State industries secretary M Bhave picked three of the six sectors as most crucial to Maharashtra. These were food processing and packaging, software and other services and electronics and information technology. The other sectors being chemical and plastics processing, environmental technology and light engineering.

In the first of a series, Enterprise will focus on food processing. But before that here is a snapshot of the EU: Formerly called the European Community,the European Union as it is now known comprises of Austria, Belgium, Denmark, finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden and United Kingdom. The world's largest economy (1997 GDP Rs 29,855 thousand crores), it is also the world's largest trading block and India's largest trading partner, accounting for one-fourth of its total trade.

The EU has the world's largest food processing industry and exports seven percent of production. Over 92 percent of the enterprises in the sector are SMEs with less than 20 employees and six percent with between 20 to 99 people each. Altogether SMEs account for 30 percent of value of production. Germany, France and Italy lead in fruit and vegetable processing, the first two lead in meat producing, UK for poultry and Spain in the fish and seafood sector. Soft drinks and mineral waters are significant in the beverages sector, with Germany, Italy and France again as leading producers. Where dairy products are concerned, the EUhas been the world's largest producer, main consumer and exporter. Milk and resh products are mostly traded at intra-EU level and consumption but the introduction of quota systems for milk production has resulted in many merging activities.

Over the decade, traditional consumption patterns in the EU have diversified and lifestyles have become more homogeneous, the demand for a variety of food and more market segments have increased. Supply and competition have led to adoption of labour saving technologies and improvement in distribution. Interestingly, distributors are squeezing producers' margins and launching their own labels.

The industry is still relatively labour intensive and automation is not as strong as in other sectors but the use of technology in the production process is on the rise. For instance, mechanical harvesting was introduced for tomato-based products, while innovations in the production of fruit for syrup or juices have veered towards shorter production times. For meat, fish andpoultry products, most producing firms consider vacuum as the most advanced in terms of transport and production preservation.

Individual quick freezing is a well established preservation technique for frozen seafood in small quantities and vacuum packs and microwave pasteurisation are used to extend shelf-live for upto three weeks without freezing. As for beverages, polyethylene has replaced glass which now has only a 10 percent share in packaging. However, Germany is encouraging the use of returnable glass to address ecological concerns.

Manyenvironmental concerns regarding the dairy industry are linked to upstream activities such ax animal farming and pollution of water beds.The information extract says that in the final part of the distribution chain, concerns are also shown for the huge quantity of plastic-based packaging materials used for final products. Most industries prefer to use environmental-friendly and recyclable material.

Additional EU imports in fruit and vegetable processing come frommany countries, particularly those where labour costs are low and which are located close to the EU. International competition on the EU processed seafood market is intense, with raw material availability and cost as major competitive variables. Leading EU seafood processing companies are increasingly opting for joint ventures in third countries for supply and leverage.

As for beverages, all national markets in the EU show a progressive growth in consumption (of soft drinks, concentrates, fruit drinks, tonics, bitters, carbonated drinks and iced tea).

Itmay be recalled (see Enterprise July 6), the EU-IndiaPartenariat `99 secretariat will be shortlisting 400 firms from India to participate in the meet in Delhi where 400companies will be visiting from the EU member countries to explore avenues of cooperation such as joint ventures, franchises, financial cooperation, etc. The last date for sending in applications for selection is July 17.