Agro Processing Cluster

Agro Processing Cluster (APC) - Central Govt (MoFPI)

EoI – Deadline for filing Initial (First) Application

Introduction to the APC Scheme

(Agro Processing Cluster Subsidy)

The Ministry of Food Processing Industries (MoFPI) launched the Agro Processing Cluster (APC) Scheme with updated operational guidelines on April 25, 2025. It is a sub-scheme under the Pradhan Mantri Kisan SAMPADA Yojana (PMKSY), the government’s flagship program for agro-industrial development. The APC scheme’s overall goal is to develop modern agro-processing clusters that link farmers and producers with processors and markets, reducing wastage and creating value addition at the farm gate . In essence, this is a food processing subsidy initiative – it incentivizes entrepreneurs through grants-in-aid to establish clusters of processing units, thereby strengthening the farm-to-fork supply chain in a concentrated area. The scheme aims to spur investment in rural food processing infrastructure, benefit farmers with better prices, and generate new employment in the agro-processing sector.

1. Reduce Post-Harvest Losses: Minimize wastage of agricultural and horticultural produce by providing processing and storage facilities close to production centers


2. Create Modern Infrastructure: Establish state-of-the-art processing, preservation, and storage infrastructure (e.g. cold storage, pack-houses, roads) in cluster format to modernize the food supply chain


3. Boost Farmers’ Income: Increase farmers’ income through value addition to their produce and better linkages to markets (aligning with the goal of doubling farmers’ income)


4. Generate Employment: Spur rural economic growth by creating direct and indirect jobs in food processing, handling, and allied activities within the clusters. (These objectives align with the broader goals of PMKSY, focusing on infrastructure, income enhancement, and waste reduction.)

1. Cluster Composition: : Each Agro Processing Cluster must contain at least 5 new food processing units set up together, with a minimum total investment of ₹25 crore across these units and common facilities . The units can be established by one or multiple entrepreneurs, but they should function as a group within the cluster.


2. Land Requirement: The cluster should be developed in a contiguous area – a minimum of 10 acres of land is required. The land can be owned by the project developer or taken on lease (with a minimum 50-year lease to ensure long-term use) . This land will host both the common infrastructure and the individual processing units. (For clusters in urban areas, a smaller land parcel (e.g. 5 acres) may be accepted if multi-story facilities are planned, but rural clusters typically require 10+ acres.)


3. Target Sectors: The scheme supports clusters in all segments of food processing – agri and horticultural produce (fruits, vegetables, grains, cereals), fisheries and aquaculture, dairy and animal products, and other agro-products can all be processed in these clusters. Each cluster may focus on one or more raw materials (e.g. a fruit processing cluster, a marine/fish processing cluster, an integrated food processing park, etc.), thereby catering to diverse sub-sectors of agro-processing. This flexibility ensures that clusters can be tailored to the local raw material availability and market demand.

Each approved agro processing cluster project comprises two main components of infrastructure development:

1. Basic Enabling Infrastructure: This refers to the foundational facilities for the cluster site – internal roads, boundary wall, drainage, water supply system (tanks, pipelines), power supply and distribution, effluent treatment plants (ETP) for waste management, etc. . These are essential services that create a fully functional industrial estate where food units can operate. External linkages (like approach roads, electricity from grid, water source) are typically facilitated with state/ local support, while internal infrastructure is part of the project.
2. Core Processing Infrastructure (Common Facilities): These are shared facilities and utilities that processing units in the cluster will use jointly . Examples include warehouses for raw material and finished goods storage, cold storages and ripening chambers for perishable produce, dry storage silos, individual quick freezing (IQF) units for frozen foods, specialized packaging and bottling units (tetra packing lines, etc.), quality control labs, sorting/grading and cleaning facilities, steam boilers or common effluent treatment specifically for processing needs, refrigerated vehicles/loading bays, and other need-based machinery . By providing these core facilities centrally, the cluster reduces the cost for individual units and ensures modern technology adoption.

Note - There are 50-50 chances for consideration of additional Units / Proposals

Agro Processing Cluster (APC) – Central Govt (MoFPI)

Eligible Entities for the Scheme

A wide range of entities are eligible to promote and implement an Agro Processing Cluster project. Both public and private sector organizations can apply, as individual proponents or as a consortium. Eligible project promoters include :

1. Government Agencies and PSUs: Central/State Government departments, public sector undertakings, or their joint ventures.
2. Cooperatives and Farmer Organizations:Registered Cooperative societies, Farmer Producer Organizations (FPOs), farmer producer companies, and other collective entities of farmers.
3. Self Help Groups (SHGs) and NGOs: Community-based organizations, trusts or NGOs involved in agro-processing or rural development.
4. Private Companies and LLPs: Private sector companies, including Limited Liability Partnerships and startups in the food processing sector, either individually or as a consortium/joint venture.
5. Partnership Firms and Proprietorships: Existing small and medium food processing enterprises or entrepreneurs operating as partnership firms or sole proprietors (with requisite financial capacity) are also eligible.

There is special encouragement for proposals led by entrepreneurs from Scheduled Castes/Scheduled Tribes (SC/ST) and by farmer collectives (FPOs/SHGs), as reflected in the scheme’s higher grant support for these categories (detailed below) and relaxed eligibility norms. All applicants must demonstrate the capability to invest in and execute the project – this includes showing adequate net worth and financial closure (tie-up of funds) at the time of proposal.

Under the APC scheme, MoFPI provides grants-in-aid (capital subsidy) to cover a portion of the project cost. The pattern of assistance is as follows:

1. Subsidy Rate (General vs. Special Areas/Groups): For projects in general areas, the grant is 35% of the eligible project cost. For projects promoted by SC/ST entrepreneurs, Farmer Producer Organizations, Self Help Groups, or those located in difficult areas – i.e. the North-East states (including Sikkim) and Himalayan states/UTs (Jammu & Kashmir, Ladakh, Himachal Pradesh, Uttarakhand), and notified Integrated Tribal Development Project (ITDP) areas or islands – the grant is higher, at 50% of the eligible project cost. This higher subsidy aims to encourage participation from marginalized groups and less-developed regions
2. Maximum Grant Ceiling: ₹10 crore per project is the maximum grant amount payable, regardless of project size. This means even if the calculated 35% / 50% of project cost exceeds ₹10 crore, the assistance will be capped at ₹10 crore. Promoters are free to invest more on their own, but the government’s contribution will not exceed ₹10 crore.
3. Credit Linkage: The grant-in-aid is credit-linked but not back-ended. Credit-linked means the project must have a sanctioned bank term loan (the subsidy is released in proportion to expenditure, alongside bank financing). Not back-ended means the subsidy is not given only at the project’s end – instead, it is released in installments as the project progresses (as described in the “Subsidy Disbursement” section), rather than as a reimbursement after completion. Promoters must thus secure a loan and start investing upfront; the grant comes concurrently with achievement of milestones.
4. Promoter’s Contribution & Net Worth Requirements: The remaining project cost (aside from the MoFPI grant) has to be financed by the promoters through a combination of equity and debt (bank loan). To ensure promoters have skin in the game, the scheme stipulates minimum net worth and contribution criteria. For general category projects, the combined net worth of the promoter(s) should be at least 1.5 times the grant amount sought, and a bank term loan (and equivalent equity infusion) should cover at least 20% of the total project cost. By contrast, in recognition of the constraints faced by SC/ST, FPO/SHG, and NE/hilly area projects, the requirements are relaxed – the promoters’ combined net worth only needs to be equal to the grant amount (i.e. 1:1 ratio) and a term loan with equity amounting to at least 10% of the project cost is sufficient (the rest of financing can be through other means or smaller equity). These relaxed norms make it easier for community-based and smaller players to qualify. (In all cases, proof of net worth and a sanction letter for the bank loan must be submitted with the application.)

Note “Eligible project cost” generally includes expenditures on plant & machinery and infrastructure (basic and core facilities) as per the DPR. As mentioned, land cost is excluded from this calculation for grant. The grant is disbursed only against actual expenditure incurred on eligible components, up to the approved limit.

Agro Processing Cluster (APC) Subsidy – Central Govt (MoFPI)

Application, Approval & Inspection Process

The APC scheme is implemented through periodic calls for proposals. MoFPI does not accept applications continuously; instead, it invites proposals via Expression of Interest (EOI) notifications from time to time (typically advertised on the MoFPI website and national press) . The application process is as below

1. EOI Notification: MoFPI publishes an EOI with details of the scheme, eligibility and selection criteria, and application window. Interested entrepreneurs/organizations must respond within the given timeframe. The scheme being demand-driven implies proposals are considered only when such calls are issued
2. Online Application through SAMPADA Portal: Applicants must register and apply through the SAMPADA portal (the dedicated online portal for PMKSY schemes). All required information is filledonline and relevant documents are uploaded . Key documents include a Detailed Project Report (DPR) outlining the cluster plan, cost estimates and business model; documents proving availability of land (registered sale/lease deed for the required 10 acres); bank sanction letter for the term loan component; promoters’ know-your-customer (KYC) and legal incorporation documents (such as Certificate of Incorporation, partnership deed or registration of society, etc.); audited financial statements or CA certificates demonstrating net worth; and any relevant clearances obtained or in process (like pollution control board NOCs, state government support letters, etc.).
3. Screening & Recommendation: Once submitted, proposals are initially screened by MoFPI or a designated Project Management Agency for completeness and adherence to eligibility norms. Deficient applications may be given a chance to clarify or may be rejected at this stage. Eligible proposals are then put up for further appraisal. (In some cases, State Governments are consulted or their recommendations sought, especially to confirm land availability and alignment with state plans.)
4. Presentation (if applicable): Promoters of shortlisted projects might be invited to present their proposal and business plan to an evaluation committee, providing clarifications on the cluster’s expected outputs, farmer linkages, etc. (This step helps in competitive selection if applications exceed the available quota.)

Once applications are submitted, the following step-by-step process ensues to approve and implement the project

1. Project Approval Committee (PAC) Evaluation: All eligible proposals are placed before a Project Approval Committee in MoFPI for final evaluation. The PAC – comprising senior officials and technical experts – examines the proposals on merits such as project viability, promoters’ background, availability of raw materials, value addition, and benefits to farmers. Projects are selected for award of grant based on merit and the available budget.
2. In-Principle Approval: If the PAC approves a project, MoFPI issues an In-Principle Approval (IPA) or sanction letter to the promoter (also called the Project Execution Agency, PEA). This letter outlines the basic terms of support, including the grant amount sanctioned and any conditions precedent that the PEA must fulfill. Common conditions include: acquiring the minimum required land; achieving financial closure (firm tie-up of the promoter’s equity and loan as per DPR); formation of a Special Purpose Vehicle (SPV) if the project is by multiple stakeholders; and obtaining necessary statutory clearances. The IPA is typically valid for a certain period (e.g. 6 months), within which the promoter must meet these conditions.
3. Signing of Agreement: After the PEA meets the stipulated conditions (substantiated by documents like land ownership papers, loan sanction, SPV incorporation certificate, etc.), a formal Grant Agreement is executed between MoFPI and the project entity. This agreement lays down the detailed operational guidelines, fund release schedule, and roles and responsibilities. The PEA may also be required to furnish a Bank Guarantee or surety bond equivalent to a portion of the grant (often equal to the first installment) as a security measure.
4. Release of 1st Installment: With the agreement in place, MoFPI releases the first installment of the grant (details on installments in next section). This typically occurs around the time the project breaks ground. The PEA then utilizes this along with its own funds to start development of the cluster – e.g. site development, constructing roads, setting up utilities, etc.
5. Project Implementation & Monitoring: The implementation phase usually spans 2 years (extendable for difficult areas). The PEA must concurrently develop the common infrastructure and facilitate the construction of the individual processing units by the entrepreneurs. Progress is monitored through regular reports and site visits. MoFPI often appoints a Project Management Agency (PMA) or a technical institution to assist in monitoring. The PEA must submit quarterly progress reports, and any deviations from the approved DPR must be reported and require approval.
6. Inspections for Subsequent Installments: Before each grant installment is released, joint inspections are carried out. A team from MoFPI/PMA visits the site to verify that the project has achieved the required milestones. For example, prior to the second installment, the inspection will confirm if the basic enabling infrastructure (roads, drainage, power, etc.) is largely in place and that construction of factory buildings for units is underway. These inspections ensure accountability and that government funds are being used as intended.
7. Release of 2nd Installment: Upon satisfactory progress (often around mid-way through project implementation, e.g. 50-60% project completion) and utilization of the first installment, the second installment of the grant is released. This infusion helps the PEA and unit owners to continue building the facilities and to purchase plant & machinery for the units.
8. Completion & Final Inspection: Once the cluster is fully developed, the PEA notifies MoFPI that the project is complete. Completion means all common facilities are constructed and at least 5 processing units are installed and ready for operations (trial production may have begun). MoFPI conducts a final inspection (or appoints an independent agency for evaluation) to verify the completion of the project as per the DPR: checking the infrastructure, equipment, and operational status of units. Any pending work or minor gaps are noted for rectification.
9. Release of 3rd (Final) Installment: After successful final inspection and submission of required documents (like expenditure statements audited by a CA, unit commissioning reports, etc.), MoFPI releases the final installment of the subsidy. With this, the government’s funding commitment is fully disbursed. The project is officially considered commissioned. A completion certificate may be issued.
10. Post-Commissioning Compliance: The PEA must continue to submit performance reports for a few years as required. MoFPI may conduct post-project evaluations or audits to assess outcomes (like how many farmers benefited, volume of raw material processed, etc.). The PEA is expected to ensure the cluster remains operational and the common facilities are maintained during the binding period (typically 6 / 8 years from completion, during which the assets cannot be sold or repurposed without approval). Inspections may be done to ensure the cluster is being utilized for the intended food processing activities.

Throughout this process, transparency and accountability are emphasized. Projects that fail to meet milestones or misuse funds can be subject to penalties (as detailed next). The multi-stage approval and inspection mechanism ensures only serious proposals are approved and that funds are released only on verified progress.

Central Food Ministry (MoFPI) – APC

Subsidy Disbursement Schedule

The approved grant (subsidy) is disbursed in three installments, tied to specific project milestones and timelines . The timeline for fund release is designed to enforce timely implementation:

1. 1st Installment (Initial mobilization): This installment (approximately 33.33 % of the total grant) is released after the PEA has secured the land, financial closure, and commenced site work. Typically, the conditions for first disbursement include proof of 100% land acquisition/lease, spending of a certain minimum amount of the promoter’s contribution, and any key clearances. The first installment must be claimed within 8 months of the project’s approval (within 10 months for North East/difficult area projects). This ensures the project launches promptly.
2. 2nd Installment (Mid-term progress):The second tranche of funds (around 33.33 % of the grant) is released upon achieving significant progress – usually about 60% of the project cost should be expended and key infrastructure should be in place. For instance, the roads, drainage, and buildings for common facilities should be mostly constructed, and a couple of the processing units should be in advanced stages of setting up. This milestone is expected by around 16 months from approval (within 20 months for NE/hilly areas). An inspection/verification is conducted to confirm these targets before releasing the funds.
3. 3rd Installment (Final completion): The final installment (the remaining 33.33% or so of the grant) is released after full completion of the cluster – meaning all common facilities are completed and at least five units are operational (or ready to operate). The project must reach this stage within 24 months of the sanction date (a maximum of 30 months is allowed for projects in NE/difficult regions). A detailed final inspection and audit is done at this stage. Only after verifying that the cluster is functional in all respects, the final grant amount is disbursed. This stage marks the successful commissioning of the cluster

Each installment is released to the PEA’s bank account (often escrowed) and must be used strictly for the project. The PEA is required to submit Utilization Certificates and expenditure statements after using each installment, to be eligible for the next. If the project misses these timelines or fails to achieve the defined milestones, the release of funds can be withheld or cancelled, and the project may fall under penalties as described below.

Central Food Ministry (MoFPI) – APC

Project Implementation Guidelines & Requirements

Implementing an Agro Processing Cluster is a complex task, and the scheme guidelines lay out various requirements to ensure the project’s success and sustainability. Key implementation guidelines include:

1. Timeframe for Completion: The project should be completed within 24 months from the date of final approval. Projects in North-East or difficult areas are given up to 30 months. This includes construction of all facilities and making the units operational. The clock starts after the sanction letter, and the PEA must plan activities (design, tendering, construction, machinery installation) to meet this deadline. Regular monitoring will track this progress. If delays occur due to valid reasons (e.g. land conversion, environmental clearance delays, or force majeure situations), the PEA must inform MoFPI in advance and seek approval for extension. Minor extensions may be granted case by-case, but the overall emphasis is on timely completion
2. Regulatory Compliance: The PEA is responsible for obtaining all statutory clearances and compliance relevant to the project . This includes land-related approvals (e.g., Change of Land Use permission if the land was agricultural), construction permits from local authorities, environmental clearances and pollution control board consents (especially since food parks include boilers, ETPs, etc.), and FSSAI licenses for food processing operations. Compliance with local zoning and safety regulations (fire safety, building codes) is mandatory. The project must also adhere to quality standards for food processing – common facilities like labs help ensure all units maintain food safety standards (HACCP, ISO certifications, etc.). Any non-compliance can lead to project suspension, so the PEA must proactively manage this aspect.
3. Sustainability and Green Initiatives: The guidelines encourage clusters to incorporate sustainable and energy-efficient practices. An Effluent Treatment Plant (ETP) is mandatory to handle waste water from processing units, ensuring no pollution of local water sources . The infrastructure design should include provisions for solid waste management (e.g. conversion of organic waste to compost or bioenergy). Use of renewable energy is promoted – for example, installing solar panels on roofs of warehouses or using biomass boilers can reduce operating costs and carbon footprint. Rainwater harvesting structures are advised to conserve water. Such features not only make the cluster environmentally friendly but also eligible for any additional incentives (some states or ministries have green grants).
4. Land and Common Facility Usage: The PEA (or SPV) will develop the land and may sell or lease plots within the cluster to individual entrepreneurs who will set up the processing units. However, the common infrastructure facilities created with the grant cannot be sold or leased out to a single entity – they must remain collectively owned resources for the cluster 19 . In practice, this means the roads, common utility center, warehouses, etc. are typically owned by the SPV/PEA and offered to all units in the cluster for use (often on a user charge or service fee basis to cover maintenance costs). For example, the cold storage built with grant funds should be accessible to any unit in the cluster (and even farmers or processors from outside, if capacity allows, on a pay-per-use basis) rather than being exclusively controlled by one company. This ensures wider benefit and prevents misuse of subsidized assets. The PEA may lease/sell built-up factory sheds or developed plots to food processors, but with the stipulation that those processors utilize the common facilities and abide by cluster rules.
5. Operations & Maintenance (O&M): It is the responsibility of the PEA/SPV to ensure proper maintenance of the common facilities and infrastructure. The grant does not cover O&M expenses, so the cluster must be run on a viable commercial model. This usually involves collecting user charges or maintenance fees from the units for services like cold storage usage, water/electricity supply, effluent treatment, etc. The PEA should establish a governance framework for the cluster – for instance, a committee of unit representatives – to oversee operation of common facilities. The guidelines often require the cluster to operate for a minimum period (e.g. 6 / 8 years) after completion, during which the PEA cannot dismantle or divest the facilities funded by the grant. If an entrepreneur occupying a plot exits, the PEA must find a replacement so that the unit does not remain idle for long. The goal is to ensure long-term sustainability and that farmers and local producers continuously benefit from the cluster.

Adhering to these implementation guidelines is crucial. MoFPI (and possibly state authorities) will periodically review the cluster even after its launch, to verify that it continues to serve the intended purpose (processing agricultural produce and benefiting producers). Any violations (like misuse of common facilities, inactivity, or change of project scope) could invoke penalties or require the grant to be refunded.

The scheme includes penalty provisions to discourage non-compliance and to protect public funds. Someof the key penalty conditions are:

1. Delays in Implementation: Time is of essence in the APC scheme. If a project fails to meet the prescribed timelines (e.g., not achieving completion within 24/30 months) without valid justification, MoFPI can cancel the project and cease further fund releases. In such cases, the PEA may have to refund any grant amounts already received, often with applicable interest (since that money was given for a specific purpose in a specific timeframe). In practice, MoFPI may give a short grace period or an extension (typically no more than 6-12 months in total for very genuine cases), but this often comes with a penalty in the form of reduced grant – for example, a certain percentage of the grant may be deducted for each quarter of delay. Additionally, if a performance bank guarantee was furnished, it may be forfeited (encashed by the government) if the project delays excessively or fails to complete.
2. Project Withdrawal/Abandonment: If the promoter decides to withdraw from the project after sanction – or if the project simply isn’t executed and is abandoned – the approval is deemed cancelled. In such scenarios, the promoter/PEA must return any funds that were disbursed by MoFPI. Moreover, the guidelines usually stipulate that this refund be with interest (to ensure there’s a cost to holding government money without utilization). The entity may also be debarred from future schemes of MoFPI for a certain period, as a consequence of failing to perform after blocking a slot that could have gone to another viable project. This penalty ensures only serious players apply and discourages frivolous proposals.
3. False Information or Fraud: The application and implementation process is expected to be truthful and transparent. If at any stage it is discovered that the project obtained approval based on false information, fabricated documents, or fraudulent claims, MoFPI will immediately cancel the project. All granted funds would become recoverable with interest. Additionally, the promoters and associated company can face legal action for fraud. This may include blacklisting from all government subsidy programs, and even criminal proceedings if forgery or misappropriation is involved. For example, if an applicant misrepresents their net worth or submits a bogus bank loan sanction letter to get approval, that is grounds for cancellation. The strict stance on this ensures the integrity of the selection process.
4. Reduction in SC/ST or FPO Stake (Post-Approval): The scheme provides higher subsidy (50%) to projects with significant SC/ST or FPO/SHG ownership to encourage those groups. To prevent misuse (like a general category promoter adding an SC/ST partner just to get approval and then later removing them), the guidelines enforce a lock-in of the beneficiary profile. Any dilution of the stake/role of the SC/ST, FPO or SHG stakeholders below a certain threshold during the project implementation or a specified period after completion is not allowed. If such a change occurs (for instance, if an SC/ST promoter who was the lead shareholder exits the project or reduces their equity significantly), MoFPI may reclassify the project as a general category project and reduce the grant from 50% to 35%. The PEA would then have to refund the excess grant received. In drastic cases, it could even lead to cancellation of the grant entirely. Essentially, the special category beneficiaries must remain genuinely involved in the project; otherwise the privilege is withdrawn. This clause protects the intent of the scheme’s affirmative action component.
5. Non-Operational Units: While not exactly a “penalty” in terms of fines, another condition is that at least 5 units must become operational in the cluster. If the PEA builds the infrastructure but fails to get the minimum units running, the project is considered incomplete (as seen by the scheme’s own definition). In such a case, MoFPI can withhold the final installment or not issue a completion certificate. Continued failure to populate the units could lead to grant recovery. This incentivizes the PEA to not just build infrastructure, but also ensure actual businesses start operating and benefiting farmers.

All these penalties are communicated in the approval letter and agreement. The overarching principle is that the grant is conditional – if conditions are not met, MoFPI has the right to take back the assistance. Project promoters are therefore expected to exercise due diligence, maintain transparency, and fulfill their commitments to avoid such punitive actions.

Flow Application From EOI to Final Subsidy Disbursement

(Agro Processing Cluster Subsidy)

Below is a timeline flow of the entire process, from application to completion, highlighting key milestones and their expected timing:

1. EOI & Application (Month 0): MoFPI releases an EOI. Eligible entities prepare DPRs and apply online via the SAMPADA portal within the deadline
2. Evaluation & Approval (~Month 2-3): Proposals are evaluated. The Project Approval Committee approves selected proposals around 2-3 months from EOI. Sanction letters (In-Principle Approval) are issued to successful applicants
3. Promoter Readiness (Month 0-6): The project promoter completes pre-project activities: forms SPV (if required), secures land (by Month 6), obtains initial clearances, and ties up the bank loan and equity. By around 6 months, all conditions precedent for the grant are met, enabling the project to kick off construction.
4. 1st Installment Release (by ~Month 8 or 10): Upon proof of land acquisition, financial closure, and initial site development, MoFPI releases 1st installment (33.33 % of grant). This is within 8 months of approval for general areas (10 months for NE/difficult areas).
5. Infrastructure Development (Month 6-16): Full-fledged construction is underway. Basic enabling infrastructure (roads, power, water lines, etc.) is laid out in months 6-12. Parallelly, building of common facilities and individual unit factories progresses. By around Month 16 (or 20 for NE states), the project should achieve 60 % completion – e.g. infrastructure ready and some processing units installed.
6. 2nd Installment Release (by ~Month 16 or 20): After a mid-term inspection confirms substantial progress, MoFPI releases the 2nd installment ( 33.33 % of grant) by about the 16th month (20th month for NE/hilly areas). This infusion helps complete remaining works.
7. Cluster Completion (by Month 24 or 30): The cluster achieves full completion by Month 24 (general areas) or Month 30 (NE/difficult). All common facilities are built, tested, and ready. At least five food processing units are fully set up – machinery installed and trial runs initiated. The cluster is now essentially operational.
8. Final Inspection & 3rd Installment (Month 24/30): MoFPI conducts a final inspection around the 24-30 month mark. Upon verifying that the cluster meets all requirements, it releases the 3rd installment (remaining 33.33 % of grant). This final disbursement closes the project’s financials. Post-Completion (Beyond Month 24/30): The cluster enters the operational phase. Processors in the cluster start commercial production, sourcing raw material from farmers and utilizing the common facilities. The PEA manages the cluster’s O&M and submits periodic performance reports. MoFPI may do follow-up reviews at 12 months and 24 months post-completion to ensure the cluster is running successfully and benefiting the stakeholders as envisioned

This flow from EOI to final subsidy payment typically spans two to two-and-a-half years. By the end of this timeline, the region gets a new Agro Processing Cluster – a modern food processing hub that is expected to reduce waste, add value to agricultural produce, and create an ecosystem of prosperity for farmers and entrepreneurs alike.

Sources: The information above is based on the APC Scheme Operational Guidelines (25-04-2025) and related official documents and announcements , as well as the Pradhan Mantri Kisan SAMPADA Yojana framework . These guidelines outline the rules and support under the MoFPI Agro Processing Cluster Scheme, a key component of India’s food processing infrastructure initiatives.

FAQ'S