Young, developing pasta market in India should not be ignored: Analyst

By Kacey Culliney

- Last updated on GMT

Indian pasta industry set to grow steadily, providing opportunities
Indian pasta industry set to grow steadily, providing opportunities

Related tags Local food Economics

The Indian market for pasta is set to develop and strengthen, offering opportunities for international manufacturers, according to industry analyst.

The Indian pasta market could increase revenue and enable companies to geographically diversify amid a downturn in demand for pasta in Western Europe.

Francisco Redruello, senior foods analyst at Euromonitor International, said: “By and large, pasta continues to be a relatively foreign concept in India. The increasing popularity of Western lifestyles among middle-class consumers, however, could prove an opportunity for significant expansion over the medium to long term.”

Redruello said that the foundations are in place for a growing demand for pasta in the coming years.

He explained that economic growth, continued exposure to Western cuisine via media and travel and an increasing demand for convenience foods among middle-class Indian consumers could combine to create a surge in the market.

Tapping into the market

Redruello identified two ways in which manufacturers can tap into the Indian pasta market.

One entry area would be to enter the lower end of the market with standard priced pasta lines, keeping costs minimal with use of local inputs, he said.

He added: “Crucially, an alliance with local food manufacturers through co-branding strategies would allow them [manufacturers] to further minimise the cost of their investment.”

Alternatively, Redruello said that manufacturers can tap into the market on a premium level, selling produce in specialist stores located in wealthier, urban areas.

He explained that the introduction of premium chilled pasta lines that target affluent and well-travelled consumers could work to open up a new growth niche for international players.

Redruello added that if manufacturers choose the premium market, they should avoid any strategic partnerships with local manufacturers.

He explained: “Co-branding or other forms of strategic partnership between international and local manufacturers in the upper-price segment would likely be less successful than when employed for lower and middle retail price brackets. This is because more premium-minded consumers in developing markets are typically happy, and able, to pay higher prices for imported brands, which often carry an aura of quality that locally-produced offerings lack.”

Premium promises

Redruello said: “Demand for pasta is still very low among Indians and is mostly restricted to upper-income consumers in urban areas….pasta is considered a luxury in the country and is eaten only on an occasional basis.”

The premium end of the pasta industry within India has great potential for expansion, he added.

Redruello noted that local manufacturer Bambino Agro Industries Ltd’s pasta line has seen a steady increase in sales over the past year and targets busy professionals willing to pay a premium for convenience foods.

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