People involved or keeping track of the changes that are taking place in the Indian food space don’t require studies and numbers to tell that the future sees a positive boom. But for those who have been out of touch with the food arena, a study predicts that the industry will see an 11% annual growth rate. This means that a projected worth of $65.4 billion (~INR 4,000 billion) is being anticipated by the year 2018.
A joint report by IIM-C and Academic Foundation states the current value of the industry to be $39.71 billion (~INR 2,500 billion). With food and grocery constituting a considerable amount of consumption, about 31%.
“In contrast, consumers in other countries spend a much lower proportion of their income on food and grocery.
“While US spends 9 per cent, Brazil and China spend 17 per cent and 25 per cent respectively on food and grocery, the report said. Food is also the largest segment in India’s retail sector, which was valued at $490 billion in 2013”, The Economic Times cites.
The country’s retail market will also see a jump from the current $490 billion evaluation to a whopping $865 billion in 2023, the sector’s contribution to the industry rising from 8% to 24%.
The report marks that India possibly owes this growth to the presence of foreign enterprises in the supply chain. These foreign businesses have invested in the country’s manufacturing process, in turn creating employment opportunities for the citizens.
“Some of the foreign firms have successfully established backward linkages and are working with farmers and contract manufacturers. These firms have contributed substantially to government revenues,” the report reads.
In addition to revenue generation and employment, foreign industries also have a substantial role to play in other areas such as product innovation, waste management, new environment-friendly technology and the Indian export system.