By Kate Madley
India’s affluent, urban consumers are looking for quality food brands – and Welsh food companies have all the right ingredients.
A new report by the UK India Business Council and Eversheds highlights opportunities for exporters to capitalise on India’s fast growing food and drink market.
India is one of the largest producers and consumers of food in the world, with approximately 16% of the world’s population and 12% of global food production, and the country has many untapped and under-served markets.
“With an expanding middle class and rapidly rising income levels, India’s consumption-led economy is creating ever greater demand for Western brands,” said Richard Heald, chief executive of UKIBC.
“With millions of affluent and quality and brand conscious customers, India will be the world’s third largest grocery market by 2015.”
Food processing is valued at £45 billion a total of 35% of the Indian food market. Rising popularity in kirana stores means Indians are now benefitting from convenience suppliers offering more flexibility than supermarkets.
Heald says India’s growth story isn’t just about Indian consumers buying more and believes this gives Welsh companies such as Beacon Foods and Abergavenny Fine Foods opportunities.
“They are buying brands, and more importantly they are buying British brands. What Welsh food and drink retailers need to know is that Indians have an affinity for British products, and that this gives Welsh companies, a huge competitive advantage in the Indian market. By looking at the market now, they will have first mover advantage.”
The report says ‘Tier 2 and 3 cities’ offer the next wave of growth as there is an appetite for imported items to meet demand. And it singles out the anglicised Eastern region of India, with a population of over 400 million people, as a particularly under-served market.
“Connecting Wales’s food and drink manufacturers and suppliers, with India’s fast-expanding numbers of urban based consumers, who have improving purchasing power and international tastes, is the complex and interesting challenge for our established and wanabee Welsh exporters,” said Rob Forman, Independent Contractor, Food & Drink Manufacture and Trade.
“Initially establishing which Welsh products will appeal best to which regional market of emerging urban Indian consumers, and finding a cost-effective and reliable supply route to market is by no means easy, but help is readily available from both public and private sector contacts.
“Targeted Market Research by locally based experts, and country visits via a Trade Mission or a Trade Exhibition are the popular first options for potential exporters, with finding a suitable local Indian importer/distributor partner coming a close second.
“Over recent years Wales has established a wide range of quality added-value food and drink products, often utilising Wales’s ready availability of sea-product, meat, dairy and other natural and agricultural products, all of which must always fully satisfy the UK demanding quality, technical and packaging regulations which is a big plus to potential India-based importer.
“Although few brand from Wales are well-known outside of the UK, there are still many overseas destination supply opportunities for niche Welsh products and brand, including in India.”
Standard Chartered predicts the Indian food market will expand to $4 trillion by 2030, giving Welsh businesses a big target to tap into.