit costs. 

“For quality assurance, the state has fertilizer quality control laboratories, seed and soil testing labs, and an upcoming food testing laboratory by MOFPI in Nava Raipur. Over 70 industrial areas across the state provide further options for larger integrated processing units, all with developed internal roads, power, and water supply,” it said.

Power-surplus State

Chhattisgarh is the country’s largest power-surplus state, with zero power cuts in industrial areas and high tension tariffs starting at ₹6.65 per unit, a material cost advantage for energy-intensive food processing operations. 

The state’s location at India’s geographic centre, bordering seven States and accessing a 51-crore population catchment, reduces distribution costs to both domestic consumption markets and export gateways, the statement said. 

On the labour front, the State supports with industrial training institutes and through dedicated food processing institutions, including the College of Food Processing at Indira Gandhi Krishi Vishwavidalaya and the College of Dairy Science and Food Technology. Chhattisgarh’s Right to Skill Act, the first such legislation in India, reinforces this with an enforceable commitment to vocational training.

Published on May 11, 2026