Hurdles for start-ups
BENGALURU
Government-assisted rural food start-ups under the PM Formalisation of Micro Food Processing Enterprises (PMFME) scheme in Karnataka are facing delays due to pending clearances from the Karnataka State Pollution Control Board (KSPCB). Banks are refusing loans to these units in the absence of mandatory Consent for Establishment (CFE) certificates, putting thousands of beneficiaries and potential jobs at risk just months before the financial year ends.
Agriculture Minister N Cheluvarayaswamy has urged KSPCB to exempt PMFME units from obtaining CFE certificates, citing minimal environmental impact and the urgent need to support rural entrepreneurs. In a letter to KSPCB Chairperson PM Narendraswamy, he highlighted that hundreds of applications are pending with banks, preventing disbursal of loans and threatening the state’s targets for 2025–26.
The Minister noted that the Chief Minister had earmarked Rs 206 crore to facilitate 5,000 micro food processing units across Karnataka. Each unit can generate 10–15 jobs, potentially creating 40,000–50,000 rural employment opportunities. Typical PMFME units include millet processing, ready-to-eat fruit and vegetable units, cold-pressed oil mills, bakeries, spice powder production, and pappad and pickle manufacturing.
Officials pointed out that CFE approvals from KSPCB typically take weeks to months, delaying operations and making units reliant solely on subsidies. The Minister suggested classifying these units under the ‘White Category,’ exempting them from both CFE and Consent for Operation (CFO) certificates to streamline support.
Karnataka has registered nearly 8,000 start-ups under PMFME over the past five years, attracting nearly Rs 1,000 crore in investments, including subsidies. KAPPEC, the nodal agency, oversees implementation. With 2025–26 being the final year of the scheme, the government aims to establish an additional 500 units with state assistance of Rs 206 crore, emphasizing rural employment generation, reduced migration, and better pricing for agricultural produce.
The exemption, if granted, will fast-track approvals, enable banks to release loans, and safeguard the livelihoods of thousands of rural entrepreneurs, ensuring that the PMFME scheme meets its full potential.
