Foreign direct investment (FDI) in India's food sector is about to touch the US$3bn level, with another US$55m invested in sugar and cooking oil companies. FDI in food already outdoes the FDI in the hotels and tourism industry, reports www.kamcity.com , quoting The Economic Times.

Latest industry data show that the cumulative FDI in food processing reached US$2.8bn in March, and this segment now has an almost 4% share of the total FDI approved by the government. The Indian government has approved 105 proposals between January 2002 and May 2005 from foreign companies to set up food processing units in India. The cumulative FDI in hotels and tourism by March was $1.37bn.

The report says industry estimates claim the sector needs investment of about $28-35bn to meet the changing food demands in India. The Indian Credit Rating Agency (ICRA) says the country's processed food market accounts for 32% of the entire food market.

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