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Non-alcoholic beverages sector adds Rs 7,91,599 mn value, over 6,90,000 jobs: Report

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New Delhi, May 27 (Ajit Weekly News) The non-alcoholic beverages sector added Rs 7,91,599 million value to the Indian economy and created an estimated 6,91,491 jobs, a report released on Friday said.

The report, ‘Contribution of Non-Alcoholic Beverages Sector in Indian Economic Growth and #AtmanirbharBharat’ was released by Food and Public Distribution Secretary Sudhanshu Pandey, at an event organised by the Indian Beverage Association, wherein he highlighted the need to reduce wastage of fruits and making Indian beverage industry competitive while matching the global quality standards in the sector.

Noting the requirement of a holistic eco-system including a specialised logistics chain management system for better efficiency and productivity in the sector, he also drew attention towards the opportunities for generation of employment in rural areas and potential for investment in a diversified manner throughout the country.

The report, which seeks to understand the contribution of the sector towards the Indian economy, examine the strengths and best practices, identify challenges and suggest a way forward to make India one of the world’s leading beverage processing hubs, found that the non-alcoholic beverage sector contributes significantly to the Indian economy in terms of value addition and job creation. The Input-Output model estimated that for every Rs one crore of output produced in the non-alcoholic beverage sector, a total of 8.9 additional jobs are created in the economy due to both the direct as well as indirect impact, the report said.

However, it also pointed out that employment creation is still below potential, as processing is much lower than in other developing countries in the ASEAN or in China. Foreign investment inflows are below one per cent and exports are much behind what is required for India to become a $17 trillion economy by 2047, it said.

The global non-alcoholic beverage market was worth $1,180 billion in 2020 and is projected to reach $2,175 billion in 2026, with a compound annual growth rate of 7.3 per cent.

In 2019, India ranked 19th, much below other developing countries such as Mexico (6th), Brazil (7th), Indonesia (8th) and Nigeria (10th). Global trade was $77.36 billion in 2019. Over 60 per cent of the global market was accounted for by carbonated soft drinks (CSDs), ready-to-drink (RTD) tea/coffee, energy drinks and sports drinks.

The per capita consumption of CSDs is lower in India compared to other countries such as the US. Mineral water (packaged drinking water/natural mineral water) has the highest growth projection in Asia, with India being one of the largest markets, the report highlighted.

The report also pointed to the top four challenges to the growth of this sector. These are unfair competition from the unorganised sector and counterfeit products, negative perception regarding the industry, high goods and services tax (GST) and additional “sin tax” (as applied based on the Subramaniam Committee Report) and infrastructure related issues.

–Ajit Weekly News

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