Agro Processing Cluster (APC) Scheme
Comprehensive information about the APC scheme by the Ministry of Food Processing Industries.
Overview of Agro Processing Cluster Scheme
What is Agro Processing Cluster?
The Agro Processing Cluster (APC) is a scheme implemented by the Ministry of Food Processing Industries (MoFPI) under the Pradhan Mantri Kisan Sampada Yojana (PMKSY). It aims to create modern infrastructure for food processing closer to production areas.
The scheme follows a cluster-based approach, which involves developing infrastructure and common facilities in areas with strong agricultural production to encourage entrepreneurs to set up food processing units.
By establishing these clusters, the scheme aims to reduce wastage, increase value addition, and enhance farmers' income while creating employment opportunities in rural areas.
Objectives of the Scheme
- Create modern infrastructure for food processing closer to production areas
- Reduce post-harvest losses and ensure better price realization for farmers
- Increase processing level of agricultural produce and enhance value addition
- Create employment opportunities, particularly in rural areas
- Strengthen the supply chain from farm to market with modern infrastructure
Financial Assistance Under APC Scheme
| Parameter | Details |
|---|---|
| Grant-in-aid | 35% of the eligible project cost |
| Maximum Grant Limit | ₹10 crore per project |
| Minimum Investment | ₹10 crore |
| Land Requirement | Minimum 15 acres |
| Project Implementation Period | Maximum 24 months from date of approval |
Eligibility Criteria
Eligible Organizations
- Registered Farmer Producer Organizations (FPOs)
- Self Help Groups (SHGs)
- Cooperatives
- Private Companies
- Corporate Entities
- Central/State PSUs and Joint Ventures
- NGOs, including Trusts and Societies
- Industry Associations
Basic Requirements
- Minimum land area of 15 acres with clear title and possession with the applicant
- Minimum investment of ₹10 crore excluding land cost
- At least 5 food processing units with a minimum investment of ₹25 crore
- At least 10 acres of land for core processing facilities
- Project implementation period of maximum 24 months
- Adequate financial capability to execute the project
- Special Purpose Vehicle (SPV) to be formed for project implementation
Special Provisions
For Hilly & Difficult Areas:
- Minimum land requirement reduced to 10 acres
- Grant-in-aid increased to 50% of eligible project cost
- Maximum grant limit remains ₹10 crore
For North-Eastern States:
- Minimum land requirement reduced to 10 acres
- Grant-in-aid increased to 50% of eligible project cost
- Minimum investment reduced to ₹5 crore
Components of APC Scheme
Eligible Components for Financial Assistance
The APC scheme provides grant-in-aid for the following components:
Basic Enabling Infrastructure
- Site development including boundary wall, internal roads
- Water supply system including water treatment plant
- Power supply system including power backup
- Drainage and effluent treatment facilities
- Parking facilities, street lighting
Core Infrastructure
- Multi-purpose buildings for administrative office, training center
- Standard design factory buildings for SMEs
- Warehouses, cold storage, deep freezers
- Quality control labs and testing centers
- Common processing facilities
Factory Buildings
- Standard design factory buildings for SMEs
- Plug and play facilities for food processing units
- Individual quick freezing facilities
Support Infrastructure
- Dormitories/workers' hostel for workers
- Canteen/cafeteria facilities
- Trade facilitation centers
Ineligible Components
The following components are not eligible for financial assistance under the APC scheme:
- Cost of land and land development
- Margin money, working capital, and personal expenses
- Interest during construction
- Fuel, consumables, spares, and stores
- Second-hand/used machinery and equipment
- Residential buildings and guest houses
- Retail outlets or showrooms
- Vehicles, transport equipment, and furniture for office use
Application Process
Step 1: Expression of Interest
Submit an Expression of Interest (EOI) to the Ministry of Food Processing Industries as per the prescribed format available on the ministry's website.
Step 2: Initial Screening
The EOI is screened by the Program Management Agency (PMA) appointed by the ministry to check eligibility and completeness of the application.
Step 3: Detailed Project Report
If the EOI is approved, prepare and submit a Detailed Project Report (DPR) with comprehensive information about the proposed project.
Step 4: Technical Evaluation
The PMA conducts a technical evaluation of the DPR and may visit the proposed site for verification and assessment.
Step 5: Inter-Ministerial Approval Committee
The project is presented before the Inter-Ministerial Approval Committee (IMAC) for final approval and sanction of grant.
Step 6: Approval Letter
Upon approval, the ministry issues an approval letter specifying the approved components and grant amount.
Step 7: Implementation & Monitoring
Project implementation begins with regular monitoring by the PMA and ministry officials to ensure adherence to approved plans.
Step 8: Release of Grant
The grant is released in installments based on the progress of the project and utilization of previously released funds.
Required Documents
For Expression of Interest (EOI)
- Duly filled EOI application form
- Registration certificate of the organization
- Land documents (ownership/lease deed)
- Land conversion certificate for industrial use
- Preliminary project report with basic details
- Details of promoters and their experience
- Proof of financial capability to implement the project
For Detailed Project Report (DPR)
- Comprehensive project report with technical details
- Detailed layout plan of the proposed cluster
- Component-wise cost estimates with quotations
- Means of finance with supporting documents
- Bank appraisal and sanction letter (if applicable)
- Implementation schedule with PERT/CPM charts
- Details of proposed food processing units in the cluster
For Release of Grant
- Request letter for release of grant
- CA certificate for expenditure incurred
- Bank statement showing expenditure
- Utilization certificate for previous installment
- Invoices/bills of expenditure incurred
- Progress report with photographs
- Inspection report by PMA
- Compliance report of conditions in approval letter
Frequently Asked Questions
The Agro Processing Cluster (APC) scheme is a central sector scheme under the Pradhan Mantri Kisan Sampada Yojana (PMKSY) implemented by the Ministry of Food Processing Industries. It aims to create modern infrastructure for food processing closer to production areas by following a cluster-based approach.
Organizations eligible to apply include Farmer Producer Organizations (FPOs), Self Help Groups (SHGs), Cooperatives, Private Companies, Corporate Entities, Central/State PSUs and Joint Ventures, NGOs including Trusts and Societies, and Industry Associations. The applicant must have the financial capability to implement the project and meet the basic requirements.
The minimum land requirement is 15 acres with clear title and possession with the applicant. For hilly and difficult areas, including North-Eastern states, the minimum land requirement is reduced to 10 acres. At least 10 acres of land should be earmarked for core processing facilities.
The scheme provides grant-in-aid of 35% of the eligible project cost with a maximum limit of ₹10 crore per project. For hilly and difficult areas, including North-Eastern states, the grant-in-aid is increased to 50% of the eligible project cost, with the maximum limit remaining at ₹10 crore.
The minimum investment required is ₹10 crore excluding land cost. For North-Eastern states, the minimum investment is reduced to ₹5 crore. Additionally, the project should have at least 5 food processing units with a minimum investment of ₹25 crore.
The maximum timeline for project implementation is 24 months from the date of approval. Extensions may be granted in exceptional circumstances, but delays can lead to cancellation of the project and recovery of the grant amount with interest.
The grant is released in installments based on the progress of the project and utilization of previously released funds. Typically, the first installment is released after the project has achieved 30% of the financial progress, the second installment after 60% progress, and the final installment after completion of the project and submission of all required documents.
No, the cost of land and land development is not eligible for financial assistance under the APC scheme. Other ineligible components include margin money, working capital, personal expenses, interest during construction, fuel, consumables, spares, stores, second-hand/used machinery and equipment, residential buildings, guest houses, retail outlets, and vehicles for office use.