India's bakery industry - estimated to be worth $4.7 billion in 2010
and expected to touch the $7.6 billion-mark by 2015, according to a
report - is highly fragmented. The report added that it was the
third-highest revenue-earner among the processed food industry, and
biscuits contributed most significantly to the sector's growth.
While the organised bakery segment is one of the largest segments in the country's processed food industry in India, there is a segment of it which is unorganised. But its growth, in both the rural and urban markets, has been promising.
Moreover, when compared to the global baked goods market (which dipped during the meltdown and has been on the road to steady recovery), the Indian baked goods market has been recession-proof and grown significantly over the past few years.
“The factors fuelling market expansion in developing countries include convenience, affordability and the health benefits of baked goods. The demand for fortified baked products has also driven sales,” S Siddiqui, industry analyst, said.
Brown revolution
The word revolution has proved a boon to the Indian food industry. Since the advent of the Green, White, Yellow and Rainbow Revolutions, the country has become self-sufficient in the production of foodgrains, milk, pulses and fish, respectively.
Dhananjay Phaste, head of department, economics, G R Patil Group of Colleges, Mumbai, said, “The food processing industry is a sunrise industry in India. The country has the potential to become the world's food basket, but a Brown revolution – for the bakery and biscuit industry – is needed.”
“India’s food processing industry could bring our nation out of the ongoing crisis (characterised by rising inflation). All we need to do is ensure the optimum utilisation of the food we produce,” Phaste added.
Commenting on these crises, Arindam Chaudhuri, director, Indian Institute of Planning and Management (IIPM), and author, said, “More than half our population is engaged in the agriculture and manufacturing sectors, but our output is lower than those of other developing nations. We must pay attention to bringing maximum output from the manufacturing sector.”
According to report by Research and Markets, the present per capita consumption of bakery products is 1 or 2kg per annum. In the advanced countries, it ranges between 10 and 50kg per annum.
“The food processing ministry, and its array of departments, must bring to light the issues faced by the unorganised industry. On the one hand, it may be premature to expect a Brown Revolution, but on the other, it would not be incorrect to state that India is one of the fastest-growing among the developing countries and its rapidly-changing eating habits India could drive the demand for bakery and allied products,” said Siddiqui.
Old markets, new products
The baked goods industry, encompassing such products as bread, cereals, cakes, biscuits, pastries and scones, is well established in the industrialised nations of Europe and the United States. Product innovation, healthier products and ingredients are driving the sector's growth in these countries.
India is the ninth-largest economy in terms of nominal rate and the third-largest in terms of purchasing power parity. It also has formal diplomatic relations with most nations, and its neighbouring countries in particular. The growing international influence gives the country a prominent voice in global trade and commerce.
Jamaal Khan, who imports food and beverage chemicals and machinery from China and re-exports them, said, “Bakery products are short-lived in nature. The current infrastructural status of our country does not support us to export our bakery produce like cakes, muffins and bread to the West. The best way to start bakery export would be focussing South Asian Association of Regional Cooperation (SAARC) markets.”
“India’s organised bakery players can enhance their business by foraying into its neighbouring nations. If we observe market trends like the per capita consumption and standard of living of countries like Sri Lanka, Pakistan and Bangladesh, we would find that these markets have a plethora of opportunities for our bakery, biscuits and other processed food items,” Khan added.
However, SAARC nations face such problems as the lack of skilled manpower, unorganised nature of market, and power shortage, as is the case in India.
While the organised bakery segment is one of the largest segments in the country's processed food industry in India, there is a segment of it which is unorganised. But its growth, in both the rural and urban markets, has been promising.
Moreover, when compared to the global baked goods market (which dipped during the meltdown and has been on the road to steady recovery), the Indian baked goods market has been recession-proof and grown significantly over the past few years.
“The factors fuelling market expansion in developing countries include convenience, affordability and the health benefits of baked goods. The demand for fortified baked products has also driven sales,” S Siddiqui, industry analyst, said.
Brown revolution
The word revolution has proved a boon to the Indian food industry. Since the advent of the Green, White, Yellow and Rainbow Revolutions, the country has become self-sufficient in the production of foodgrains, milk, pulses and fish, respectively.
Dhananjay Phaste, head of department, economics, G R Patil Group of Colleges, Mumbai, said, “The food processing industry is a sunrise industry in India. The country has the potential to become the world's food basket, but a Brown revolution – for the bakery and biscuit industry – is needed.”
“India’s food processing industry could bring our nation out of the ongoing crisis (characterised by rising inflation). All we need to do is ensure the optimum utilisation of the food we produce,” Phaste added.
Commenting on these crises, Arindam Chaudhuri, director, Indian Institute of Planning and Management (IIPM), and author, said, “More than half our population is engaged in the agriculture and manufacturing sectors, but our output is lower than those of other developing nations. We must pay attention to bringing maximum output from the manufacturing sector.”
According to report by Research and Markets, the present per capita consumption of bakery products is 1 or 2kg per annum. In the advanced countries, it ranges between 10 and 50kg per annum.
“The food processing ministry, and its array of departments, must bring to light the issues faced by the unorganised industry. On the one hand, it may be premature to expect a Brown Revolution, but on the other, it would not be incorrect to state that India is one of the fastest-growing among the developing countries and its rapidly-changing eating habits India could drive the demand for bakery and allied products,” said Siddiqui.
Old markets, new products
The baked goods industry, encompassing such products as bread, cereals, cakes, biscuits, pastries and scones, is well established in the industrialised nations of Europe and the United States. Product innovation, healthier products and ingredients are driving the sector's growth in these countries.
India is the ninth-largest economy in terms of nominal rate and the third-largest in terms of purchasing power parity. It also has formal diplomatic relations with most nations, and its neighbouring countries in particular. The growing international influence gives the country a prominent voice in global trade and commerce.
Jamaal Khan, who imports food and beverage chemicals and machinery from China and re-exports them, said, “Bakery products are short-lived in nature. The current infrastructural status of our country does not support us to export our bakery produce like cakes, muffins and bread to the West. The best way to start bakery export would be focussing South Asian Association of Regional Cooperation (SAARC) markets.”
“India’s organised bakery players can enhance their business by foraying into its neighbouring nations. If we observe market trends like the per capita consumption and standard of living of countries like Sri Lanka, Pakistan and Bangladesh, we would find that these markets have a plethora of opportunities for our bakery, biscuits and other processed food items,” Khan added.
However, SAARC nations face such problems as the lack of skilled manpower, unorganised nature of market, and power shortage, as is the case in India.
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