India is the world's second largest producer of food next only to China. It has the potential of becoming the biggest with the food and agricultural sector contributing around 26% of India's total GDP. Food Processing industry is of enormous significance for India's development and it acts as a vital linkage between the two most important sectors of the Indian economy i.e. industry and agriculture. In the last decade, India moved from an era of scarcity to surplus in regards to Food. The Food Processing Industry in India is on an assured track of growth and profitability over the coming decades. It is estimated that it will attract phenomenal investment -capital, human, technological and financial of over Rs 1,40,000 crores in the next decade. The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food and food processing technologies, skills and equipment, especially in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries, Milk & Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic Beverages & Soft Drinks and Grains are important sub-sectors of the food processing industry. Health food and health food supplements are another rapidly rising segment of this industry which is gaining vast popularity amongst the health conscious.

As per a study conducted by McKinsey and Confederation of Indian Industry (CII), the turnover of the total food market is approximately Rs.250,000 crores (US $ 69.4 billion) out of which value-added food products comprise Rs.80,000 crores (US $ 22.2 billion). Since the liberalization in August, up-till February 2000 proposals for projects of over Rs.53,800 crores (US.13.4 billion) have been proposed in various segments of the food and agro-processing industry. Besides this, the Government has also approved proposals for joint ventures, foreign collaboration, industrial licenses and 100%export oriented units envisaging an investment of Rs.19,100 crores (US $ 4.80 billion) during the same period. Out of this, foreign investment is over Rs. 9100 crores (US $ 18.2 billion).