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Indian Food Processing Industry Analysis

April, 2014

India holds the second largest arable land in the world. With 20 agri-climatic regions, all 15 major climates in the world exist in India. The country also possesses 46 of the 60 soil types in the world.

India is the largest producer of pulses, milk, tea, cashew and mangoes; and the second largest producer of tea, wheat, sugarcane and rice. Globally, it has the largest livestock population which includes more than 300 million cattle; the segment contributes about 25 per cent of the country’s farm gross domestic product (GDP). Demand growth for processed food has been rising with growing disposable income, urbanisation, a young population and rise in the number of nuclear families.

The food processing industry is among the largest industries in India and ranks fifth in terms of production, consumption and exports. With an estimated value of US$ 121 billion in FY 12, India’s food processing industry accounts for 32 per cent of the total food market.

The Government of India expects US$ 21.9 billion of investments in food processing infrastructure by 2015 and has also launched Infrastructure Development Scheme to increase investments in food processing infrastructure. Investments, including foreign direct investments (FDI), will rise with strengthening demand and supply fundamentals.

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