How to Start an Organic Food Business in India

Tanya Verma

10 Feb, 2021

The organic food business is a very profitable business idea. If you wish to start an organic food business, you would need various licenses and permissions from multiple regulatory bodies, responsible for making laws and regulations for the food and associated sectors. In this blog, you would get to know all the information you would need to start your own organic food business.

Introduction to Organic Food Business

Organic Food Business is a type of business dealing with selling, purchasing, labeling, etc. of organic food products. Organic food, as defined by Section 22 of the Food Safety and Standardization Act, 2006, means the food products which are produced in accordance with the specified standards for organic production.

What does Section 22 of the FSS Act Specify?

Section 22 of the Food Safety and Standardization Act, 2006 gives regulations for “Genetically modified foods, organic foods, functional foods, proprietary foods, etc.” It specifies that no person or entity is allowed to sell, distribute, manufacture, import any novel foods, genetically modified foods, organic foods, functional foods, irradiated foods, foods for particular dietary uses, nutraceuticals, health supplements, or any other such food articles as notified by the Central Government.

Government bodies involved in Providing Permissions to Organic Food Businesses

The Food Safety and Standards Authority of India keep an eye on the organic businesses and ensure that these businesses get the two systems of certification. Namely, the Participatory Guarantee System {PGS} provided by the Ministry of Agriculture and Farmers Welfare and the National Program for Organic Production {NPOP} supplied by the Ministry of Commerce and Industry. These two certification systems are supervised under the Food Safety and Standards {Organic Food} Regulations by the FSSAI.

The Participatory Guarantee System or PGS is an internationally recognized organic quality assurance such as the ISO 9000, which is implemented and controlled by the committed organic farmer/producers by active participation with the consumers, in a process which is based on absolute trust. In other words, we can say that PGS is a certification scheme for organic foods.

National Program for Organic Production is a certification scheme for organic farmers. It was initiated to assist the organic farmers in flourishing in both the domestic and the international markets.

Labeling of Organic Foods

It is mandatory for every organic product to contain the India Organic Certificate on all of its outer packaging.  The entity should voluntarily get the India Organic logo for their products. As per the Food Safety and Standards {Packaging and Labelling} Regulations, 2011, the contents of labels of the food product should be as follows;

• Name of the food product, ingredients & their nutritional values
• Any food additives included in the food product
• Whether the food product is veg/non-veg
• Net quantity
• Lot no./ code no./ batch no.
• Date of manufacture
• Date of expiry
• Instructions to use {If applicable}

Documents needed to Start an Organic Food Business in India

Organic food businesses in India get the following type of food license from the FSSAI that is valid for five years:

• FSSAI Registration for companies having turnover less than Rs. 12 lakhs
• FSSAI State license for businesses having turnover more than Rs. 12 lakhs
• FSSAI Central license for businesses having a turnover exceeding Rs. 20 crores

Such food businesses need to take state license from their respective state governments. Also, they need permissions from the health departments.

The following documents are needed to apply for the food license;

• Any of these ID proofs:
  • PAN Card
  • Aadhar Card
  • Voter ID Card
  • Ration Card
• Business Agreement
• Memorandum of Association
• Articles of Association
• No Objection Certificate {NOC}
• Bank statements

As per the new laws for selling of organic products, it is mandatory for entities to get the following certifications also;

• National Program for Organic Production { NPOP }
• Participatory Guarantee System of India { PGS India}

Government Initiatives to Promote Growth of Organic Food Business in India

The following initiatives are taken by the Government of India to promote and help flourish the organic sector;

• The Government of India formulated the Participatory Guarantee System to give subsidies to small farmers backed by the Pradhan Mantri Kaushal Vikash Yojana Scheme{PKVY}
• In 2017, the government launched the Jaivik Bharat logo and the India Organic Integrity Database Portal to help organic farmers and associated food businesses
• The FSSAI also have relaxed certification norms for individuals and organizations having an annual income of less than 12 lakhs to promote organic farming
• Also, the government has stated that the organizations having turnover less than Rs. Fifty lakhs to sell organic food products without getting certification from NPOP/ PGS India. However, such organizations won’t be allowed to use the Jaivik Bharat^[1] logo

Growth in the Organic Food Industry in India

The organic food sector is growing at an astounding rate in the Indian market. As people are getting educated and hence, more health-conscious, it is expected for the organic food industry to grow by 25% in the coming three years. The advancement in technology and various other such factors ensures the achievement of this growth rate. Moreover, the government is also taking various initiatives to help improve this sector and generate awareness.

Top 8 organic startups in India

The top eight organic startups in India are as follows;

• Organic Shop: Founded by Manuj Terapanthi
• Naturally Yours: Founded by Priya Prakash and Vinod Kumar in 2010
• NutriBucket: provides 100% organic products available on their online food store
• I Say Organic: Ideal platform for farmers as it also takes care of the farmer’s well being. Founded by Ashmeet Kapoor
• Organic Life: established by Mallesh Tigali, and it caters more than 1500 organic products in 100 plus categories
• Farm2Kitchen: Founded by Seema Dholi in February 2011. It delivers organic food products to consumer’s doorsteps
• JoyByNature: Founded by Rahul Kumar and Sailesh Mehta. This platform sells around 50 brand products sold by over 300 vendors
• Living Greens Organics: Founded by Prateek Tiwari. This platform sells products grown on rooftops and promotes  rooftop farming

To Conclude

The organic food business is an industry which holds a lot of scope of growth in various ways, such as employing numerous ways if supplied with proper funding. Moreover, with the development of organic farming, consumers will be able to consume healthier foods and stay healthier.