§1What this business is
Onions are peeled, ground, fried and cooked in an autoclave steam cooker, then sterilised and packed. Hotels, caterers and busy households use the paste to save time in curries. The KVIC profile calls the technology simple.
Capacity: 193 quintals of onion paste a year (₹5.80 lakh at cost of production).
§2Is it right for you?
Who it is for
A household or self-help group near onion-growing areas with links to hotels and caterers.
Who it is not for
Someone who cannot follow food-safety and hygiene rules strictly.
Advantages
- Very small investment
- Simple process and equipment
- Onion is used in almost every Indian curry
- Can start from a village shed
Drawbacks
- Onion prices swing sharply through the year
- Small turnover and income
- Shelf life depends on proper sterilising and packing
- Branded pastes compete in cities
Skills you need
- Cooking and sterilising to a fixed recipe
- Hygiene and FSSAI basics
- Buying onion at the right season
- Selling to HoReCa buyers
Why difficulty 2/5: Simple and cheap, but hygiene and onion buying need care.
§3Market
Who buys
- Hotels, restaurants and caterers
- Households
- Kirana and grocery shops
How it sells
- Direct supply to caterers and dhabas
- Local wholesalers
- Retail packs through kirana
Good to know
- The profile says onion paste has high market demand and simple technology.
§4Raw material & machinery
| Item | Qty | Cost |
|---|---|---|
| Frying pan | 1 | — |
| Autoclave steam cooker | 1 | — |
| Diesel bhatti (furnace) | 1 | — |
| Sterilisation tank | 1 | — |
| Small utensils, mugs, cups and balance | 1 set | — |
| All equipment together (KVIC total) | 1 lot | ₹1,75,000 |
From: KVIC Project Profile — Onion Paste Manufacturing Scheme (PMEGP)
- Onionsraw material ₹1.00 lakh a year in the profile
- Labels and packing material₹1.00 lakh a year
From: KVIC Project Profile — Onion Paste Manufacturing Scheme (PMEGP)
In our raw material database
§5Licences & registration
- FSSAI registration or licence
- Udyam registration
- GST registration
- Legal Metrology packaged-commodity registration (for packed goods)
§6Schemes & subsidies
- PMEGPCentralActive15–35% subsidy
- PMFMECentralUnclear35% subsidy, up to ₹10 lakh
- MudraCentralActiveLoan up to ₹20 lakh, no collateral
- CM YUVAUPActiveUp to ₹5 lakh, interest-free
PMEGP (the profile was made for it), PMFME for micro food processors, MUDRA Shishu or Kishor, and CM-YUVA in UP as the project is under ₹5 lakh.
§7Money
How the investment is worked out: KVIC profile: shed 500 sq ft ₹1.00 L + equipment ₹1.75 L (frying pan, autoclave steam cooker, diesel bhatti, sterilisation tank, utensils, balance) + working capital ₹1.44 L = ₹4.19 L. Land own.
Working capital: Working capital ₹1.44 lakh; raw material ₹1.00 lakh and labels and packing ₹1.00 lakh a year.
Year not printed on the KVIC profile — check current machinery prices.
§8Export potential
Confirm the HS code in the DGFT ITC(HS) lookup before you export
Export council / board: APEDA
- HS heading from the ITC(HS) 2022 schedule; confirm the 8-digit line with DGFT or your customs broker.
- You need an Import Export Code (IEC) from DGFT before the first shipment.
§9Risks — where people fail
- Onion price spikes
- Spoilage from poor sealing
- Food-safety complaints
- Low volume if buyers are few
§1030 / 60 / 90-day plan
A general plan that applies to any business. A plan for this business will be added after research.
- Days 1–30: Visit a working onion paste making unit, ask 10 buyers about price and quantity, and get quotations from 3 suppliers.
- Days 31–60: Udyam and the licences you need (FSSAI registration or licence, Udyam registration), a project report (DPR), and the scheme or loan file.
- Days 61–90: Space and machines, trial production, and first deliveries to 10 customers.
§11Who to connect with
Associations, clusters and training institutes — the directory is being built. Connect
§12Watch
There is no episode on this business yet. Shows are coming soon on the Podcast page.
Want to start Onion Paste Making?
DPR, loan file or registration — ask us on WhatsApp.
¶Sources
Data review: 6 October 2026. Spotted a mistake? Report it. For information only — not legal or financial advice.