Recently published reports revealed that India’s food industry is expected to grow 11% annually, to achieve target of $65.4 billion (nearly Rs.4 lakh crore) by the year 2018. Presently industry is valued at $39.71 billion (Rs. 2476.8 crore), as suggested joint reports of IIM-Calcutta and Academic Foundation.
The report added that “Food and grocery constitute a substantial part of India’s consumption accounting for around 31 per cent of the consumption basket.”
In contrast, US spends 9 per cent, Brazil and China 17 % and 25 % 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, whereas consumers in other countries spend a much lower proportion of their income on food and grocery.
The report further stated “India’s retail market is expected to grow to $865 billion by 2023, which is presently valued at $490 billion.” The proportion of modern retail is expected to grow to 24 per cent of the total retail market from 8 per cent currently, it added.
The reports suggests that Indian market is may be benefitted with the presence of foreign businesses in food supply chain.
The also report observed that “Several foreign companies have invested through manufacturing in India, leading to employment creation.”
It also added that “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.”
There are also some additional benefits from the presence of international businesses, such as implementation of waste management, environment-friendly technologies, product innovation and exports from India, the report said.
