Food & beverage sector to touch Rs 4,660 bn by year-end

NEW DELHI: Driven by robust growth in areas like semi-processed, ready-to-eat food and wine, India's food and beverages (F&B) sector is expected to touch Rs 4,660-billion mark by the year-end which is growing at 9 per cent rate, a FICCI survey reveals.

The survey covering 300 sector-specific industry associations and companies projected that segments like semi processed/cooked ready-to-eat, ice-cream, wine and sugar would achieve 24 per cent, 30 per cent, 22 per cent and 25 per cent growth respectively.

The segments which are expected to record high growth between 10-20 per cent includes branded flour atta (16 per cent), bakery items like bread, cakes (11 per cent), biscuits (16 per cent), fruit juices, pulp and concentrates (18 per cent) and sauces/ketchups (17 per cent).

Apart from these, culinary products/snack food, milk products, butter, health beverages, malted food, chocolates, beer, country liquors and branded edible oil are also expected to register excellent growth.

However, items belonging to the unorganised sector which also includes processed food products, flour/atta, bread, milk and dairy products, ghee, sugar, tea, coffee and edible oil is likely to achieve moderate to single digit growth.

"Factors like treating the development of food processing industry as a priority area, changing strategies of companies, changing consumer life style would continue to encourage commercialisation and... demand for value-added food and beverage products," a FICCI statement said.

The survey has also highlighted some of the long-pending demand of the industry like income tax exemption of agriculture and farm produce, cold storage and processing of fruit and vegetables from April 2007 to March 2012.

"The setting up of cold chain and other modernised technology for upgrading of storage handling and transportation should be granted infrastructure status and a 10-year tax holiday should be provided to it," the statement said.

Also, excise duty on all value-added food products like confectionery, innovative Indian ethnic products, high value ready to cook/serve products should be brought down to a maximum of 8 per cent from 16 per cent, it added.

The survey also suggested that "food processing machinery and refrigerated trucks used by processed food industry should be exempt from excise duty and excise on all machineries used for the processed food industry should be lowered to a maximum of 8 per cent".