Changing Trends In The Indian Organic Food Industry

Posted by Organic Team on February 20, 2020

In a previous couple of years, organic products have increased huge ubiquity as the millennial age is progressively getting to be mindful of the geniuses appended to being healthy. The dread of capitulating to sicknesses has enormously driven a union where individuals have begun changing to more beneficial nourishment choices. Natural organic products is delivered by the technique of organic farming which is sustainable for the environment without any compromise in the product quality. The conventional methods of farming usually affect the surroundings with the use of synthetic chemicals. The fact that organic farming methods abandon the use of synthetic chemicals makes this practice environment-friendly.

From newspapers and leisure magazines to several online platforms have invested heavily in creating awareness about “healthy food” in particular. It was only this awareness and enthusiasm that caused a major shift in preferences and churned profits to business in this sector. The factors that contributed deeply to the growth of the organic food industry in India and still continue to do so are, namely: Awareness and demand, the growth of e-commerce, government support, etc. With the advent of technology and the ease of accessing the Internet right at our fingertips, e-commerce websites have changed the shopping scenario in the country. From groceries to medicines, this one-click technology saves a lot of time of the consumers. Recently, significant growth in the e-commerce platforms that deal specifically in organic products has been noted. They provide for consumers to pick the best for themselves as per their affordability and need. 

Though organic food in India is still a niche concept. With the shift of interests of consumers from regular to more healthy and organic products, several brands have dug deep into the roots of Ayurveda. They’ve innovated and created products like food and beverages, cosmetics and personal care items and other healthcare products that are 100% natural. For the investors, this trend is only to accelerate and grow in the near future making it a lucrative sector to invest in. As per an EY Report on Indian Organic Market March 2018, the current Indian domestic market estimated at Rs 40,000 MN is likely to increase by Rs 100,00 MN to Rs 120,000 MN by the year 2020 with the similar increase in exports. Back in the 1990s, Indian Organic tea was exported only to European markets but today, in terms of export of organic products, India is already ranked second largest in Asia after China. With the continuous and rigorous promotion, the Indian Government has managed to encourage farmers to take up organic farming and consumers to opt for more organic food. Different provisions to provide financial assistance to farmers who choose to adopt organic farming is one of the few innovative promotion techniques used by the government. In the Union Budget of 2016, the Government of India proposed to allocate 500,000 in the country under organic farming and develop value chains in the Northeastern Region (NER). The global organic food market stood at $ 110.25 billion in 2016 and is projected to grow at a CAGR of 16.15%, in value terms, during 2017 – 2022, to reach $ 262.85 billion by 2022, as per TechSci’s research report. The government’s incessant support coupled with the increasing export market has made the organic market in India highly successful.

The above-mentioned elements are all major factors that have contributed to the growth of the organic food industry in India. Nonetheless, it is to likewise remember that the expense of operating and producing organic products is higher than the conventional food items available. Besides, these costs are likewise subject to high duty rates in India. It is these higher prices that go about as a hindrance and holds back numerous purchasers to pick natural items; in this manner, the main part of the offer is limited to metro urban areas and stores. Therefore, the higher prices are the only recurring challenge in the path of growth for this industry, for now.