Why Packaged Food Sector Has Immense Opportunity In India

Sneha Santra
Sneha Santra Jun 08 2018 - 4 min read
Why Packaged Food Sector Has Immense Opportunity In India
The Size Of The Global Processed-Food Market Is Estimated At USD 3.2 Trillion And Nearly 80 Per Cent Of Agricultural Products In The Developed Countries Get Processed And Packaged.

As nations such as China, India, Brazil and Russia become wealthier; they are changing their eating habits. In particular, they are buying more packaged foods. The Indian packaged processed foods industry is estimated at US$ 10.87 billion – US$ 13.05 billion, including biscuits, chocolates, ice-cream, confectionery, snacks, cheese and butter. 

The industry is growing at a healthy 14-15 per cent over the past two-three years. Industry executives said ITC’s packaged food business is continuing to drive its FMCG growth with personal care brands yet to break into the Rs 1,000-crore plus trajectory. 

The industry received foreign direct investments (FDI) totalling US$ 143.80 million in 2008-09 against US$ 5.70 million in 2006-07. Here are few factors that have led to an increase in the consumption of packaged food and beverage segment in India.


With India’s changing demographics, the population in emerging cities is also increasing and there is a visible change in lifestyles and food habits of consumers. People are shifting from traditional food to adjusting and adapting urban packaged food habits.

Further, increasing urbanization also results in the increase in nuclear families, increase in the percentage of working women, less time available for preparing meals and beverages at home and increasing consumption of easy to prepare or ready-to-make food. This leads to increase in consumption of the packaged food and beverages as consumers look for food that can be made quick and trusted for quality and health.

Dietary Food

India has a variety of cuisines, with each region having their own specialities. Indians like to experiment with new cuisines as they become more aware of products available in the market. T

his change in food habits is resulting to an increase in demand for a variety of ingredients and beverages which leads to different innovative products that would either meet the specific tastes or would meet the health requirements of the consumers. Domestic demand for processed foods or packaged food and beverages is linked to household disposable income of middle class and a driving force for the consumer goods market.

Advertising and Accessibility

Advertisements on television and social media by the manufactures of the packaged foods are making the Indian consumers aware of the new product launches along with their USP. Along with rising awareness, the companies are making sure that the products are also easily accessible for consumers to buy from their nearby stores or supermarkets.

“While Bingo, Aashirvaad atta, and Dark Fantasy Choco Fills premium cream biscuits were the key drivers of growth in the branded packaged foods businesses, Engage deodorants, Vivel and Fiama soaps & shower gels and Savlon handwash fuelled strong growth in personal care business,” says, an ITC Spokesperson.

With the population in Indian urban areas increasing, the number of supermarkets has also increased, providing consumers with a range of products under one roof and thereby increasing the awareness of the high-growth segment products and increasing their sales.

Acceptability and Trust

Consumers are increasingly seeking value and better outcomes from self-management of health and wellness. Therefore, certain sections of consumers do check the health benefits before buying. With the growth in the retail industry, supermarkets and food chains, the health benefits of associated packaged food and beverages are visible.

Therefore, Indian consumers are increasingly consuming them due to their health benefits promised by the products or the natural ingredients used to make the products. Further, consumers trust branded products due to the quality standards assured by the manufacturers.

Therefore, with the increase in disposable income and awareness, Indian consumers are increasingly consuming the food and beverages of high-growth segments of packaged food.

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