Foreign companies upbeat on Indian processed food market

Dealers Wanted "" read a board at one of the stalls at the food and beverage trade fair, World of Food India 2004. That, incidentally seemed to be the underlying statement here across all the stalls of the foreign companies, who see an enormous opportunity in the Indian processed food market.

The four-day trade fair that has 81 exhibitors "" with 50 being from nine countries including Germany, Thailand, Italy and Malaysia "" brought to the fore the fact that India has become an attractive market for the processed food industry.

"Indians spend the largest part of their salary on food," said R Subramaniam, managing director of Subhiksha Trading Services Private Ltd. Subhiksha runs around 140 food grocery and pharma stores in Tamil Nadu and Pondicherry.

That statement, incidentally, seemed to be the driving force for all the foreign companies, who were out to woo Indian dealers and distributors for a share in the Indian processed food market.

For instance, Singapore-based Fraser and Neave Limited is trying to strike a deal with a Bangalore-based company for locally manufacturing its carbonated drinks.

"Our carbonated drinks that go by the brand name F&N have been in the Bangalore market for about a year now and we would like to locally manufacture these products to tap a greater part of the Indian market," Raphael Tham, manager, corporate planning and business development for Fraser and Neave Limited said.

The company has been selling the drinks in the canned form so far, and is trying to venture into the PET bottle segment as well. "We are also looking for dealers for our ready-to-drink iced coffee, Boncafe icafe, which is a relatively new product in the Indian market," Tham added.

Another Singapore-based company that deals in chocolate, Aalst Chocolate Pte Ltd, has been in talks with two leading Indian biscuit manufacturing companies to provide them with twin chocolate chips for their biscuits.

"Twin chocolate chips are basically chocolate chips in double colours. It is our patented product and we think that manufacturers over here, can use these for decorating the biscuits or as a cookie stuffing," Richard Lee, president and CEO of Aalst, said.

Although Lee refused to divulge the names of the Indian manufacturers that they have been in talks with, Parle and Britannia seem to be the likely companies.

U&I Exim, which deals in exports and imports between the US and India, is trying to rope in dealers for its clients that deal in products ranging from peanut butter to tortillas and salsa.

"So far our clients' products have been in the Indian market at small centres but we are in talks with Big Bazaar and Shoppers' Stop for greater distribution," Jyoti Mujumdar, representative of U&I Exim said.

The German delegation at the fair, also said that they have been visiting supermarkets in the country to see if their products could be sold in the Indian market.

So while foreign companies are trying hard to bank on the potential of the Indian processed food market, what remains to be seen is whether their Indian counterparts are willing to strike deals with them.