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Market and Objective |
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India is one of the most interesting and fastest growing markets in Asia. The agriculture sector amounts 25% of the Indian economy. The remaining 75% are divided into 25% industrial sector and 50% service sector.
The country with an area of 3.29million square km is the most richly endowed agricultural nation in Asia. One tenth of the world’s arable land (169 million hectares) and one fifth of the world’s irrigated land (56 million hectares) belongs to India. 60% of the Indian labor force (about 406 million employees) are employed in the agricultural sector.
India is one of the world’s largest food producers. It is second largest producer of fruits (45 million tonnes) after Brazil and the second largest producer of vegetables (90 million tonnes) in the world, next to China. More than 40 kinds of vegetables are grown in India and 13% of world’s production of vegetables comes from India.
The main products within the agricultural sector are rice, wheat, oilseed, cotton, jute, tea, sugarcane, potatoes, cattle, water buffaloes, sheep, goats, poultry and fish.
India with diverse soil and climate comprising several agro-ecological regions provides ample opportunity to grow a variety of horticulture crops. These crops form a significant part of total agricultural produce in the country comprising of fruits, vegetables, root and tuber crops, flowers, ornamental plants, medicinal and aromatic plants, spices, condiments, plantation crops and mushrooms.
Contract farming is increasingly being used by the private and the cooperative sector industry to overcome the challenge of small land holdings of Indian farmers. Large corporates and international companies use contract farming to produce a consistent quality crop for processing; some recent projects have been in growing tomato, cotton, tobacco, gherkins, grapes, sun flower seed, chillies, flowers, banana, ginger, herbs etc.
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India is the second largest producer of fruits and vegetables. It produces 40,0 million tonnes of fruits and 90 million tonnes of vegetables a year. The main produced fruits are Mangoes (10,5 million tonnes, 1st place), bananas (16,0 million tonnes 1st place), pineapples (1,6 million tonnes 1st place) and oranges (1,7 million tonnes 7th place).
The main produced vegetables are onions (4,9 million tonnes 2nd place), potatoes (25 million tonnes 3rd place), peas (2,0 million tonnes 1st place) and tomatoes (7,4 million tonnes 2nd place). The fruit and vegetable exports increased from 154 million USD 97/98 to 225 million USD 02/03. Especially Mangoes (Value 14 Mio. USD), Grapes (value 17 Mio USD) and Onion (value 57 Mio USD) were exported highly.
India produces 45% of the world production of Mangoes. The reason of the high export rate may be that Indian vegetables are unique in taste and quality. India has an excellent trading environment and strong support to exports as well as a network of research and development institutions. The growth in production of fruits and vegetables is about 8-9% per annum.
Horticultural crops play a unique role in India’s economy by improving the income of the rural people. Cultivation of these crops is labor intensive and as such they generate lot of employment opportunities for the rural population.
Fruits and vegetables are not only used for domestic consumption and processing into various products (Pickles, preserves sauces, jam, jelly, etc.) but also substantial quantities are exported in fresh and processed form, bringing much-needed foreign exchange for the country.
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India has a livestock population of 470 million that includes 205 million cattle and 90 million buffaloes. The country produces about 800 million broilers and 35billion eggs annually. Animals that are generally used for production of meat are cattle, buffalo, sheep and goats, pigs and poultry.
a) Meat
The total meat production in the country is to the tune of 4.5 million tonnes per annum. This includes meat products also. The slaughtered rate in relation to the population of animals is about 6% in the case of cattle, 10% in the case of buffalo, 99% in case of pigs, 30% in case of sheep and 40% in case of goat. The production of value added meat and meat products are also steadily increasing.
b) Poultry
With the growth of poultry in the country, there has been a sharp rise in the availability of egg and broilers. With the increase in availability of eggs in the country and a rising demand for egg products in Europe, Japan and other countries, six egg-processing units were established from the year 1994 to 1996. These units have started exporting egg products like egg powder, albumin powder and frozen yolk. Though initially there was a boom in the export of egg products but in 1997, a sudden downfall occurred in the demand of egg products. The export has got a setback and only three units in the country are running with 25% capacity.
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India has one of the largest livestock population in the world. Dairy development in India has been acknowledged the world over as one of modern India's most successful development programme. India's milk production is expected to touch 81 million tonnes during 2002-03 from 78 million tonnes during the previous year.
Organized dairy industry accounts for less than 15% of the milk produced in India. The share of organized industry is expected to rise rapidly, especially in the urban areas.
Dairy products in India will see a healthy growth of almost 10% in current value terms in 2004, to post sales of up to USD 1,5 billion. This robust growth can be attributed chiefly to packaged milk, which saw healthy growth arising from the switch to branded milk among middle-class consumers and the rural affluent. Cheese and flavored milk drinks are projected to experience robust growth over 2004, albeit from a small base. With current value growth rates of 14% and 27% respectively, both products collectively account for merely 9% of total.
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Over the last 50 years the infrastructure has been developed for processing of the marine products. At present there are over 402 freezing units with a daily processing capacity of 8500 tons and 485 frozen storages with a capacity of 109090 tons.
The marine products are exported to over 64 countries. Value added exports has not yet though gone to higher or greater percentages, Japan remains the most important market in terms of value followed by USA, South East Asia and European Union.
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India is a treasure house of medicinal aromatic plant species. There are more than 50 type of spices with an annual production of 2,9 million tonnes. India is the largest producer, consumer and exporter of spices. The most produced and exported spices are black pepper, cardamom, ginger, garlic, turmeric and chilli.
India accounts for 9.3 per cent of world oilseed production. It has the world's fourth largest edible oil economy. Yet, about 43 per cent of edible oil available in India is imported. In 1999, India ranked as the world's largest importer of edible oils, displacing China. The bulk of edible oil India imports is of Malaysian and Indonesian origin.
India has approximately 300 crude edible oil refining units, 60-70 per cent of which are small. Unlike the bigger refiners, the small ones are unable to import huge quantities of crude either due to their low capacity or lack of financial resources, and may be forced to consolidate or sell out to the bigger ones in the foreseeable future.
Even India is a big producer of herbs. Herbs have been used for thousands of years in many cultures around the world for the prevention of disease and the alleviation of common ailments. Nowhere have herbs been so successfully used as in India where Ayurvedic practitioners have relied on precise combinations of herbs for treating specific ailments. They are essential for the Indian cuisine and demanded more and more even from foreign customers.
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a) Tea
India is a country known for its quality teas, such as Darjeeling and Assam. These kinds of tea are appointed from the region they were cultivated. India is the world's largest producer of tea and the world's largest consumer. For the people of India, tea is an integral aspect of everyday life. The three main categories of tea are black, green and oolong. Within each of these categories there are many varieties. 2001 the tea production of India was about 853.710 tonnes with a part of the world production of 28,3%.
b) Coffee
Already known for a huge and high-quality tea production, India is also the sixth largest producer of coffee in the world, and has grown coffee in commercial quantities for well over 160 years. Much of India's coffee is shipped to Europe, Japan, and the Middle East, where Indian coffees have always commanded a premium price. Very little of India's production has traditionally made it to the U.S. until recently.
c) Cocoa
There are 20 units engaged in the manufacture of cocoa products like chocolates, drinking chocolates, cocoa butter substitutes, cocoa based malted milk foods with a production of approximately 34 thousand tonnes.
In the parts of Mysore, Mandya, Chamarajanagar, Bangalore, Hassan, Tumkur, Chitradurga and Davangere, where all the coconut gardens are irrigated the growth of cocoa is remarkable.
With the chocolate manufacturing industries projecting a demand of 30,000 tonnes by 2005, the demand for cocoa both in international and domestic markets is increasing rapidly. Research proved that the mixed cropping / growing cocoa as an inter- crop with coconut or arecanut helps reduce use of fertilizers and improves yield without requiring additional land. Also, there is very good scope for growing cocoa in well irrigated regions of Karnataka and hence cocoa cultivation in 3000 ha of coconut gardens in Mysore, Mandya, Chamarajanagar, and Bangalore districts have been planned during the 8th and 9th plan periods.
d) Soft Drinks
The estimated production of soft drinks has increased from 6450 million bottles in 2000-01 to 6600 million bottles during the year 2002-03. It constitutes the third largest packaged food category which is regularly consumed after packaged tea and biscuits. The soft drinks industry in India comprises of over 100 plants across the country. At present, there are more than 7000,000 outlets in the country.
The soft drinks industry has attracted one of the highest foreign direct investments in the country amounting to around RS. 47 billion. The total export earnings of the soft drinks industry is over RS. 7 billion per annum.
e) Beer & Alcoholic Drinks
At present, there are 56 units manufacturing beer under license from the Government of India having a production capacity of 121.6 million doz. per annum. On the other hand, the production of alcoholic drinks from non-molasses sources is very small in the country compared to the total production of alcoholic drinks. However, with various foreign companies producing non -molasses alcoholic drinks such drinks are gaining popularity in the domestic market.
The wine industry has made a beginning in India and is establishing itself as a quality conscious industry. The estimated annual production of wine is over 1 million bottles.
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Bakery industry in India is probably the largest among the processed food industries, production of which has been increasing steadily in the country. The two major bakery industries, viz., bread and biscuit account for about 82% of the total bakery products. The annual production of bakery products which includes bread, biscuits, pastries, cakes, buns, rusk, etc., most of which are in the unorganized sector, is estimated to be in excess of 3 million tonnes. The production of bread and biscuits in the country both in the organized and unorganized sectors is estimated to be around 1.5 million tonnes and 1.1 million tonnes respectively. Of the total production of bread and biscuits, about 35% is produced in the organized sector and the remaining is manufactured in the unorganized sector.
50% of the confectionery market lies in rural areas, and the market is growing at a rate many times more than the urban market. Registering a growth of almost 7% in current value terms in 2002 over the previous year, South India is largest region for confectionery, accounting for 30% of value sales in the country. Sales are driven mainly by sugar confectionery, which makes up almost over 50% of India’s confectionery value sales. Sugar confectionery is extremely fragmented and has presence of many brands.
Sales of savory snacks in India in 2004 are expected to reach nearly USD 150 million or 50.000 tonnes. This represents robust growth of 16% in current value and 13% in volume terms over the previous year, thus indicating the success of organized players as consumers gradually experiment with branded snacks from the typically unbranded types.
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The introduction and rapid spread of high-yielding rice and wheat varieties in the late 1960s and early 1970s resulted in steady output growth for food grains. Public investment in irrigation and other rural infrastructure and research and extension, together with improved crop production practices, has significantly helped to expand production and stocks of food grains.
Indian agriculture has undergone technological change at different rates across regions and among different crops. Rapid growth in wheat and rice production has resulted in substantial increases in the marketable surplus of wheat and rice
Cereals dominate food expenditures in India; rice ranks first followed by wheat and coarse grains
India is now the largest producer of rice with a large domestic base. India’s part of the world rice production is over 20% (134,15 million tonnes). The export rate of rice is increasing steadily. Basmati rice is mostly exported to Saudi Arabia (51%), the UK (14%), Kuwait (10%) and the USA (6%). The Non Basmati rice is mostly exported to Bangladesh (38%), Saudi Arabia (27%) and South Africa (8%).
Also, India is the largest producer of wheat (74,25 million tonnes). 10,7% per cent of the world production comes from India. The main importers of Indian wheat are Bangladesh, Korea, the UEA and the Philippines.
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| For more information please contact us …more |
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| Overall project management: |
Indian Exhibitors please contact |
Mr. Chandra Shekhar
Federation of Indian Chambers of Commerce & Industry (FICCI)
Tel : +91 11 23316551
Fax : +91 11 23359734
annapoorna@ficci.com
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