Food and agribusiness to India
Australia’s ‘clean, green’ foods have a great brand reputation in India. There are also improved prospects for finding new customers, with an increase in e-commerce channels and supermarkets.
Pulses and grains dominated Australian agri-exports in the past. However, changes to consumer spending is creating fresh demand and new ways of going to market.
- Indian food-processing companies are looking for partners to deliver high-quality produce.
- Tight regulation on wholesale markets is being relaxed. This is creating opportunities in logistics and warehousing.
- India is becoming more receptive to Australian agtech, especially grain-tech.
- Agriculture policy reform is triggering opportunities in research, warehousing and logistics.
Read our Agtech to India export market profile.
India’s emerging middle class has a taste for imported fruit and vegetables. The value of food imports tripled in the last decade, from A$2.4 billion in 2009 to A$7.5 billion in 2019 (Source: Department of Foreign Affairs and Trade, An Indian Economic Strategy to 2035, Agribusiness Sector, 2018).
- growing demand for year-round fresh fruits and vegetables
- Australian exporters can get fresh produce to market in 21–26 days, faster than 40 days from competitors in the United States of America (USA)
- Austrade is working with peak bodies to build exports of stone fruits. This includes peaches, plums and cherries
- e-commerce is expanding demand for imported fruit, and creating new distribution channels.
Health and beauty
Indian consumers appreciate Australian health and beauty products, and their reliable manufacturing standards.
- demand for nutritional supplements triggered by lifestyle changes
- rapid growth of e-commerce is enabling brands to connect directly with consumers
- natural products account for close to one-third of the personal care category
- Australian brands have a strong reputation among India consumers, who trust Australian standards.
Lamb is a large opportunity in India.
- lamb is becoming popular in hotels and restaurants
- Australian lamb is mostly sold via food service channels, where lamb racks are popular
- lamb sales are expected to grow as more Indians increasingly dine out
- growing demand for imported carcasses for processing.
India is a small market for wine but has long term growth potential for Australian wine and other alcoholic beverage exporters. India’s total value of imported wine was just $A31 million in 2019. Australia’s share of this was around A$7 million. (Source: Trade Map, International Trade Centre (2020), accessed 23 March 2021.)
- there is increased wine consumption due to culture change, tourism, returned students and rapidly changing demographics
- Australian winemakers can engage at a mid-tier price level
- imported wine is a status product because of high tariffs and the perceived quality of domestic wines
- online wine sales in major cities provide a major new route to market
- sales via hospitality venues will likely increase quickly post-COVID-19.
There is demand for international foodstuffs among India’s large middle class.
- regulations on imported foods have eased. Logistics have improved
- demand for gourmet produce is rising. This includes via chains such as Foodhall, Le Marche and Spencer Natures Basket
- wealthy consumers are turning to health foods. This includes gluten-free, sugar-free and plant-based products.
Demand for dairy goods is growing, despite tariffs and regulation. Australian dairy has a great reputation. This is due to Australia’s safe and reliable manufacturing standards.
- growing demand for cheese and cream in hospitality, food service and retail sectors
- Australia continues to export skimmed milk powder within government quotas. This restricts imports from private Indian players and is often based on shortages in the market
- there will be opportunities for value-added dairy products as demand for healthier products grow. This includes fortified milk or A2 milk from Australia
- imports to India currently include milk powder, fats and oils, casein, butter, whey, cheese, lactose.
There is a currently a strong consumer focus on health. This is driving consumption of plant-based alternatives to animal protein. This is sometimes called ‘smart meat’. It is currently a niche market in India.
Consumers’ focus on health may be due to many factors, including:
- the COVID-19 pandemic
- social media influencers
- animal rights activists
- growing environmental awareness.
Whey protein concentrates and lactose
There is an increase in demand in India for whey protein concentrates and lactose.
This may be due to:
- a growing number of fitness centres
- booming social group activities like cycling, running and adventure sports.
India’s agriculture sector is on the cusp of a digital technology revolution. This includes:
- Agriculture 4.0
- Internet of Things
- artificial intelligence
There is also rapid growth in:
- the number of agtech and foodtech start-ups
- mobile technology penetration in the farming value chain.
There are also important changes to India’s agriculture marketing policy. The policy changes may create opportunities including:
- bulk grain management and logistics
- intensive horticulture production systems.
Read our agtech to India profile.
There are tariff barriers for most food and wines. Regulatory barriers and distribution can also be difficult. For example:
- average tariffs for processed food, pulses and grains are high
- there is a lack of cold chain, however logistics have recently improved
- most retailers prefer a shelf-stable product from Australia
- there is strong competition from USA and European Union producers
- there is strong price competition from domestic suppliers. Imports need to compete on quality.
Many Australian companies have discovered new paths to India’s food and beverage markets in the past two years. Read their stories:
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