Promoting Food Processing Through Food Parks And Food Processing Special Economic Zones: The Indian Experience

This study evaluates the performance of food processing clusters and their role in the development strategy of the food processing industry in India. We focus on two major cluster development initiatives of the Government of India: one, a food park scheme of the Ministry of Food Processing, and two, a special economic zone (SEZ) policy of the Ministry of Commerce. While analyzing the performance of these initiatives, the study adopts a comprehensive framework which covers not only the quantitative measures of investment, employment, and production but also qualitative indicators such as dynamism of the parks and backward and forward linkages with the rest of the economy, regional economy and cluster-induced benefits. The analysis is based on interviews with chief executive officers of the selected parks, officials of the Ministry of Food Processing and developers of selected parks and SEZs. It is complemented by secondary data based analysis. The study shows that overall the schemes have failed to generate critical mass of economic activity and their achievements have been unimpressive, apart from a few exceptions. It concludes that implementing successful, large-scale industrialization programs involving private participation requires of policymakers a long-term vision, strong commitment, a pragmatic and flexible approach, and dynamic learning and institution building.