Here is an essay on ‘Indian Food Industry’ for class 8, 9, 10, 11 and 12. Find paragraphs, long and short essays on ‘Indian Food Industry’ especially written for school and college students.
Essay on Indian Food Industry
- Essay on the Introduction to Indian Food Industry
- Essay on the Status of Indian Food Industry
- Essay on the Strength and Weakness of Indian Food Industry
- Essay on the Opportunities of Indian Food Industry
- Essay on the Threats to Indian Food Industry
Essay # 1. Introduction to Indian Food Industry:
India’s culinary tradition is constantly changing. With urbanization, rising incomes, more working women and a proliferation of fast food outlets, the acceptance of packaged and ready-to-eat food products is increasing, especially among the urban middle class. Demand for specialty and high-value processed or packaged and ready to serve/ready to cook or reconstitute food items has increased.
India is the world’s second largest producer of food next to China. India, with diverse agro-climatic conditions, has a production advantage in many agricultural goods, with the potential to cultivate a large range of agricultural raw materials required by the food-processing industry. India is a major producer of spices, spice oils, essential oils, condiments, and fruit pulps.
Significant variations in food habits and culinary traditions across the country translate into a competitive advantage for small and medium local players, who are familiar with local food habits and markets. Some Indian food-processing companies have increased market share by decreasing product prices. High import duties on processed food and food ingredients make imports relatively costlier.
The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food processing, especially in areas of canning, dairy processing, specialty processing, packaging, frozen food/refrigeration and thermal processing. The industry has witnessed fast growth in most of the segments. In India the food processing sector is one of the largest in terms of production, consumption, export and growth prospects.
The important sub sectors in food processing industries are fruit and vegetable processing, fish- processing, milk processing, meat and poultry processing, packaged/convenience foods, alcoholic beverages and soft drinks and grain processing etc. The government has also accorded it a high priority to encourage commercialization and value addition to agricultural produce for minimizing post-harvest wastage, generating employment and export growth.
Essay # 2. Status of Indian Food Industry:
Processed Food Sector:
The turnover of the total food market is approximately Rs.250,000 crores (US $ 69.4 billion) out of which value-added food products comprise Rs. 80,000 crores (US $ 22.2 billion). Primary food processing is a major industry with lakhs of rice-mills/hullers, flour mills, pulse mills and oil-seed mills.
There are several thousands of bakeries, traditional food units viz. fruit, vegetable and spice processing units in unorganised sector. The size of the semi-processed and ready to eat packaged food industry is over Rs. 4000 crores (US $ 1 billion) and is growing at over 20 per cent.
In the organised sector, there are over 820 flour mills, 418 fish processing units, 5198 fruits and vegetable processing units, 171 meat processing units and 668 dairy processing units. India is the world’s second largest producer of fruits and vegetables, but hardly 2 per cent of the produce is processed.
India is the land of spices producing all varieties worth over Rs. 3500 crores (US $ 900 million) amounting to 25-30 per cent of world production, which is processed for value-addition and export. It grows 22 million tonnes of oilseeds covering most of the varieties. Other important plantation products include tea, coffee, cocoa and cashew etc.
It is a matter of pride that India is the number one milk producing country in the world, maintaining the top position since 1988, thanks to successful implementation of the Operation Flood Programmes. World milk production is estimated at 613 million tons growing at a CAGR of 1.3 per cent. Indian production stands at 100 million tons growing at a CAGR of 4-5 per cent.
Hence, India contributes 4 million tones to the world’s incremental production of 7.5 million tonnes. Despite a higher growth rate, the per capita availability of milk in India (229 grams per day) is lower than the world average (285 grams per day). Buffalo milk is now estimated to account for 57 per cent of the total milk production in India.
India has a unique pattern of production, processing and marketing/consumption of milk, which is unparallel. About 70 million rural households (primarily, small and marginal farmers and landless labourers) in the country are engaged in milk production to change the dairy sector into viable self-sustaining organized sector. About 35 per cent of milk production, over 11 million farmers are organized into about 0.1 million village dairy cooperative societies (DCS).
The cumulative milk handled by DCS across the country is about 18 million kg of milk per day. These cooperatives form part of a national milk grid which links the milk producers throughout India with consumers in more than 700 towns and cities bridging the gaps on account of seasonal and regional variations in the availability of milk.
In India current annual growth rate in milk production is pegged between 4 to 6 per cent. This is primarily due to the initiatives taken by the operation flood programmes in organizing milk producers into cooperatives to turn the dairy sector into viable self-sustaining organized sector. About 35 per cent of milk products in India is processed. The organized sector processes about 13 million tones annually, while the unorganized sector (halwaiis and vendors) processes about 22 million tones per annum.
In the organized sector, there are 676 dairy plants in the cooperative, private and government sectors registered. There is huge potential for processing and value addition, particularly in traditional milk products, which are largely sold in unbranded form in the market.
The key differences between the organized and the unorganized sector is with respect to investments in preserving the quality of milk, technology used for processing and compliance with food standards. The solution lies in promoting investment in quality control and developing scalable efficient technologies for the unorganized sector.
Health food and health food supplements are another rapidly rising segment of food industry which is gaining vast popularity amongst the health conscious. India is one of the world’s major food producers but accounts for less than 1.5 per cent of international food trade. This indicates vast scope for both investors and exporters.
Food exports in 1998 stood at US $5.8 billion whereas the world total was US $438 billion. The Indian food industries sales turnover is Rs 140,000 crore (1 crore = 10 million) annually as at the start of year 2000. The industry has the highest number of plants approved by the US Food and Drug Administration (FDA) outside the USA.
Value Added Food Product:
Although India is a world leader in the production of milk, rice, wheat, fruits and vegetables, livestock, fish and seafood, and eggs, India’s current food processing capabilities are very small compared with its agricultural output. Only 8 per cent of total agricultural output is processed into value-added products. However, production of value-added products in India is forecast to grow by 27 per cent by 2025.
Fruits and Vegetable Processing:
The installed capacity of fruits and vegetables processing industry has increased from 11.08 lakh tons (1993) to 24.74 lakh tons (2007). The utilization of fruits and vegetables processing is estimated to be around 2.20 per cent of the total production. Over the last few years, there has been a positive growth in ready to serve beverages, fruit juices and pulps, dehydrated and frozen fruits and vegetable products, tomato products, pickles, convenience veg-spice pastes, processed mushrooms and curried vegetables.
The domestic consumption of value added fruits and vegetable products is also low compared to the primary processed food in general and fresh fruits and vegetables in particular. Hardly 2 percent of fruits and vegetables produced in India are processed.
Meat and Meat Processing:
India’s livestock population is largest in the world with 50 per cent of world’s buffaloes and 20 per cent of cattle, but only about 1 per cent of total meat production is converted to value added products. In meat and meat processing sector, poultry meat is the fastest growing animal protein in India. The estimated production is 1500 thousand tones growing at CAGR of 13 per cent through 1991-2005. Per capita consumption has grown from 870 grams in 2000 to about 1.68 kg in 2005.
This is expected to grow to 2Kg in 2009. Buffalo meat production has been growing relatively less rapidly at a CAGR of 5 per cent in the last 6 years. The current production levels are estimated at 1.9 million MT. Of this about 21 per cent is exported. Mutton and lamb is relatively small segment where demand is outstripping supply, which explains the high prices in domestic market. The production levels have been almost constant at 950,000 MT with annual exports of less than 10,000 MT.
This has restricted large processing companies from developing business interests in this sector. Indian consumer prefers to buy freshly cut meat from the wet market, rather than processed or frozen meat. A mere 6 per cent of production (about 100,000 MT) of poultry meat is sold in processed form. Of this, only about 1 per cent undergoes processing into value added products (Ready to- eat/Ready-to-cook). Processing of large animals is largely for the purpose of exports.
The total processing capacity in India is over 1 million MT per annum, of which 40-50 per cent is utilized. India exports more than 500,000 MT of meat of which major share is buffalo meat. Indian buffalo meat is witnessing strong demand in international markets due to its lean character and near organic nature. India is the 5th largest exporter of bovine meat in the world. Indian buffalo meat exports have the potential to grow significantly.
Due to emerging health threats of the diseases communicable to human through meat, the meat consumers are more vigilant towards the wholesomeness of the meat and demanding meat and poultry products processed in clean and sanitary environment. In metros and urban areas there are upcoming demands for “convenience items” such as semi cooked, ready-to-eat, ready-to-cook meat food products. Processing of meat products is licensed under Meat Food Products Order (MFPO) 1973.
The main objectives of the MFPO, 1973 are to regulate production and sale of meat food products through licensing of manufacturers, enforce sanitary and hygienic conditions prescribed for production of wholesome meat food products, exercise strict quality control at all stages of production of meat food products, fish products including chilled poultry etc.
India has large marine product and processing potential with varied fish resources along the 8041 km. long coastline, 28000 km. of rivers and millions of hectares of reservoirs and brackish water. At present, there are over 369 freezing units with a daily processing capacity of 10266 tons out of which 150 units are approved for export to EU. 499 units are engaged in production of frozen fish with a total storage capacity of 134767 tons. Apart from the above there are 12 surimi units, 5 canning units and 473 units are engaged in pre-processing and dry fish storage.
However, in 2004-05, export of marine products achieved a record 12 per cent increase in volume and 11 per cent increase in US$. Frozen shrimps constitute 63.5 per cent of total value of exports. USA is the largest importer of Indian marine products contributing 13.21 per cent in quantity and 29.8 per cent in value of total exports importing mainly frozen shrimps – HL Black tiger shrimps.
Ethnic Food/Street Food:
The concept of traditional food street has now been given a new meaning in developed countries, with food streets emerging as new tourist attractions. Major tourist destinations invariably have food streets offering exotic local foods. Street food in India has always been popular because of its affordability and convenient availability.
This is an area with huge potential for increased income generation for vendors and for giving a boost to the tourism sector. This may also lead to popularity of local food traditions, offering fast food, which are very popular among Indians.
Essay # 3. Strength and Weakness of Indian Food Industry:
Although India’s enormous population size makes it an attractive market for food manufacturers and suppliers, the majority of people do not have the necessary purchasing power to accommodate a large percentage of foreign foodstuffs. However, the strengthening Indian economy shows promise for potential exporters. According to Lynch (2007) reported that 22 per cent of Indian households (44 million households) are expected to be capable of purchasing packaged foods. In addition, there is demand for high-cost processed foods by India’s ever-increasing consumer class.
Weakness Indian Food Industry:
In an effort to comply with World Trade Organization (WTO) standards, India removed all import licensing restrictions effective April 1, 2001. The small- scale farming system in India, marketing problems, lack of grading and standards, poor distribution channels, and onerous government policies continue to pose problems for the processing industry to source the right type of raw materials and to discourage more investment in the sector.
Essay # 4. Opportunities of Indian Food Industry:
Processed foods that have done well in market include cheese, butter, ice cream, bakery products, ready-to-make foods, biscuits, chocolate, tea and milk products. Other processed foods that have good market potential in India include condiments and sauces such as ketchup, jams, jellies and pickles, in addition to healthy foods and beverages, fruit juices, cereals, confectionary, snack foods and curry powders.
Opportunities also exist for the export of processing and packaging technologies and storage and transportation alternatives as the Indian food processing industry strives to capitalize on current food surpluses and to increase its food processing capabilities to become a more prominent player in the global food market. However, the processed food market is expected to grow with continued strengthening of India’s economy.
India’s significant economic growth of 8.2 per cent in 2003 and 6.0 per cent in 2004 is forecast to continue to rise another 6.5 per cent in 2007-8. Furthermore, increased urbanization, rising incomes and changing lifestyles in which time and convenience are valued will drive demand for packaged foods and easy-to-prepare meals. Expected with this increased demand is a corresponding demand for healthy ready-to-eat foods.
The market for semi processed/cooked ready-to-eat meals in India grew 20 per cent during the 2003-2004 fiscal year. Between 2000 and 2003, demand for snack foods increased each year by 10 per cent. India’s market for processed foods is expected to more than double its value by 2015, amounting to almost $340 billion.
Several multinational companies, including US-based companies like Pepsi, Coca Cola, ConAgra, Cargill, Heinz, Kellogg’s, IFF, and Mars (pet food only) have entered the Indian food-processing industry with significant investments. Indian food and beverage companies are expanding their operations to neighboring countries like Bangladesh, Nepal, Sri Lanka, Commonwealth of Independent States countries, and the Middle East. Takeovers and mergers are beginning to occur in the Indian food-processing sector, leading to consolidation.
Essay # 5. Threats to Indian Food Industry:
Even with import restrictions removed, imports face regulation, taxation and bureaucratic barriers. Import tariffs on consumer food items range from 35 per cent to 56 per cent. Moreover, India’s retail sector is primarily unorganized, and its infrastructure (especially roads and refrigerated cold chains) is underdeveloped. Although imported products are affordable to only approximately 25 per cent of the Indian population, the number of mid- to high-income earners is growing, and they are developing a taste for imported products.
Since 2001, Agri-food imports have increased steadily, rising 14.2 per cent through to 2003, reaching a value of $5.4 billion. Imported processed food products that have had success in this market were typically altered to cater to local tastes-in some cases, regional spices were used to make products more attractive to the Indian market.
Furthermore, smaller packages are offered to accommodate Indian consumers’ limited purchasing power and storage abilities. Examples of processed food items currently imported into India include ketchup, fruit juices, chocolates, biscuits, chocolate syrup, cake mixes, canned soups, popcorn, potato chips, canned fish, ice cream and canned corn.
The food-processing industry in India has undergone sea changes over the last few years, in terms of types, variety, quality, and presentation of products, which is mainly a result of the liberalization that led to foreign direct investment (FDI) in the processed food sectors. The growth in the food-processing sector has generated increased interest in high quality food ingredients in order to produce high quality processed and packaged foods.
The ready-to-eat food sector is growing at a high rate due to the changing lifestyles of the middle-class consumers (both partners working, etc.). Thus increasing number of fast food chains. The recent trend toward a healthier lifestyle has generated a niche market for diet, healthy, low-calorie, and non-fat food products.