UP Food Processing Industry Policy 2023: Incentives Push Value Addition, Investment and Rural Industrialisation
Uttar Pradesh’s Food Processing Industry Policy 2023 seeks to strengthen the state’s food-processing ecosystem by promoting investment, value addition, modern infrastructure and stronger linkages between farmers and processing units. The policy is designed to help convert Uttar Pradesh’s large agricultural output into higher-value processed products while improving market access for food-processing enterprises.
A key component is the capital subsidy of 35% on expenditure incurred on plant, machinery and technical civil works for new food-processing units, subject to a maximum of ₹5 crore. Expansion and modernisation projects are also eligible for capital support, subject to prescribed limits. The policy additionally provides 100% exemption from stamp duty on land purchased for establishing food-processing industries and concessions related to land-use conversion and external development charges.
The policy places significant emphasis on infrastructure. Cold-chain and value-addition projects can receive subsidies, while agro-processing clusters are eligible for grants of up to ₹10 crore, subject to eligibility conditions. Support is also provided for backward and forward linkages, reefer vehicles and mobile pre-cooling infrastructure.
For export-oriented units, Uttar Pradesh provides a 25% freight subsidy on eligible transportation costs, excluding exports to Nepal, Bangladesh and Bhutan. The policy also provides mandi-fee and cess exemptions in specified cases, including agricultural produce supplied directly by farmers to processing units.
The broader governance objective is to build an integrated farm-to-market processing ecosystem—linking farmers, processors, cold chains, technology and export markets. This can support greater value addition to agricultural produce while creating avenues for rural entrepreneurship and private investment across Uttar Pradesh.
