Tuesday, February 24, 2015 08:00 IST
Libin Chacko Kurian and Rashmi Nair, Mumbai
With lifestyle diseases and conditions like hypertension and diabetes experiencing an exponential rise in the country, more and more Indians are opting for healthier options such as fruit juices, fruit-based drinks and nectars.
While, traditionally, the market of fruit juice has been dominated by the unorganised sector, and offerings belonging to the branded, organised sector have been very few, the latter has been showing consistent high growth both in terms of volume and market share for the last few years.
Tax concessions
Not only that, government support in the form of tax concessions is buoying growth in the sector compared to other sub-segments of the beverage sector. For instance, concession in tax that is being given to fruit juices is not being given to other non-alcoholic beverages. This could be because these beverages are considered healthy.
While aerated beverage products are taxed at 20%, fruit juices are taxed at a concessional rate of 12.5%. This helps both the producers of fruits and consumers. While it creates better market for farmers growing fruits, consumers are getting nutritionally rich products for consumption. Tax concessions also mean more investments by both big players and regional small players. Thus the sector keeps experiencing consistent growth and in years to come may leave other key beverage sub-segments far behind in business expansion.
Minuscule compared to West
Indian fruit juice segment is poised for 30% growth in next 5 years, according to a study published by International Research Journal of Commerce, Arts and Science titled Consumer Behaviour for Fruit Juice Market in India, published in 2013. The study reads “India produces about 9 million tonne of fruits every year, growing at a rate of 12% per annum. The total market for fruit juices is 230 million litre which includes both packed and freshly made fruit juices. The proportion of packed fruit juices is small at just 3.4 million litre just over 1% of market. But even this huge volume translates to just 20 ml per capital consumption as against 45 litre in Germany, 42.5 litre in Switzerland and 39 litre in USA.”
Prashant Chaturvedi, director, Sunrise Agriland Development (a major exporter of fruit juices), explained, “Fruit juices are fast moving beverages due to convenience and nutritional peculiarities. A health-conscious population growing in both rural and urban parts of India, even when they look for convenience foods to escape long meals, they still go for better nutrition.
He added, “Beverages are the most convenient form of consumption, in which fruit juices are the nutritious and healthy choice for consumers. The medicinal advantage of fruits are the most important driving force in the beverage market. No other beverage can copy that natural nutraceutical specialty of fruits. Different fruits have different nutritional combination and can be used for specific nutrition. The market is expanding into different parts of the country.”
read more
Libin Chacko Kurian and Rashmi Nair, Mumbai
With lifestyle diseases and conditions like hypertension and diabetes experiencing an exponential rise in the country, more and more Indians are opting for healthier options such as fruit juices, fruit-based drinks and nectars.
While, traditionally, the market of fruit juice has been dominated by the unorganised sector, and offerings belonging to the branded, organised sector have been very few, the latter has been showing consistent high growth both in terms of volume and market share for the last few years.
Tax concessions
Not only that, government support in the form of tax concessions is buoying growth in the sector compared to other sub-segments of the beverage sector. For instance, concession in tax that is being given to fruit juices is not being given to other non-alcoholic beverages. This could be because these beverages are considered healthy.
While aerated beverage products are taxed at 20%, fruit juices are taxed at a concessional rate of 12.5%. This helps both the producers of fruits and consumers. While it creates better market for farmers growing fruits, consumers are getting nutritionally rich products for consumption. Tax concessions also mean more investments by both big players and regional small players. Thus the sector keeps experiencing consistent growth and in years to come may leave other key beverage sub-segments far behind in business expansion.
Minuscule compared to West
Indian fruit juice segment is poised for 30% growth in next 5 years, according to a study published by International Research Journal of Commerce, Arts and Science titled Consumer Behaviour for Fruit Juice Market in India, published in 2013. The study reads “India produces about 9 million tonne of fruits every year, growing at a rate of 12% per annum. The total market for fruit juices is 230 million litre which includes both packed and freshly made fruit juices. The proportion of packed fruit juices is small at just 3.4 million litre just over 1% of market. But even this huge volume translates to just 20 ml per capital consumption as against 45 litre in Germany, 42.5 litre in Switzerland and 39 litre in USA.”
Prashant Chaturvedi, director, Sunrise Agriland Development (a major exporter of fruit juices), explained, “Fruit juices are fast moving beverages due to convenience and nutritional peculiarities. A health-conscious population growing in both rural and urban parts of India, even when they look for convenience foods to escape long meals, they still go for better nutrition.
He added, “Beverages are the most convenient form of consumption, in which fruit juices are the nutritious and healthy choice for consumers. The medicinal advantage of fruits are the most important driving force in the beverage market. No other beverage can copy that natural nutraceutical specialty of fruits. Different fruits have different nutritional combination and can be used for specific nutrition. The market is expanding into different parts of the country.”
read more
