Urban households in India fuelling packaged food sales

Households with working couples and young children, serve on an average 10-12 such meals a month, found a study


Indian shoppers spent most on dairy products, pastas, ketchups, jams, baby food, and buy more beverages and frozen foods as part of their groceries. Photo:
Indian shoppers spent most on dairy products, pastas, ketchups, jams, baby food, and buy more beverages and frozen foods as part of their groceries. Photo:

Bengaluru: More households in urban India have been associating ready-to-eat food with convenience, fuelling the sale of packaged food at an average annual rate of 32.5% between 2010 and 2015, says a study by industry body Associated Chambers of Commerce of India released on Sunday.

Rising disposable income and a younger demography of households in the top metros also mean that over the next two years consumption will surge across categories of packaged food such as packaged beverages, dairy products, snacks and baked foods at an annual rate of 35% to $50 billion from the current $32 billion, the report said. Urban households account for 80% of such purchases.

More parents are opting for easy-to-prepare meals. The report says households with working couples and young children, serve on an average 10-12 such meals a month. About 76% of the nuclear families feel that they have less time to spend in the kitchen.

Indian shoppers spent most on dairy products, pastas, ketchups, jams, baby food, and buy more beverages and frozen foods as part of their groceries.

More packaged food and beverage companies have announced investments in India amid a rise in younger population—the largest in the world (according to the United Nations)—who are expected to spend more on out-of-home consumption of food and other products.

In 2013, PepsiCo’s global chief Indra Nooyi promised investments of Rs.33,000 crore by 2020, giving the food and beverage maker more scope to grow its Kurkure and other snack brands.

However, the news of a proposed 40% sin tax, a provision of the proposed Goods and Service Tax, on sugary, aerated soft drinks has dampened investment sentiment in the market. Beverages major Coca-Cola India on 11 December said that it will have to shut down factories in India if the government accepts the proposal.

READ MORE