Business Analysis
India is the world second largest producer of food next to China, and has the potential of being the biggest with the food and agricultural sector. The food processing industry is one of the largest industries in India-it is ranked fifth in terms of production, consumption, export and expected growth. Increasing incomes are always accompanied by a change in the food basket. The proportionate expenditure on cereals, pulses, edible oil, sugar, salt and spices declines as households climb the expenditure classes in urban India while the opposite happens in the case of milk and milk products, meat, egg and fish, fruits and beverages.
The figure above shows the consumption of food in India in USD billion over the years. The CAGR of food consumption over the years is 5.32%.
INDUSTRY GROWTH
The Confederation of Indian Industry (CII) has estimated that the foods processing sectors has the potential of attracting US$ 33 billion of investment in 10 years and generate employment of 9 million person-days. The Indian food processing industry stands at $135 billion and is estimated to grow with a CAGR of 10 per cent to reach $200 billion by 2015. The food processing industry contributed 7 per cent to GDP. The industry employs 13 million workers directly. Value addition of food products is expected to increase from the current 8 per cent to 35 per cent by the end of 2025. Fruit & vegetable processing, which is currently around 2 per cent of total production will increase to 25 per cent by 2025. The highest share of processed food is in the dairy sector, where 37 per cent of the total produce is processed, of this only 15 per cent is processed by the organized sector. The food processing industry in the country is on track to ensure profitability in the coming decades. The sector is expected to attract phenomenal investments of about Rs 1,400 billion in the next decade.
Processed Food Industry Growth Drivers:
⦁ Increased spending on healthy foods.
⦁ Increasing nuclear
The figure above shows the consumption of food in India in USD billion over the years. The CAGR of food consumption over the years is 5.32%.
INDUSTRY GROWTH
The Confederation of Indian Industry (CII) has estimated that the foods processing sectors has the potential of attracting US$ 33 billion of investment in 10 years and generate employment of 9 million person-days. The Indian food processing industry stands at $135 billion and is estimated to grow with a CAGR of 10 per cent to reach $200 billion by 2015. The food processing industry contributed 7 per cent to GDP. The industry employs 13 million workers directly. Value addition of food products is expected to increase from the current 8 per cent to 35 per cent by the end of 2025. Fruit & vegetable processing, which is currently around 2 per cent of total production will increase to 25 per cent by 2025. The highest share of processed food is in the dairy sector, where 37 per cent of the total produce is processed, of this only 15 per cent is processed by the organized sector. The food processing industry in the country is on track to ensure profitability in the coming decades. The sector is expected to attract phenomenal investments of about Rs 1,400 billion in the next decade.
Processed Food Industry Growth Drivers:
⦁ Increased spending on healthy foods.
⦁ Increasing nuclear