Health increasingly means wealth for food-processing companies in India. Obesity may be seen as a Western problem but, in the more affluent parts of this fast-developing country, it is becoming a growing concern.
As such, there is expected to be growing demand for healthier food products. Management consulting firm Tata Strategic Management Group (TSMG) has estimated the current worth of the health and wellness foods market in India at INR101.5bn (US$2.3bn) and see it potentially rising at a compounded annual growth rate of 23% to INR550bn, or $12.49bn, by 2015. Market penetration, advances in product development and Indian government-mandated nutrient fortification were all reasons for the increase, the report said.
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“Indian consumers are increasingly open to the benefits provided by health and wellness foods. Therein lies the opportunity that Indian food and beverage companies could leverage to create large packaged food brands in India,” TSMG chief executive Raju Bhinge says.
And so Indian and multinational food manufacturers have been busy launching new lines. Himalya International launched a natural fruit yoghurt in India earlier this year. Parle Products, an Indian major in snacks, biscuits and cookies, launched the “baked not fried” Smart Chips in 2009, with a catchy television commercial featuring film star Aamir Khan offering oversized T-shirts with the message “you will need it” to people munching chips. Smart Chips came close on the heels of Aliva, a baked snack from PepsiCo’s snack division, Frito-Lay.
The Indian market is young – the median age is 25 years – net savvy and health conscious. It seeks an easy route to health rather than a lifestyle change. Eating healthier food is one such route.
This is the reason for a recent marketing slogan used by biscuit maker Britannia Industries. ‘Swasth Khao, Tan Man Jagao‘ or ‘Eat healthy, rejuvenate mind and soul’ was used to launch NutriChoice, a range of high-fibre, five-grain and naturally spiced biscuits earlier this year. Anuradha Narasimhan, category director, health and wellness, at Britannia Industries says: “We believe the health and wellness category in India is poised for an explosion.”
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By GlobalDataBritannia moved to has take unhealthy ingredients out of its products and add in healthier nutrients. “We were the first bakery company in India to proactively remove trans-fats from our portfolio,” Narasimhan notes. “Over 99% of the Britannia portfolio is trans-fat free, and over 55% is fortified – the lead brands being Tiger, Milk Bikis, MarieGold and Britannia Breads.”
For calorie-conscious dairy consumers, Britannia has introduced Slimz cheese with 33% lower fat than other cheeses in the market, Slimz milk (0.5% fat and no cholesterol) and a low-fat curd variant with only 1.5% fat. “The Slimz variants contribute to approximately 10% of the respective categories,” Narasimhan says.
Nestle has used health in its marketing in India since 2005 – its slogan being ‘Taste Bhi Health Bhi‘ or ‘taste as well as health’ – and it has also developed a range of products. The Swiss food giant has enriched its flagship product Maggi noodles with protein and calcium and rolled out Maggi vegetable atta (wheat flour) noodles. Other new products from Nestle include Maggi Multigrainz noodles with ingredients such as corn, ragi and jowar millets, wheat and vegetables; healthy soups; and Maggi Pazzta made from semolina.
According to the TSMG report, curd or yoghurt, flour, savoury snacks, and edible oils are likely to be the top five fastest-growing food categories in India by 2015. Already, Hindustan Unilever and ITC (which has diversified into food and other industries), to name two companies, are present in the fortified atta (wheat flour) segment.
With an annual per capita consumption of edible oil in India standing at 12kg, the fortified edible oil segment is attractive to food manufacturers. ITC’s Ashirwad multigrain atta includes different grains, such as wheat, soya, oat, maize and psyllium husk that provide vitamins and help digestion. Meanwhile, US-based food giant Cargill’s wholly-owned Indian subsidiary has introduced Gemini, a refined cooking oil fortified with Vitamins A, D and E, that is supposed to help prevent vitamin deficiency.
Food manufacturers in India are keen to stress that price should not be a barrier to healthier products. Himanshu Manglik, a spokesperson for Nestle India, says: “With economic growth and changing lifestyles, India will be challenged by the need for better nutrition across the income pyramid. Meals affordable by a large number of Indian consumers do not provide all the relevant nutrients. Studies show in India the micronutrient deficiencies of serious concern include iron, iodine and vitamin A.”
This is something that Indian consumers are aware of, with cost-conscious Indians checking labels for content as well as the retail price, says Shalin Desai, senior brand manager at Parle Products. “Our healthy snack-food range is priced competitively to ensure a large set of our consumers can opt to buy Smart Chips,” he says. The urban Indian is willing to pay more to ensure health but, as Britannia’s Narasimhan notes: “Price will play a key role in the trial-and-adoption cycle.”
Health consciousness amongst Indian food consumers is also moving from the major cities such as New Delhi and Mumbai to smaller cities, such as Agra or Pune. Here, consumers have less money. Nestle has launched Maggi Masala-ae-Magic, a taste enhancer fortified with iron, iodine and vitamin A to capture this poorer health-conscious consumer market. Priced at INR2 or 4.5 US cents, the product is affordable for lower-income families.
Man Mohan Malik, chairman and managing director of Himalya International, says healthy food should not be expensive. “Traditionally, Indians have consumed millets – poor man’s cereals – and bran in their regular diet. Why should they cost more now? Consumers need to rethink what is healthy.”
And there is work to be done. The most recent National Family Health Survey, conducted in 2005–2006, revealed 20% of schoolchildren were overweight. However, the survey also found a high prevalence, 70%, of anaemia in children under five.
Most Indian women and men suffer either from over-nutrition or under-nutrition, with more than one-third of women and men being too thin. Obesity is more common in the cities, among highly-educated and well-to-do adults, 12.6% women and 9% men were overweight or obese according to this national survey.
Given India has this problem of under and over nutrition, unheard of in rich Western markets, food companies can offer higher-fat products as having at least a neutral role in health terms. For instance, Nestle’s milk in India ranges from rich and creamy milk, half-fat milk, Nestlé Slim (skimmed milk) to Pro-Heart Milk.
As with many elements of India’s food industry, the health and wellness sector is dynamic, in some ways unique to the country and promises further growth in the years ahead.
