The
present
India’s
3m tonne bakery products industry can be categorised into the three
broad segments of bread, biscuits and cake. Only 40 per cent of the
bakery industry is in the organised sector, while the balance comprises
of unorganised, small-scale local manufacturers. There are over 2m manufacturing
units in the unorganised segment.
While the
unorganised sector manufactures several “types” of bread, the organised
sector primarily concentrates on the manufacture of “western” types
of breads. While the bread types are still limited, bis-cuits, which
have been popular for very long now, provide a wide range of variety,
both in terms of quality and taste. But cakes have not yet hit the popularity
charts and are limited in range in select local markets.
As per
estimates of the Ministry of Food Processing Industries (1998), the
total market of bread and biscuit is estimated at 1.5m tonnes and 1.1m
tonnes respectively. The cake market is estimated at 0.4m tonnes. The
organised segment of the biscuit market is estimated to be 0.44m tonnes,
whereas the unorganised sector accounts for the balance 0.66m tonnes.
Over 80% of bread is made by the unorganised sector. So, in many ways,
bread and biscuits form the core of the bakery in-dustry in India (87.5%),
while cakes account for 12.5 % of volumes.
Biscuits
and breads are largely sold in grocery shops, general stores and retail
outlets. However, the relative share of “impulse purchase” in this category
is not very significant. In relative terms, penetration of biscuits
is higher in rural markets as compared to bread. The rural market, with
75% of the country’s population, accounts for 40% of bread consumption
and about 50% of biscuit consumption.
In 1977-78,
the government reserved bread and biscuit manufacturing for the small-scale
sector and restricted the entry of large producers. During the last
2 decades, small and unorganised players therefore shared the growth
in the industry. Currently, there are an estimated 2 million bakeries
across the country engaged in production of bread, biscuits and other
products in the unorganised sector.
The Abid
Hussain Committee had recommended the de-reservation of the industry
because the unorganised sector had not been able to maintain quality
and hygiene standards for want of capital and technology. The recommendation
was implemented in the 1996-97 Union Budget.
Technology
has also yet to make a big mark. Most bakeries still depend on human
labour to make products. As power supply is expensive and unreliable,
most bakeries also continue to use wood fire ovens for baking and human
hands and feet for kneading dough. And mixing machines have just started
making inroads into small bakeries.
Says Harish
Nagda of Mumbai-based Jain Bakeries: “Twenty-five years ago, the industry
depended only on basic raw materials – ghee, maida, sugar, wood –which
could be stocked in bulk and transportation by bicycle. No automation
was introduced in the industry as power supply was unreliable.”
