The Indian market for beverages
India belongs to the fastest growing economies in the world. Today India is the ten largest economy and the second largest producer of agricultural commodities worldwide.

Due to the extraordinary developments in all important industrial sectors, the demand for machinery and equipment has grown rapidly within the last ten years - a demand that can not be met exclusively out of India's production.

Despite a considerable increase in the supply provided by local food processing and packaging machinery manufacturers, there is a high demand for foreign machinery featuring state-of-the-art technology. In particular companies producing food and beverages not only for the local market but for export, purchase imported machinery. For the manufacturers of food processing and packaging machinery, India has become a very important market in Asia with strong growth potential.

In 2010 the Indian imports of food processing and packaging machinery increased again by 14 percent and amounted to 560 US $ million. With a market share of 19 percent Germany belongs to the most important supplying countries after Italy which has a market share of 22 percent. Other supplying countries are China, the United States and United Kingdom.

Exports of food processing and packaging machinery to India in US $ million

	2006	2007	2008	2009	2010	Growth rate 2010/2006
Total exports	291	420	546	519	599	105,84
Italy	54	100	108	119	114	111,11
Germany	61	72	128	73	91	49,18
China	13	27	39	48	67	415,38
United States	30	39	60	33	54	80,00
United Kingdom	31	30	37	36	46	48,39

Source: National statistics of 43 industrial countries, VDMA

Non alcoholic beverages
The soft drinks industry in India comprises over 100 plants across all states. It provides direct and indirect employment for over 125.000 employees. It has attracted one of the highest foreign direct investments in the country.

Soft drinks constitute the third largest packaged food segment in India after packaged tea and packaged biscuits. But the penetration level of soft drinks in India is still low compared with other developing markets, an indication for further potential for rapid growth.
The market size for soft drinks in India has been estimated at 3.108 US $ million in 2010. With an annual growth rate of 16.5 percent volume sales of bottled water will increase rapidly within the next five years. The volume sales of carbonated soft drinks will increase by 8.6 percent per year. The market size for juice will grow most dynamically within the next five years with an annual volume sales growth rate of almost 22 percent. Increasing demand for healthy and hygienic products is expected to fuel the growth of the soft drink sector. Increasing penetration in rural areas will also contribute to considerable sales increments.

Sales volume of non alcoholic drinks in India

Litres mn	2011	2012	2013	2014	2015	Annual growth rate 2011-2015
Bottled water	4.754	5.647	6.647	7.692	8.753	16,5 %
Carbonated soft drinks	1.809	2.000	2.187	2.361	2.514	8,6 %
Juice (fruit/vegetable)	734	9.001	1.100	1.334	1.608	21,7 %

Source: Euromonitor International 2011

Alcoholic beverages
India is one of the largest markets for alcoholic beverages in the world. In Asia the country is the third largest sales market after China and Japan. Although India has been rather a market for rum and whiskey for a long time, beer is becoming more popular, in particular among the young, affluent people. The sales volume of beer amounted to 1.382 million litres in 2010. The annual growth rate of beer volume sales will reach 12 percent until 2015.

Sales volume of alcoholic drinks in India

Litres mn	2011	2012	2013	2014	2015	Annual growth rate 2011-2015
Beer	1.562	1.757	1.968	2.196	2.439	11,8 %

Source: Euromonitor International 2011

Milk
Unlike most other Asian countries, dairy products are a well-established part of the national diet in India. With an annual output of more than 110 million tons, India is the largest milk producer in the world. Currently, only 13 percent of the milk is processed. 85 percent is distributed by the unorganised sector, but the organised sector is growing rapidly.

Within the next years the demand for packaged milk and milk products will increase because the growing middle class health-conscious consumer segment– especially in towns and cities – turns towards the western way of life and thus requires more and more processed and packaged food in modern supermarkets. The availability of fresh/pasteurised and long life/UHT milk increases across the country.

Sales volume of drinking milk product in India

in 1.000 tons	2011	2012	2013	2014	2015	Annual growth rate 2011-2015
Drinking milk products	12.648	13.496	14.336	15.158	15.952	6 %

Source: Euromonitor International 2011

For further information please contact:
VDMA
Food Processing and Packaging Machinery Association
Beatrix Fraese
beatrix.fraese@vdma.org