Overview of the Agri-Processed Food Industry in India

The agri-processed food industry encompasses various activities involved in transforming raw agricultural products into ready-to-consume food items. This includes processing, packaging, and distributing a wide range of products like fruits, vegetables, dairy, meat, grains, and beverages. The industry plays a crucial role in enhancing the shelf life of food products, reducing wastage, and providing value-added products to consumers.

Stats:

The Indian food processing industry is valued at approximately USD 535 billion as of 2023.

It contributes around 8.2% to the Gross Value Added (GVA) in manufacturing and about 13% to India’s exports.

The industry is growing at a Compound Annual Growth Rate (CAGR) of 11%.

Historical Growth and Development

India’s agri-processed food industry has evolved significantly over the past few decades. Traditionally, food processing in India was limited to basic techniques like drying, grinding, and fermenting. However, with economic liberalization in the 1990s, the sector began to modernize rapidly. Key milestones in its growth include:

1991: Economic liberalization opened up the Indian market, attracting foreign direct investment (FDI) and leading to the establishment of modern food processing units.

2000s: Expansion of cold chain infrastructure, advancements in technology, and rising consumer demand for convenience foods spurred growth.

2010s: Increased focus on food safety standards, quality control, and exports led to the emergence of India as a significant player in the global agri-processed food market.

Stats:

The number of registered food processing units increased from 25,367 in 2000 to over 40,000 by 2020.

Export of processed food products from India reached USD 41 billion in 2022.

Key Drivers Behind the Rise of This Industry

Several factors have contributed to the rise of the agri-processed food industry in India:

Urbanization and Changing Lifestyles: Rapid urbanization and the growing middle class have increased the demand for convenient, ready-to-eat food products.

Technological Advancements: Innovations in food processing technologies, such as cold storage, packaging, and automation, have enhanced efficiency and product quality.

Rising Export Opportunities: India’s diverse agricultural base and cost-competitive processing capabilities have positioned it as a major exporter of processed foods.

Government Support: Various policy measures and incentives, including subsidies, tax benefits, and the establishment of food parks, have provided a significant boost to the industry.

Stats:

Urban population in India has grown from 28% in 2001 to 34% in 2021.

The processed food market is expected to grow at a CAGR of 14.6% between 2021 and 2025.

Major Players and Their Contributions

Several key players have shaped the landscape of the agri-processed food industry in India. Some notable ones include:

Amul: A pioneer in dairy processing, Amul has revolutionized the dairy industry with its wide range of value-added products like butter, cheese, and ice cream.

ITC Limited: With its extensive portfolio of processed food brands like Aashirvaad, Sunfeast, and Yippee!, ITC has made significant contributions to the packaged foods segment.

Nestlé India: Known for its popular brands like Maggi, Nescafé, and KitKat, Nestlé has been a major player in the processed food market.

Britannia Industries: A leading player in the bakery and dairy segments, Britannia offers a wide range of processed food products, including biscuits, cakes, and dairy items.

Stats:

Amul’s turnover reached INR 52,000 crores (approximately USD 7 billion) in 2022.

ITC Foods division reported revenues of INR 12,900 crores (approximately USD 1.7 billion) in 2022.

Future Growth Prospects and Government Initiatives

The future of the agri-processed food industry in India looks promising, driven by several factors:

Increasing Domestic Demand: Rising disposable incomes and changing dietary preferences will continue to drive demand for processed foods.

Export Potential: India has the potential to significantly increase its share in the global processed food market, leveraging its diverse agricultural resources and cost advantages.

Technological Innovations: Continued advancements in processing technologies, packaging, and supply chain management will enhance efficiency and product quality.

Stats:

The Indian food processing market is projected to reach USD 958 billion by 2026.

Processed food exports are expected to grow at a CAGR of 10% over the next five years.

Government Initiatives

The Indian government has launched several initiatives to support the growth of the agri-processed food industry:

Pradhan Mantri Kisan Sampada Yojana (PMKSY): This scheme aims to create modern infrastructure for food processing, reduce wastage, and increase the income of farmers.

Mega Food Parks Scheme: Establishing state-of-the-art infrastructure facilities for food processing along the value chain from farm to market.

Ease of Doing Business: Simplifying regulatory procedures and providing financial incentives to attract investment in the food processing sector.

Stats:

Under PMKSY, the government has approved projects worth INR 6,000 crores (approximately USD 800 million) benefiting over 20 lakh farmers.

42 Mega Food Parks have been approved, aiming to provide infrastructure to boost food processing capacities.

In conclusion, the agri-processed food industry in India is poised for substantial growth, supported by favorable demographic trends, technological advancements, and proactive government policies. This sector not only holds the promise of enhancing food security and reducing wastage but also offers significant opportunities for economic growth and employment generation.