Market Overview – India

Country profile

The Indian economy is in the process of undergoing a rapid expansion, along with rapid urbanization electrification, productivity growth, and expansion of the middle class. India remains a net exporter of agri-food and as of 2023, the enormous potential of the Indian market remained largely untapped. Canadian exports of agri-food to India were limited, mostly dominated by a single category. India's population is relatively young, and the country is expected to benefit from a demographic dividend.

India was the world's fifth largest economy in 2023, with a value of US$3.7 trillion. India is ranked 5th in world's GDP rankings in 2024. India's economy boasts diversity and swift growth, fuelled by key sectors such as information technology, services, agriculture, and manufacturing.

Production

In 2022, India's most produced crop was sugar cane, with 439.4 million tonnes produced. Sugar cane production increased at a CAGR of 3.7% from 2018-2022. Dry onion saw the fastest production growth of CAGR 8.0% from 2018-2022, with production rising from 23.3 million tonnes in 2018 to 31.7 million tonnes in 2022. The CAGR growth was followed by maize at 4.1% from 2018 to 2022.

Chickens were the most common livestock produced in 2022, with 852.3 million heads produced in 2022. Cattle was a second for livestock produced in 2022, with 193.6 million heads produced. Goats was the third most common livestock produced, with 149.9 million heads produced in 2022.

Chicken was the most produced meat in India in 2022, measured by weight. 4.9 million tonnes of chicken were produced in 2022, up from 4.1 million in 2018. Chicken production grew at a CAGR of 4.8% over the historic period.

Trade

In 2022, India was a net exporter of agri-food and seafood products, with total imports of Can$48.5 billion, and exports of Can$70.9 billion, making for a total trade surplus of Can$22.4 billion. India's imports of agri-food and seafood products increased at a CAGR of 14.8% from 2018-2022. The top 5 suppliers of agri-food and seafood products to India were Indonesia (16.7%), Malaysia (10.9%), Argentina (9.7%), Brazil (7.3%) and the United States (6.4%).

Canada was India's twenty-sixth largest supplier of agri-food and seafood products in 2022, with Can$453.3 million in imports (0.9% market share) and Can$826.9 million in export. In 2022, India had a trade surplus with Canada in agri-food and seafood products, totalling Can$374.6 million (Can$826.9 million to Can$452.3 million).

In 2022, India's largest imports were palm oil, soya-bean oil, and sunflower oil, all products for which the proportion supplied by Canada was negligible or non-existent.

The top category of agri-food and seafood exports from Canada to India in 2022 was dried and shelled lentils, representing 60.7 % of the imports from the world (Can$702.2 million) in this category.

Canadian exports of agri-food and seafood have increased from 2018-2022 by a CAGR of 25.2%, from Can$170.5 million in 2018 to Can$419.0 million in 2022. In 2022, dried and shelled lentils were Canada's top agri-food export to India, with a value of Can$393.7 million (94% of Canadian exports to India). Canada's next largest exports were solid lactose and lactose syrup (Can$6.6 million, 1.6% share), dog or cat food (Can$3.2 million, 0.8% share), and glycerol, crude; glycerol waters and glycerol lyes (Can$2.6 million, 0.6% share).

Canada exported agrifood and seafood to India in Can$ thousand 2018-2022

Imports of processed food increased by a CAGR of 16.5% from 2018 to 2022, with most of the growth attributable to growth in imports of crude palm oil, which grew at a CAGR of 20.8% and was the top import in 2022. The fastest growing import from 2018 to 2022 of the top ten processed foods was olive oil "eu cat. 4 and 5" and fractions, which grew at a CAGR of 55.1%, with the value of India's imports rising from Can$61.1 million in 2018 to Can$353.5 million in 2022.

In 2022, India imported Can$35.4 billion worth of processed food and beverages, with Canada supplying Can$20.9 million (0.1%) of that total. India's largest suppliers of packaged foods were Indonesia (Can$7.6 billion, 21.6% share), Malaysia (Can$5.3 billion, 14.9% share), Argentina (Can$4.6 billion, 13.1% share) and Brazil (Can$3.2 billion, 9.1% share), which collectively held 58.7% of the market.

Packaged food retail sales

In 2023, sales of packaged food in India were valued at US$99.9 billion. From 2018 to 2023, sales of packaged food increased by a CAGR of 8.8%, and sales are expected to increase at a CAGR of 9.0% from 2023-2028, reaching US$153.7 billion in 2028.

From 2018 to 2023, staple foods was the category which saw the fastest growth, having seen sales grow from US$10.1 billion in 2018 to US$19.1 billion in 2023 (CAGR of 13.4%). Growth in staple foods was primarily driven by growth in rice pasta and noodles, which saw sales grow at a CAGR of 16.0% from 2018 to 2023, and in 2023 made up 75.6% of staple foods sales. In 2023, Dairy Products and Alternatives was the largest category of packaged food, with US$31.4 billion in sales, dominated by the subcategory dairy, which had US$30.3 billion in sales (96.6% of Dairy Products and Alternatives). Cooking Ingredients and Meals was the second largest category, with US$29.4 billion in sales. Edible oils was the largest subcategory, with US$24.3 billion in sales. From 2023 to 2028, staple foods is the category expected to once again have the fastest growth rate, with sales growing by a CAGR of 12.1%.

Health and wellness retail sales

Vitamins and dietary supplements experienced remarkable growth, becoming a billion dollar industry by 2023 at the value of US$2.0 billion. The pandemic led to increased consumer health product sales. Vitamins in particular were positively affected by a desire on the part of consumers to bolster their immune systems.It is expected to reach US$3.1 billion by 2028.

Strong growth is forecast in the weight management sector, at 14.3% overall CAGR through 2028. Weight management products will show strong growth as a response to increased obesity in India. This will be driven by increased sales of meal replacement products and weight loss supplements.

In 2023, 7.0% of cooking ingredients and meals sold in India were labeled as vegetarian, making it the most common claim on health and wellness products. Cardiovasc products are marginal, representing 0.4% of the market in 2023, but they are not growing, and expected to remain 0.4% of the market in 2026.

Low-fat Better for you products represent 42.6% of the market in 2023. Dairy-free Dietary/free from calim is insignificant all at 0.1% from 2019 to 2026.

High protein is the baked goods positioning claim, representing 7.7% in 2023. Some baked good mixes are marketed as natural, representing 5.4%, but this is insignificant in terms of total baked goods sales data.

Health and wellness positioning claims are very important for cereals. Nearly a 64.9% of breakfast cereals sold in India in 2023 were marketed as vegetarian. High fibre, low fat and natural claims are also very common. Immune support claims are growing, from 2.5% in 2019 to 4.7% in 2023.

Vegetaria claim is somewhat most common on processed fruit and vegetable products, representing 63.6% in 2023. It is notable that health benefit processed fruits and vegetables have an insignificant market share in India.

The notable claims for processed meat, seafood and alternatives products are high protein and gluten free claims. As is the case for processed fruits and vegetables, organic products are a negligible part of the market.

Rice, pasta and noodles do not tend to advertise health and wellness claims. Dietary or free from and fort/funtional claims are commonly advertised. Most pasta will be vegetarian. Organic is also very common.

Fortified and functional or diet/free from snack claims are relatively common, at 8.0% and 7.2% market share in 2023. Health benefit snacks are not particularly popular.

According to Mintel's Global New Products Database, at least 5,504 new and relaunched products with healthy claims were introduced on the India market from 2019 to 2023. The top five categories were snacks, sauces and seasonings, bakery, healthcare and pet food.

Most of the health and wellness packaged food products launched in India over the past five years were moderately priced: a majority of newly released products cost less than US$12.99, and very few cost more than US$13.00. Generally speaking, the most common claims were "free from" claims: products that are advertised as having no additives or preservatives at all, no artificial additives or preservatives, and no added or artificial colourings or flavourings. Most products sold on the market were domestic. Snacks, sauces and seasonings were the two biggest categories for new releases over the five year period.

Foodservice

Independent foodservice saw the value of its retail sales increase by 1.3% CAGR from 2018 to 2022, and many businesses closed. Nonetheless, independent foodservice remained the largest foodservice category in 2022.

All foodservice categories recovered in 2022. Cafés and bars, which were the category most affected by the pandemic, are forecast to grow at 14.2% CAGR from 2023 to 2027. Independent foodservice should grow 9.3% CAGR over this period as well. It will be surpassed by chained foodservice, which has a forecast CAGR of 13.9%. Limited service restaurants will maintain their steady growth, at 11.8% CAGR through 2027.

The majority of foodservice sales in India occur through standalone outlets, and these maintained positive growth over the 2018-2022 period. Standalone, leisure, retail, travel and lodging all increased in growth from ranging from 1.0% to 8.4% between 2018 and 2022. They are all expected to recover through 2027, with each having a forecast CAGR ranging from 9.3% to 13.1% from 2023 to 2027.

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Resources

• Euromonitor International, 2024
• Global Trade Tracker, 2024
• FAOSTAT Agricultural Production, 2024

Market Overview – India
Global Analysis Report

Prepared by: Hongli Wang, Market Analyst

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