Madhya Pradesh has been the main source of raw material to the processors of various herbs throughout the country whether based in Bangalore, Chennai, Delhi or Kolkata. Needless to say that today huge demand of Indian herbal industry is met out by the herbal collection centres of Madhya Pradesh situated at Shivpuri, Betul, Katni, Neemuch etc. These centres together meet about 40% demand of the country. The natural occurrence of most of the herbs blended with mass scale cultivation of many herbs has made Madhya Pradesh the herbal hub of the country. From being a raw material bowl of the herbal industr y, Madhya Pradesh is all set to become the main processing centre for several herbal products. Taking it as one of its thrust areas, the Government has taken several measures to invite investments in the her bal processing sector.


Madhya Pradesh has a lot to offer to the potential investors in the herbal sector.


  • • Of  the 131 agro  climatic  zones of the country, 11 fall in Madhya  Pradesh. It is a natural  habitat for over 50% of the herbs used in the pharma industry.
  • • Abundant availability of raw Herbs.
  • • Abundant land available for cultivation of various Herbs.
  • • Large scale cultivation  of a number of species has already been started which can further be increased to a mass scale, as there is plenty of fertile land available.
  • • Cheap land  available  for  Industrial Operations.
  • • Well connected by rail, road and air.
  • • Single window clearance system for Drug license.
  • • Preferential allotment of land in Industrial areas/growth centers.
  • • Trained staff/manpower available.
  • • Viable Herbal Processing Industries.

On the basis of raw material (cultivated as well as wild) available in the state, a number of herbal processing industries can be successfully started in the state. A few of these could be;


  1. • Aloe Vera gel extraction and spray dried powder manufacturing units.
  2. • Units to  produce extracts of  various Herbs.
  3. • Fractional distillation units for value addition in essential oils.
  4. • Various   Ayurvedic drugs formulation units.
  5. • Production of concentrates and extracts from flowers.
  6. • Production of food and vegetable colours and dyes.
  7. • Primary processing of raw Herbs.
  8. • Isabgol Dehusking units.
  9. • Herbal Cosmetics.
  10. • Units to make Perfumery Compounds.
  11. • Expeller units (production of Bio-diesel and Neem oil etc).


Special Package for Herbal Industry


Along with the many facilities and concessions  available to industries in the state, following special package will be available to the herbal industries.

In order to bring about qualitative improvement in the pharmaceutical industries, a unit can be reimbursed the fee paid by it on hiring technical services for getting the certificate for Good Manufacturing  Practices  (GMP) as per the norms laid down by the World Health Organization (WHO).  The  amount  of reimbursement would be 50% of the total fee with an upper  limit of Rs. 11 lakhs per project.


With the objective  of promoting export, small scale entrepreneurs  of the herbal industries will be given financial assistance to participate in the International Trade Fairs and Exhibitions.

Registration fee chargeable by the importing  industries  for  import of herbal products will be reimbursed to the extent of 25% by the State Government. This reimbursement  will be in addition  to the amount of reimbursement extended by the Central Government.

Since most of the Herbal and Ayurvedic Products  manufacturing  units are likely  to be located in advanced districts of the state like  Indore   and Bhopal etc.  Hence the Government  has decided to extend the facilities of interest subsidy, capital investment subsidy etc. in these districts as well.

These will  be similar  to the facilities applicable in case of backward districts In  respect  of the existing  and upcoming herbal parks, herbal and ayurvedic industries, the relevant provisions of the labour laws applicable in Special Economic Zones as declared by the State Government under its Notification No. F-28-38-01, 16B(i), B(ii), B(iii), B(iv),  B(v) dated  19.05.03 will be applicable.


Herbal and  Ayurvedic industries   will be exempted  from  applicable  stamp duty in case of change  in the name of firm, inclusion of partners, entering into collaborations, for reorganizations and for amendment  in the lease deed for  the next 3 years.  Similarly, these industries will be  exempted from stamp duty applicable in case of entering into agreement  with financial  institutions for getting financial assistance.

Special arrangements have been made for pharmaceutical  and herbal industries  for fast track clearance from  the  licensing authority as well as from other Departments.


Content Courtesy : MP Madhyam.