Indian nutraceuticals market estimated to be USD 1 billion
Of the global nutraceuticals market of USD 117 billion, India has less than one per cent share. Globally, this market is expected to reach USD177 billion in 2013, at a CAGR of seven per cent driven by the fast growing dietary supplements category.
INDIAN NUTRACEUTICALS market is estimated to be USD one billion. While the global market is growing at a CAGR of seven per cent, the Indian market has been growing much faster at a CAGR of 18 per cent per cent for the last three years, driven by functional food and beverages categories. However, the latent market in India is two to four times the current market size and is between USD two to USD four billion with almost 148 million potential customers, states the FICCI - Ernst & Young study titled ‘Nutraceuticals - Critical supplement for building a healthy India’ released at the FICCI and Health Foods and Dietary Supplements Association conference.
Of the global nutraceuticals market of USD 117 billion, India has less than one per cent share. Globally, this market is expected to reach USD177 billion in 2013, growing at a CAGR of seven per cent driven by the fast growing dietary supplements category.
As a concept, ‘Nutraceuticals’ is in its stage of infancy with several developed countries having defined it only in last 15 years. With more than forty per cent deaths in developing countries attributable to risk factors linked to nutrition, nutraceuticals are gaining momentum.
As a concept, ‘Nutraceuticals’ is in its stage of infancy with several developed countries having defined it only in last 15 years. With more than forty per cent deaths in developing countries attributable to risk factors linked to nutrition, nutraceuticals are gaining momentum.
Nutraceuticals can be broadly categorised as products which are extracted from natural sources (nature-like) or manufactured synthetically (man- made), which supplement the diet to provide nutrition over and above regular food and help prevent nutrition related disorders.
On the launch of the report, Muralidharan Nair, Partner - HealthSciences Practice, Ernst & Young, stated, "Nutrition care, which forms an integral part of preventive healthcare, is undergoing a transformation in India. The FICCI-EY study discusses the current market size and latent potential of the nutraceuticals market in India, critical impediments to convert latent opportunity into a market and the future imperatives for the government and private sectors."
Sushil Jiwarajka, chairman FICCI's Western Regional Council said, "There are 0.18 million food processing units and seven million retail outlets. However, the country has only 2000 food safety officers and 250 food sample testing laboratories, which is not at all sufficient. In fact, it is well below international norms. India therefore needs to take immediate action to increase the number of testing laboratories and food safety officers so that the country is well prepared to enforce the regulations after these are established in the near future. The need of the hour is to develop clinical documentation and scientific basis to support claims of safety and efficacy. Support for backward integration is a necessity."
The report states that factors such as affluence of working population with changing lifestyles, reducing affordability of sick care that is driving consumers towards wellness, increasing physician awareness and media penetration and increased accessibility due to newer distribution channels, are driving the domestic growth of the nutraceuticals market.
The report underscores the untapped potential of the latent nutraceuticals market in India and factors impeding growth of this market including regulatory framework not yet implemented, inadequate resources for implementation of regulations, high prices of nutraceuticals and lack of credibility of nutraceuticals.
India market
Indian nutracueticals market in 2008, is estimated at USD 1.0 billion. Of this the functional foods market is the largest with 54 per cent market share followed closely by the dietary supplements market which has a 32 per cent market share. The functional beverages market in India is relatively nascent at 14 per cent. The functional food and beverages categories consisting of nutrition fortified foods, sports and energy drinks, fortified juices and probiotic foods are growing faster, driven by wider distribution across FMCG channels as well as aggressive mass marketing.
The Indian nutraceutical market is dominated primarily by pharmaceuticals and FMCG companies with very few pure play nutraceutical companies. Pharmaceutical and FMCG players' active in the nutraceuticals space have diversified by introducing product extensions and developing variants under existing brand names. Many new players have announced aggressive investment plans.
India facts
Various risk factors related to health result from an imbalance in nutrition. Such imbalances in India are widely prevalent leading to adverse outcomes. These adverse outcomes are estimated to cost nearly one per cent point to India's GDP and so improvement in nutrition status is a critical part of the country's agenda for progress. An estimate of the cost of nutrition related disorders was 0.85 per cent of the GDP in 2004, and is expected to increase up to 1.2 per cent of India's GDP by 2015.
Analysis of India's dietary intake reveals nutritional imbalances across most segments of population The report states that majority of the undernourished population (380 million) faces a challenge to meet foundation needs to maintain normalcy of being. There is a huge population (570 million) that is nourished in calorie intake but not in terms of nutrient intake. They face the challenge of preventing condition specific needs in addition to foundation needs and could be the largest contributor in making India the future cardiovascular and diabetes capital of the world. There is another population segment (80 million) which consumes nutrients and calories more than norm due to their enhanced physical requirements.
India capitalising opportunities
In order to tap a huge latent potential market and to pave the way for nutraceuticals to supplement India's quality healthcare agenda, the government should lay down rules to govern quality and claims of nutraceutical products. To ensure implementation of these rules, the government should ensure availability of resources. Encouraging R&D in the field of nutrition and deploying PPP models to serve needs of the undernourished segment of population will further boost sector growth
The private sector as well has a significant role to play. Companies should focus on developing customer focused products addressing specific needs of different consumer segments. It is important for players to create product differentiation by credibility building and/ or lowering prices of products. Product promotion to increase awareness of the benefits of nutraceuticals through advertising and physician.
On the launch of the report, Muralidharan Nair, Partner - HealthSciences Practice, Ernst & Young, stated, "Nutrition care, which forms an integral part of preventive healthcare, is undergoing a transformation in India. The FICCI-EY study discusses the current market size and latent potential of the nutraceuticals market in India, critical impediments to convert latent opportunity into a market and the future imperatives for the government and private sectors."
Sushil Jiwarajka, chairman FICCI's Western Regional Council said, "There are 0.18 million food processing units and seven million retail outlets. However, the country has only 2000 food safety officers and 250 food sample testing laboratories, which is not at all sufficient. In fact, it is well below international norms. India therefore needs to take immediate action to increase the number of testing laboratories and food safety officers so that the country is well prepared to enforce the regulations after these are established in the near future. The need of the hour is to develop clinical documentation and scientific basis to support claims of safety and efficacy. Support for backward integration is a necessity."
The report states that factors such as affluence of working population with changing lifestyles, reducing affordability of sick care that is driving consumers towards wellness, increasing physician awareness and media penetration and increased accessibility due to newer distribution channels, are driving the domestic growth of the nutraceuticals market.
The report underscores the untapped potential of the latent nutraceuticals market in India and factors impeding growth of this market including regulatory framework not yet implemented, inadequate resources for implementation of regulations, high prices of nutraceuticals and lack of credibility of nutraceuticals.
India market
Indian nutracueticals market in 2008, is estimated at USD 1.0 billion. Of this the functional foods market is the largest with 54 per cent market share followed closely by the dietary supplements market which has a 32 per cent market share. The functional beverages market in India is relatively nascent at 14 per cent. The functional food and beverages categories consisting of nutrition fortified foods, sports and energy drinks, fortified juices and probiotic foods are growing faster, driven by wider distribution across FMCG channels as well as aggressive mass marketing.
The Indian nutraceutical market is dominated primarily by pharmaceuticals and FMCG companies with very few pure play nutraceutical companies. Pharmaceutical and FMCG players' active in the nutraceuticals space have diversified by introducing product extensions and developing variants under existing brand names. Many new players have announced aggressive investment plans.
India facts
Various risk factors related to health result from an imbalance in nutrition. Such imbalances in India are widely prevalent leading to adverse outcomes. These adverse outcomes are estimated to cost nearly one per cent point to India's GDP and so improvement in nutrition status is a critical part of the country's agenda for progress. An estimate of the cost of nutrition related disorders was 0.85 per cent of the GDP in 2004, and is expected to increase up to 1.2 per cent of India's GDP by 2015.
Analysis of India's dietary intake reveals nutritional imbalances across most segments of population The report states that majority of the undernourished population (380 million) faces a challenge to meet foundation needs to maintain normalcy of being. There is a huge population (570 million) that is nourished in calorie intake but not in terms of nutrient intake. They face the challenge of preventing condition specific needs in addition to foundation needs and could be the largest contributor in making India the future cardiovascular and diabetes capital of the world. There is another population segment (80 million) which consumes nutrients and calories more than norm due to their enhanced physical requirements.
India capitalising opportunities
In order to tap a huge latent potential market and to pave the way for nutraceuticals to supplement India's quality healthcare agenda, the government should lay down rules to govern quality and claims of nutraceutical products. To ensure implementation of these rules, the government should ensure availability of resources. Encouraging R&D in the field of nutrition and deploying PPP models to serve needs of the undernourished segment of population will further boost sector growth
The private sector as well has a significant role to play. Companies should focus on developing customer focused products addressing specific needs of different consumer segments. It is important for players to create product differentiation by credibility building and/ or lowering prices of products. Product promotion to increase awareness of the benefits of nutraceuticals through advertising and physician.
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