Guidelines for Establishment of Incubation Center under PMFME Scheme

1. Background
Establishment of Incubation Center based on One District One Product (ODOP) is
one of the important components of PMFME Scheme. The scheme envisages providing credit
support to 2 lakh existing unorganized micro-food processing enterprises. Through this
scheme the micro entrepreneurs/SHGs/FPOs/Cooperatives and groups can utilize this
Incubation Center to manufacture their products without capital investment. In addition, this
Incubation Center will be utilized to provide training and skill upgradation support to the
beneficiaries.

1.2 The raw materials will be converted into finished product by utilizing the primary/
secondary/Tertiary processing and auxiliary units that will be set up at this Incubation Center.
This facility aids in overcoming the financial burdens on capital investment of start-ups and
also supports the existing entrepreneurs to venture into product extension lines. In short, this
facility renders machinery support required for conversion of produce from farm to fork.

2. Objectives
 To support establishment of Incubation Center for ODOP and other products
 To utilize the Incubation Center on commercial basis
 To provide training to beneficiaries (micro entrepreneurs/ SHGs/FPOs/Cooperatives
and groups) through Incubation Centers at the training rates prescribed under PMFME
Scheme based on National Skill Framework

3. Salient features of Incubation Center

The scheme under its Incubation Center would provide the following support
i. Primary processing facility like cleaning, grading and packaging of raw
produce
ii. Secondary processing facilities like milling, flaking, minimal processing,
thermal processing, brining and so on
iii. Tertiary processing like processing of Ready to eat, Ready to serve, Ready to
cook and so on
iv. Cold storage facilities to store their fresh and processed produce
v. Re-packing of foods

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 vi. Supports product extension lines

4. Components of schemes
As per the main PMFME scheme, One District One Product (ODOP) approach is
adopted in order to reap the benefit of scale in terms of procurement of inputs, availing
common services and marketing of products. Based on the baseline study, the state
governments have identified a food product for a district, keeping in view of the scheme on
perishables, cereal based product or a food product widely produced in a district and their
allied sectors. Shortlisted ODOPs from the state government have been pooled together and
the food produce has been grouped into 11 categories as given below including minor forest
produce for tribal districts.
• Food products based on Food Grains (Rice, Wheat & Pulses)
• Oil seeds based products
• Millets based products
• Fruits based products
• Vegetables & Tuber Crops related products
• Fish and marine products
• Meat/Poultry products
• Dairy products
• Spice products
• Plantation crops based products (including coconut and sugar cane)
• Minor forest produce (targeting the tribal population)

4.1Incubation Center
Incubation Center shall be the processing cum incubation facility based on ODOP
along with 2-4 allied product lines. The Incubation Center should have a minimum three
processing lines and maximum five processing lines to be funded from PMFME
Scheme. The Incubation Center will be made available for the end users on custom hiring
basis for startups and smaller food processing units. But it should run on commercial basis for
full utilization of installed capacity. The Incubation Center shall have the complete
processing lines as per the standard norms. The space/area for any Incubation Centers should
be minimum 7000 Sq. ft.

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4.2 Host Institute
The identified institutes where the Incubation Center to be established is named as
Host Institute. Any government owned institutions or govt. funded autonomous Institutions
such as technical colleges, universities, other professional institutes, R&D institutes or any
private institutions/agencies shall be the host institute. The concerned state government/nodal
agency shall identify the host institute and location for establishing the Incubation Center.
The institutes which is having existing building shall be given preference for hosting
Incubation Center.

4.3 Cost norms for setting up Incubation Center

Each selected host institute will be funded for the following to establish the Incubation Center
Sl No Processing Cost ( in Rs. lakh)
3-5 processing lines (capacity: 1-2 tonnes/day) for 200
ODOP and allied produce –should include primary,
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secondary and tertiary processing, raw material/finished
product storage, packaging.
Flooring, minor renovation of existing building, 50
2 electrical connections and other auxiliary units like
boilers, RO plant, ETP etc.
Building with minimum 7000 sq. ft (to be provided by -
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host institute)*
Food Testing Lab – If the host institute is not having the 25
4 in house testing facility, can propose the basic equipment
for proximate analysis and microbial load analysis**.
Total 275
*The institute with existing building/space shall be given preference for the grant support.
**Basic equipment required for food testing lab
S No Equipment Approximate cost
(in Rs. Lakh)
1 Hot air oven 1.5
2 Soxhlet apparatus 2.5
3 Protein – Kjeldhal apparatus 7.5
4 Fibre analyzer 5.5
5 Muffle furnace- ash content 2.0

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 6 Weighing balance 1.0
7 Microbial load analysis- laminar flow chamber, 4.0
autoclave and incubator etc.
8 Refractometers, pH meter, Gun thermometer, 1.0
glassware etc.
Total 25.0

4.4 Special grant in aid support to host institutes for civil works
As a special case, if the host institute does not have building infrastructure for
Incubation Center shall be supported by PM FME Scheme with grant of Rs.1.0 crore (Rupees
One crore only)for construction of buildings.

4.5 Funding details

Allocation of fund shall follow the below norms
Government Private Agency in Tribal Areas,
Private Agency
Institute/Organization NE States and SC/ ST category
100 percent of funding will 50 percent of funding will 60 percent of funding will
be provided from PMFME be provided from PMFME be provided from PMFME
scheme scheme and balance from scheme and balance from
private agency the private agency

4.6 Role of host institute

• The selected host institute is responsible to arrange required land, building and other
basic amenities like water, electricity, etc.
• The host institute is responsible for establishment of Incubation Centre with the
processing line as per the cost norms and relevant guidelines of PM-FME scheme
within one year from the date of sanction.
• Once the Incubation Center is set up, the common incubation facilities shall be leased
out to an O&M operator through a transparent process. The O&M operator should
operate the Incubation Center on commercial basis. The O&M operator would charge
for using the services of the Incubation Center from the micro enterprises and for
training. The bidding criteria should be the maximum rates to be charged from micro
enterprises for using the services of the Incubation Center and training. Maintenance
of Incubation Center including the machinery shall be the responsibility of O&M

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 operator. It shall be ensured by the host institution that the Incubation Center is
utilized by a large number of micro enterprises and for all the trainings under PMFME
and other State and Central Government Schemes. Any micro enterprise should be
able to use the services of the Incubation Center if they are willing to pay for the
charges.
• A monitoring and advisory committee shall be constituted by the Host Institute (HI)
with a representative from mentor institution for continuous monitoring of the
operations to ensure effective implementation of the scheme.

4.7 Mentor Institution

States should select one of the CSIR/ICAR or other research institutions as mentor
institution for each Incubation Center. The role of the mentor institution would be as
follow:
• Continuous monitoring of the implementation and establishment of Incubation Center
at host institutes.
• Providing technical support to host institutes at the stage of establishment as well as
running the Incubation Center.

4.8 Application procedure

Detailed project report (DPR) which should contain the following particulars:

 Host institution details like experience in food processing, technical manpower

available, details of land and building, suitability of the proposed building to house
the incubation centre.
 Details of proposed location for establishing the incubation centre: The location
should preferably be at places where there is likelihood of micro enterprises to come
and get their goods processed, It should not be inside any Agricultural
University/research centre located away from a city and highway. Also can be at a
location of farm produce in case of perishables and nearness to city market in case of
goods produced for local market. Specify how accessible is the location to micro
enterprises to come with raw material and depart with finished goods - distance from
road, highway, city, etc.
 Details of the proposed incubation centre
o Proposed processing lines

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 o Cost break up of each line (with machinery details, space requirement,
cost of individual machines, capacity etc.)
o Details of auxiliary units required, waste utilization plan from the
centre
o Justification for choosing each line based on local production of raw
material for perishables, market for finished goods, nearness to market/
cities
o Expected demand for common processing and training
 Cost break up of upgradation civil and electrical works required
 Details of testing equipment required if any for food testing lab
 Details of cost break up in case of private agency (agency contribution details)
 Recommendation of SLTI and SLAC
 A feasibility report on the proposed incubation centre.

4.9 Interested Institutes/agency should apply along with DPR to the State Nodal Agency.

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