How much does it cost to start a rice mill business in India?

A government sample project report estimates the cost of a 1 TPH rice mill at approximately Rs 80 lakh, including Rs 55 lakh for plant and machinery and initial working capital. Land, construction and parboiling equipment can increase the total investment.

Is a rice mill business profitable in India?

Yes. A rice mill can be profitable when it operates at sufficient capacity, maintains a good rice-recovery rate and generates additional income from bran, husk and broken rice. A government sample project report estimates profit on sales at approximately 8.5% to 15.4%.

Which licences are required for a rice mill?

A rice mill typically requires FSSAI approval, GST registration, Udyam registration, pollution-control consent, a dedicated power connection and an NOC from the local authority. A factory licence, mandi trader licence and Legal Metrology registration may also be required.

How much rice is produced from paddy?

A government sample project report assumes a net rice realisation of approximately 67% of the paddy weight. The remaining material becomes husk, bran, broken rice and processing losses.

Is there a subsidy for starting a rice mill?

Yes. Eligible rice mill projects may receive support through schemes such as PMFME, PMEGP, the Agriculture Infrastructure Fund, PM Kisan Sampada Yojana and applicable state food-processing policies.

When is the best time to start a rice mill?

The rice mill should ideally be ready before the main kharif paddy harvest. Planning construction and approvals early helps the unit begin operations when paddy availability is highest.

How to Start a Rice Mill Business in India (2026 Guide)

By Arjun N|October 22, 2026|10 min read

Key Takeaways

Choose the rice mill capacity according to the paddy supply available nearby, buyer demand and working-capital capacity.
A 1 TPH rice mill may require an investment of around ₹80 lakh, including machinery and initial working capital.
The main machinery includes a pre-cleaner, destoner, husker, separator, whitener, polisher, grader and packing system.
Essential approvals generally include FSSAI, GST, Udyam registration, pollution-control consent, local NOC and a suitable three-phase power connection.
Profitability depends on rice recovery, plant utilisation, paddy prices and additional income from bran, husk and broken rice.

Arjun N

Founder & CEO, SolutionBuggy

Arjun N spent a decade in manufacturing and industrial engineering before founding SolutionBuggy in 2016. Today, SolutionBuggy connects 60,000+ registered MSMEs with 12,000+ verified manufacturing consultants across India, with 3,500+ completed projects and a 4.5 client satisfaction rating.

FOUNDER & CEO