Chennai: If the response gathered at the Foodpro 2001 exhibition, organised by the Confederation of Indian Industry in Chennai recently, is any indication, many Australian food product companies are showing a keen interest to foray into the lucrative Indian market.
The fair attracted a large contingent of food companies from Down Under, displaying products ranging from red meat, processed ginger, fruits, soya milk, chocolates, cookies, biscuits and food processing equipment like biscuit and bread moulds, bakery equipment and mixers. The common factor was that all were in search of an Indian representative.
Says Majella Fernando, marketing coordinator (Indian subcontinent) Meat and Livestock Australia, a marketing and research organisation: We are here to explore the Indian market for our red meat.
Peter Gardiner, MD, Pacific Ocean Enterprises, Australia, says: With the lifting of import restrictions it is natural for us to look at India. The US $3-million-turnover company has just shipped four containers of mutton to Nepal. We will appoint our Indian distributor shortly.
Henderson Mallick, Australia, is already selling meat in India. We have shipped our first consignment of lamb, pork and small goods like hams and sausages, says Dominic Spurrett, the company export sales manager.
What is appealing about the Australian meat companies is their pricing methodology. Unlike the domestic market, where the meat is priced uniformly and sold in kilogram, the Australian companies price each part of an animal carcass differently. In India we believe the market exists for leg, shoulder and neck-cuts, Fernando says. The advantage that Australian companies enjoy is the higher meat content in an Australian lamb, as compared to its Indian counterpart.
After adding import duties, our prices will be competitive to that of the local market. We are not going to compete directly with the Indian market - ours is a niche product and will be targeted at star hotels and major retail chains, says Gardiner.
M Ramona of the New Delhi-based Resource International says: Given the choice, expatriates prefer Australian meat because it is tenderness. Resource International imports cater to the imported meat demand of many star hotels in Delhi.
Sanitarium Health Food Company, Southern Crown Products, Weston Food Ingredients, Ardmona Foods, Arnotts Biscuits, Brian Mcguigans Wines, Eastern Pacific Foods, Greens General Foods, Grans Fudge and Buderim Ginger are the other Australian companies wanting to appoint Indian agents.
A high import duty - 67 per cent for most food products - is an issue to be tackled. If one adds the local taxes to the import duty, the cost goes up by 130 per cent in certain cases, says Vasant Manoharan, a trade consultant with Vasantham Consultants, Australia.
With several Australian food companies expressing its desire to enter India, the trade-mix between India and Australia has to change. Currently India imports coal, cotton, wool and pulses from Australia and exports gems, garments and jewellery to that country. The total trade between the two countries is in the region of Aus $2.7 billion, says an Austrade official.
In the meantime, bitten by the bad experience of importing substandard Australian apples, Indian importers are now looking at apples from other countries. According to an industry official, the idea now is to import apples from France.