India's Food Vision of the Next Decade

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India’s Food Vision: The Next Decade
Introduction Demand Drivers Key Opportunities Key Challenges The Outlook for Future 73 73 76 77 78

perspective | Volume 04
a quar terly repor t by Vol u me 0 4 / 2 0 1 0

Introduction
According to the International Monetary Fund (IMF), India’s economy is projected to grow at 8.8 percent in 2010 as the demand is estimated to improve on the back of the Government of India’s economic stimulus policies and other contributory factors such as the estimated normal arrival of the monsoon. Increased supply and stock replenishment and easing of inflationary pressures will mean that the demand for food products would increase. However, this increased and rejuvenated demand makes it pertinent to align India’s national policy with respect to agriculture and food in order to satisfy the demand arising out of an ever-increasing population that is highly discerning of quality and taste and has little time in a busy lifestyle for traditional cooking techniques. Corporates can look into the relevance and impact of the foregoing factors to their businesses and the kind of offerings that they need to develop in the emerging scenario.

Demand Drivers
The key factors that have enormous importance in increasing demand for food and are expected to play a major role in the transformation of the demand are: •Rising population and incomes •Increasing number of nuclear families and working women •Palate and lifestyle changes The above factors are likely to impact demand for food individually as well as in combination, and result in significant changes in not only the demand for food quantitatively but also in terms of where, how, what and when food is consumed. This is likely to translate to new and unprecedented modes of delivery mechanisms, retailing formats, packaging formulations and a range of convenience and ready-to-eat food products.

Rising Population and Incomes
India’s population, by the coming decade, is estimated to be 1.3 billion out of which the predominant numbers – ~60 per cent – are expected to fall in the age group below 40 years, making it a demanding segment to cater to. In addition, with real per capita incomes likely to nearly double in the next 10 years and more than two-thirds of the current population still just above or below the poverty line, the first category to see increased spending will be food. The increase in population combined with the increase in the disposable income will translate into not only the likely increase in demand in value-added sectors such as meat, dairy, fresh vegetables and fruits but also an accelerated demand for primary food products. This demand will graduate into an exponential demand for primary commodities, deriving partly from the fact that it takes greater quantities of primary food to get processed and aggregated into a value-added product. On top of this requirement for accelerated Exhibit 1: usage or absorption of primary commodities or Crop Productivity Levels - A Comparison (MT/ha) food conversion from raw to processed form, the Crops India Other Countries consumption demand for basic commodities would Paddy 3.03 9.71 also increase with the growing population. Wheat 2.69 0.60 0.25 60.70 8.89 5.14 4.29 122.70

The net effect of this would be the combined demand for both primary and value-added food products from the same natural resource region or even smaller in size than it exists today. This necessitates policy making and research efforts towards areas

Pulses Edible Oilseeds Sugarcane

F&V: Fruits & Vegetables Source: Ministry of Food Processing Industries, Government of India

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| India’s Food Vision: The Next Decade

perspective | Volume 04
a quar terly repor t by Vo l u m e 0 4 / 2 0 1 0

that focus on increasing the productivity of crops, increasing water-usage efficiencies, dryland farming and high yielding yet non-lodging strains of crop varieties. It is important that such initiatives are taken in...
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