Economic Viability and Financial Feasibility of Secondary Processing Unit of Turmeric in Chamarajanagar District of Karnataka, India

Abstract

Turmeric is an important commercial crop with both domestic and international demand facing challenges due to the absence of organized processing units at production centres. Addressing this gap requires a thorough analysis of the economic viability and financial feasibility of establishing turmeric processing units to empower stakeholders and foster agricultural advancement in the study area. The study was conducted in Chamarajanagar district of Karnataka, by collecting primary data on establishment and annual processing costs and secondary data on market prices of turmeric rhizome and powder. Financial feasibility analysis revealed positive Net Present Value (NPV) of ₹1,714.36 lakh and ₹623.56 lakh, Benefit Cost Ratio (BCR) of 2.37 and 1.76, Internal Rate of Returns (IRR) of 76 and 57 per cent at current and constant market prices, respectively. The findings showed that the establishment of turmeric processing units are both economically viable and financially feasible. Emphasizing this potential through extension systems can empower farmers to maximize benefits through mechanized value addition. These insights provide valuable guidance for entrepreneurs, Farmers Producers Organizations, Self Help Groups and cooperatives facilitating informed decisions on establishing small-scale turmeric processing units.