Growth of FMCG Industry in India - Infographic

The FMCG industry in India is expected to grow between 4.5-6.5% in 2024, on the back of continued strength in the sector and the Indian economy.

Advantage India

Growing
Demand

*Indian food processing market size reached US$ 307.2 billion in 2022 and is expected to reach US$ 547.3 billion by 2028, exhibiting a growth rate (CAGR) of 9.5% during 2023-2028.

*Digital advertising grew to reach US$ 9.92 billion by 2023, with the FMCG industry being the biggest contributor at 42% share of the total digital spend.

*As per CRISIL, India's dairy industry is projected to experience a healthy revenue growth of 13-14% in FY25, driven by strong consumer demand and increased raw milk supply.

Attractive
Opportunities

*With rising disposable incomes, FMCG companies should enhance their digital presence and invest in direct-to-consumer (DTC) models. Increased rural consumption presents an opportunity for expanding distribution networks in tier-2 and tier-3 cities.

*Entrepreneurs interested in setting up food-related FMCG industry can setup their processing units in the government-designated agro-processing clusters, which help cut down the plant setup costs.

*With the advent of online retail and e-commerce, FMCG businesses are able to market and sell their products across the country without investing much in marketing activities.

*The quick commerce market could reach between US$ 25 billion and US$ 55 billion by 2030, driven by an increase in high-frequency, high-value users.

Policy
Support

*The Union Budget 2025-26 provides a strong push to consumer spending, particularly benefiting the FMCG industry. The increase in disposable income, rural development focus, and MSME support create an ideal environment for growth.

*Union Budget 2023-24 has allocated US$ 976 million for PLI schemes that aims to reduce import costs, improve the cost competitiveness of domestically produced goods, increase domestic capacity, and promote exports.

*Union budget 2023-24 focuses on reviving rural demand by boosting disposable income, allocation to farms and higher fund allocation on rural infrastructure, connectivity, and mobility to create long-term jobs

Higher
Investments

*Amul will set up the world's largest curd plant in Kolkata, West Bengal, with an investment of Rs. 600 crore (US$ 68.6 million), processing 10 lakh kilograms (KG) daily.

*Varun Beverages announced of investing Rs. 3,500 crores (US$ 421.69 million) to setup manufacturing plants, while generating 1,500 employment opportunities.

*In January 2023, ITC has announced plans to acquire 100% of Sproutlife Foods over a period of three to four years.

*In December 2022, Hindustan Unilever Limited announced its foray into the ‘Health & Wellbeing’ category through strategic investments in OZiva and Wellbeing Nutrition.