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| Scheme Policy | Details |
|---|---|
| Policy Name | Andhra Pradesh Food Processing Policy 4.0 (2024–29) |
| Original G.O. | G.O.Ms.No.71, Industries & Commerce (Programme-III), dated 26-10-2024 |
| Amendment 1 | G.O.Ms.No.23, dated 17-02-2025 — enhanced benefits for eligible special-category enterprises |
| Amendment 2 | G.O.Ms.No.104, dated 26-06-2025 — adoption of revised MSME classification effective 01-04-2025 |
| Nodal Agency | Andhra Pradesh Food Processing Society (APFPS) |
| Coverage | Entire State of Andhra Pradesh |
| Policy Period | 5 years: 26-10-2024 to 25-10-2029 |
| Main Objective | Promote primary, secondary and tertiary food processing, value addition, reduce post-harvest losses, improve exports, create employment and develop food-processing clusters |
| Major Focus | Agriculture, horticulture, aqua, dairy, poultry, meat, fisheries, cereals, pulses, fruits, vegetables, spices, millets, organic food and allied food-processing activities |
| Maximum combined incentive principle | The original policy provides that the overall incentive package under the policy/subsequent policies should not exceed 75% of FCI, subject to the applicable rules. |
| Application mechanism | AP Single Desk/State incentive mechanism, with APFPS as nodal agency for FPP incentives |
The policy covers both new and expansion projects.
Eligible projects
Special-category enterprises
The 2025 amendment provides an additional 10% subsidy, within the applicable maximum cap, for enterprises wholly owned by eligible:
subject to the policy's local-domicile/ownership conditions.
The Food Processing Policy is much broader than a conventional food-manufacturing subsidy.
Agriculture & food processing
Animal & allied sectors
Value-added food
Infrastructure / support activities
The policy also supports:
This is an important area because the classification was changed in 2025.
Current classification for investments from 01-04-2025
| Category | Investment / FCI Band |
|---|---|
| Micro | Up to ₹2.5 crore under revised MSME classification |
| Small | Above ₹2.5 crore to ₹25 crore |
| Medium | Above ₹25 crore to ₹125 crore |
| Large | Above ₹125 crore to ₹200 crore |
| Mega | Above ₹200 crore |
Important transitional point
The amendment retains detailed incentive slabs based on investment bands, including:
Therefore, the enterprise's investment date and applicable classification must be checked when determining the exact incentive slab.
This is one of the major benefits.
Primary Processing
Under the current amended slab structure:
| Investment slab | Capital Subsidy | Maximum |
|---|---|---|
| Up to ₹1 crore | 25% of FCI | ₹25 lakh |
| >₹1–₹2.5 crore | 25% | ₹50 lakh |
| >₹2.5–₹10 crore | 25% | ₹1.5 crore |
| >₹10–₹25 crore | 25% | ₹5 crore |
| >₹25–₹50 crore | 25% | ₹7 crore |
| >₹50–₹125 crore | 15% | ₹15 crore |
| >₹125–₹200 crore | 15% | ₹25 crore |
The disbursement period is generally linked to the generation of the first tax invoice, ranging from 2 to 5 years depending on the slab.
The policy gives higher support to value-added processing.
| Investment slab | Capital Subsidy | Cap |
|---|---|---|
| Up to ₹1 crore | 35% of FCI | ₹35 lakh |
| >₹1–₹2.5 crore | 35% | ₹80 lakh |
| >₹2.5–₹10 crore | 35% | ₹3.5 crore |
| >₹10–₹25 crore | 35% | ₹6 crore |
| >₹25–₹50 crore | 35% | ₹8 crore |
| >₹50–₹125 crore | 15% | ₹15 crore |
| >₹125–₹200 crore | 15% | ₹25 crore |
The higher subsidy for secondary/tertiary processing reflects the policy's emphasis on value addition rather than only primary processing.
For enterprises wholly owned by eligible local-domicile Women/BC/SC/ST/Minority/Specially-abled/Transgender entrepreneurs, the February 2025 amendment provides an additional 10% subsidy, subject to the relevant maximum cap.
The amended special-category table provides, for example:
Primary processing
| Investment slab | Subsidy | Cap |
|---|---|---|
| Up to ₹1 crore | 35% | ₹35 lakh |
| >₹1–₹2.5 crore | 35% | ₹80 lakh |
| >₹2.5–₹10 crore | 35% | ₹3.5 crore |
| >₹10–₹25 crore | 35% | ₹6 crore |
| >₹25–₹50 crore | 35% | ₹7 crore |
| >₹50–₹125 crore | 25% | ₹15 crore |
| >₹125–₹200 crore | 25% | ₹25 crore |
Secondary/Tertiary processing
| Investment slab | Subsidy | Cap |
|---|---|---|
| Up to ₹1 crore | 45% | ₹45 lakh |
| >₹1–₹2.5 crore | 45% | ₹1 crore |
| >₹2.5–₹10 crore | 45% | ₹4.5 crore |
| >₹10–₹25 crore | 45% | ₹7 crore |
| >₹25–₹50 crore | 45% | ₹8 crore |
| >₹50–₹125 crore | 25% | ₹15 crore |
| >₹125–₹200 crore | 25% | ₹25 crore |
For eligible expansion projects, the policy provides a separate technology-upgradation incentive.
General structure
| Investment slab | Subsidy | Maximum |
|---|---|---|
| Up to ₹1 crore | 20% FCI | ₹20 lakh |
| >₹1–₹2.5 crore | 20% | ₹40 lakh |
| >₹2.5–₹10 crore | 20% | ₹1 crore |
| >₹10–₹25 crore | 20% | ₹4 crore |
| >₹25–₹50 crore | 20% | ₹5 crore |
| >₹50–₹125 crore | 10% | ₹10 crore |
| >₹125–₹200 crore | 10% | ₹20 crore |
The policy encourages conversion of food waste into useful products such as:
General incentive
| Investment slab | Subsidy | Maximum |
|---|---|---|
| Up to ₹1 crore | 25% FCI | ₹25 lakh |
| >₹1–₹2.5 crore | 25% | ₹60 lakh |
| >₹2.5–₹10 crore | 25% | ₹2.5 crore |
| >₹10–₹25 crore | 25% | ₹3.5 crore |
| >₹25–₹50 crore | 25% | ₹5 crore |
| >₹50–₹125 crore | 25% | ₹5 crore |
| >₹125–₹200 crore | 25% | ₹5 crore |
FPOs/SHGs/Federations/Cooperatives/Societies can receive higher applicable category benefits, and the incentive is available for new as well as expansion projects.
For eligible projects involving:
the policy provides a 35% FCI subsidy for applicable categories, with caps varying by investment slab.
The amended structure reaches up to:
depending on the investment slab.
FPOs/SHGs/Federations/Cooperatives/Societies receive higher applicable benefits in the relevant investment category.
The policy encourages establishment/upgradation of NABL-approved full-fledged food-testing laboratories, including antibiotic testing.
Benefit
35% of FCI towards:
Maximum
₹5 crore
Eligible projects
The eligible incentive is disbursed in two equal annual instalments after generation of the first tax invoice.
General enterprises
| Category | Subsidy | Period | Annual cap |
|---|---|---|---|
| Micro | ₹1/unit | 6 years from DCP | ₹1 lakh |
| Small | ₹1/unit | 6 years | ₹5 lakh |
| Medium | ₹1/unit | 6 years | ₹15 lakh |
| Large | ₹1/unit | 2 years | No specific cap stated in original table |
Special-category enterprises
The February 2025 amendment provides enhanced power support:
₹1.50 per unit for 5 years from DCP, with applicable annual caps depending on the investment slab/category. The amended table includes caps ranging from ₹1 lakh to ₹15 lakh per annum.
This is another major recurring financial benefit.
MSME / FPO / SHG / Federation / Cooperative / Society
100% of eligible net SGST on sale of final products manufactured, sold and registered in Andhra Pradesh.
Period
6 years from commercial production under the original policy.
Annual ceiling
5% of annual turnover.
Large units
100% net SGST reimbursement for 5 years from commercial production, subject to the 5% of annual turnover ceiling.
The amended framework adjusts the applicable period/slabs for the revised classification, so the exact claim period should be checked against the investment date and applicable category.
Eligible MSMEs can receive:
Audit cost
75% of audit cost
Maximum
Equipment recommended by audit
25% of eligible equipment cost, with caps:
| Enterprise | Maximum |
|---|---|
| Micro | ₹20 lakh |
| Small | ₹40 lakh |
| Medium | ₹50 lakh |
| Category | Benefit |
|---|---|
| Micro | ₹5,000/person, maximum 10 persons |
| Small | ₹10,000/person, maximum 20 persons |
| Medium | 100% employer EPF contribution, capped at ₹1 lakh/year for 3 years |
The policy also envisages technical training through institutions such as ICAR, CFTRI, IIMR, NIN, CIPET and NIFTEM, along with OJT and food-safety training.
For eligible exporting units in selected sectors:
| Enterprise | Benefit |
|---|---|
| Micro | 1% of annual turnover for 3 years; overall cap ₹15 lakh |
| Small | 1% of annual turnover for 3 years; overall cap ₹1.5 crore |
| Medium | 1% of annual turnover for 3 years; annual cap ₹7 crore |
The objective is to encourage domestic sourcing of raw materials.
The policy provides support for certifications such as:
The State provides reimbursement of the balance amount required to cover 100% of eligible certification cost after Government of India assistance, subject to the applicable conditions.
The policy establishes a ₹250 crore State corpus for areas including:
The policy is not limited to direct subsidies.
It proposes/supports:
Focused Food Parks
With facilities such as:
Nano Food Parks
The policy proposes nano food parks of less than 10 acres, aimed at micro food enterprises, with common facilities such as:
Large Food Parks
The policy envisages 26 large parks, while also proposing 77 MSME parks and 175 Nano Food Parks, subject to implementation.
The policy proposes four food export hubs, each planned at more than 500 acres, focused on:
These hubs are intended to facilitate exports rather than function primarily as production/processing sites.
The policy encourages investment in:
The objective is to reduce post-harvest losses and maintain quality from farm to market.
The policy also supports irradiation infrastructure through financial incentives and PPP models to improve:
Important conditions include:
Eligible investment and employment must relate to the agricultural/food-processing/allied activity undertaken in Andhra Pradesh.
The policy specifically distinguishes:
The enterprise generally needs to obtain Consent for Operation (CFO).
The unit must commence commercial production within the operative policy period, unless specifically exempted.
Several capital subsidies are disbursed based on the first tax invoice, with different eligible periods depending on the project category.
For specified capital subsidies, if a project is delayed beyond its committed completion date, the incentive can be reduced by 0.5% for each month of delay in DCP from the committed date stated in the application.
The policy expressly says that eligible applicants under FPP should not claim the same/similar incentive under the AP Industrial Development Policy or AP MSME Policy.
These two incentives are mutually exclusive.