There has been diversification of Indian diets away from foodgrains to high value products like milk, meat products, vegetables and fruits. Food-processing industry has been registering good growth since the past few decades and particularly after nineties. The conditions are now ideal for the growth of this industry. The central government has taken some steps to deregulate and encourage the sector after 1991. However, the role of states is vital. The government of Andhra Pradesh released a policy in November 2003. There are no major initiatives in the policy and still can be called a good beginning. As against the robust growth at the All-India level, the growth rate in net value - added in the nineties was almost the same as that in the eighties in the state.