India’s Shift in Eating Habits Boosts Food Processing Industry

World Food Safety Day is celebrated every year on June 7th. This day reminds us of the importance of safe and healthy food. Unhealthy food can lead to various diseases, which is why the World Health Organisation (WHO) and the Food and Agriculture Organization (FAO) jointly organise World Food Safety Day.

Let’s try to understand the food safety scenario and the food industry in India.

What’s Happening?

On May 29th, the International Food Policy Research Institute (IFPRI) released the Global Food Policy Report 2024. It found that 38% of Indians consume fried snacks and processed foods, while only 28% consume healthy food.

Talking about the Indian food industry, India’s food and grocery market is the sixth largest in the world, with the food processing industry contributing 32% to it. This industry is one of the largest sectors in the country, accounting for 13% of total exports and 6% of industrial investment.

Changing Eating Habits

There has been a significant shift in eating habits in many countries, including India, which is not beneficial for health. As a result, the problem of malnutrition is growing. Additionally, the risks of weight gain and diseases are also increasing.

According to the Global Food Policy Report, the number of malnourished people increased from 15.4% to 16.6% between 2011 and 2021. The number of obese adults rose from 12.9% in 2006 to 16.4% in 2016.

Interestingly, spending on eating out and packaged foods is also rapidly increasing. Some studies suggest that spending more on packaged foods leads to less consumption of fruits and vegetables, further increasing the risk of nutritional deficiencies and diseases.

What Does This Mean for Investors?

There are numerous investment opportunities in the food processing industry in India. As we know, unhealthy eating habits are common in India. People often consume cheap and easily available processed foods, which can be harmful to their health. This is why the demand for healthy and safe food options is rapidly increasing, presenting a significant opportunity for the food processing industry.

What’s Next?

According to the India Brand Equity Foundation (IBEF), considering India’s growing population, changing lifestyles, and eating habits, the food processing industry’s market size is expected to grow from $866 billion in 2022 to $1,274 billion by 2027. The rise in disposable income and urbanisation is also accelerating the growth of this sector.

The Indian government is also promoting the food processing industry. In the interim budget for FY2024-25, a total budget of Rs 3,290 crore (~$396 million) was allocated to the food processing industry, which is about 13% higher than the revised estimates for FY24.

That’s it for today. We hope you’ve found this article informative. Remember to spread the word among your friends. Until we meet again, stay curious!

The article is for information purposes only. This is not an investment advice. Disclaimer: Teji Mandi Disclaimer