Food Processing Industry (FPI) Subsidy Rate in Kerala

Updated on June 19, 2025 02:53:20 PM

The Capital Investment Subsidy schemes were instituted by the Ministry of Food Processing Industries (MoFPI) of the Government of India in the food processing industry to promote the business in Kerala. Any new business that is started in the state is eligible to redeem subsidy plans which offer reimbursement based on the amount of investment business owners made over equipment, establishment, transport and more. Any business started by MSMEs in the districts of Idukki, Wayanad, Kasargod and Pathanamthitta are eligible to redeem additional support of 10% up to Rs 10 lakhs.

The subsidy plans for entities in Kerala are designed for the expansion of businesses and to create job opportunities and more through the FPI subsidy to boost the growth of economy and sales. In the following article, you will learn about the FPI subsidy programs in Kerala as well as its benefits that will aid the businesses in Kerala.

The benefits of the subsidy rates in the Food Processing Industry (FPI) in Kerala is written below.

1. Economic Development:The FPI subsidy has a positive impact on the local economy as it supports businesses to improve import and export of goods.
2. Market Expansion:Local businesses can utilize the FPI subsidy to expand the markets beyond their region and compete in bigger regions.
3. Job Creation:The FPI subsidy in Kerala provides job opportunities to locals and increases employment which results in betterment of living standards.
4. Cost Reduction: The FPI subsidy helps to lower transport costs for businesses in Kerala, which makes transport of goods and services sustainable and cost efficient for both businesses and consumers
5. Encouraging Entrepreneurship:The FPI subsidy also makes it easier to start up new businesses and helps to create a more lively and varied local economy

Under the Food Processing Industry (FPI) subsidy rate in Kerala, the maximum subsidy amount is granted to ensure that the scheme aids in prevention of exploitation or unfairness of the intermediary. The subsidy rate in Kerala is categorized under one classes which is

• Fixed Capital Rebate

  Maximum Subsidy Rate	Maximum Subsidy Amount	Limitations
  15%	Limited to Rs 20 lakhs	Only for General Category Assistance
  20%	Limited to Rs 30 lakhs	Only for Young (18 to 45 years), Women, and SC/ST entrepreneurs

The Food Processing Industry (FPI) subsidy in Kerala aims to boost the economy and financial standing of local businessmen in the region. The following are some of the features of FPI subsidy in Kerala:

1. Disbursement of loan will be simple: The "moratorium" phase is the period when no revenue is generated at the beginning of the project implementation; hence, simple interest is used to calculate the interest on the portion of the loan that has been paid out during the "moratorium" phase. After the moratorium phase is over, all loans have compound interest, although the interest rate is progressively reduced.
2. Improve in prospect buyer: Various advantages are provided to potential purchasers, including consumers, food processing industries (FPI), exporters, and more to be efficient intermediaries.
3. Frequent disbursement of loans: To follow up the implementation period, the loan and FPI subsidy will be disbursed in phases over a tenure of 3 to 5 years with intervals of 3 to 6 months.