New Delhi, Dec 28 (KNN) In the backdrop of the kisan andolan (farmers protest), India and United Arab Emirates (UAE) have signed an ambitious agreement through which UAE will invest 7 billion dollars in a food processing complex in India.

As per the Gulf News, Eight food processing units to be set up in Madhya Pradesh (MP) which will purchase food grains, fruits and vegetables directly from 22 lakh farmers in Madhya Pradesh (MP), Uttar Pradesh (UP) and Gujarat. The high end, value added products will be exported to the UAE and other Middle East countries through an exclusive food corridor.

The project will involve contract farming on a large scale and will be implemented by Indians both within India, and working in UAE.

This will also extend to managing the food supply chains. For instance, DP World is exploring “synergies” for offering integrated supply chain solutions, while DMCC’s (Dubai Multi Commodities Centre) has an agriculture trading platform - ‘Agriota’ - inking farmers in India with food companies in the UAE in an effort to boost food imports from India.

According to the Gulf News this was confirmed by Juma Al Kait, Assistant Undersecretary - Foreign Trade Affairs at UAE’s Ministry of Economy at the India-UAE Food Summit in Dubai.

Last year, it was announced that UAE entities would invest up to 7 billion dollars (Dh25 billion) in India’s food sector over three years as part of the UAE-India food corridor project that aims to secure the Gulf country’s food security needs. The corridor is expected to benefit 2 million Indian farmers and create an additional 200,000 jobs through the establishment of logistics infrastructure and agricultural projects.

“Considering our strategic relationship, I strongly believe that this is a very opportune time for UAE and India to escalate food security cooperation,” Gulf News quoted Ahmed Al Banna, UAE’s Ambassador to India as saying.

“I congratulate the Indian government for the recently introduced production linked incentives scheme, and the ten key sectors approved by the Indian Union Cabinet,” he added.

The Gulf News in its report further mentioned that India’s Production Linked Incentive (PLI) scheme would give firms incentives on incremental sales from products manufactured at manufacturing and processing units in the country.