Download the PDF version here - Indo-American Chamber Of ...

in other parts of the world, and it will happen in India over the next few years. I have the broader plan in
place.
What are the challenges you might face?
The challenge in India is not that we will not have demand for these products. It is just that the timing
and the pace of change needs to be understood and business evolution needs to be brought in sync with
it. Because it can be painful if you invest ahead of the curve, just as it can be if you are left behind of the
curve.
It is not easy building food brands in India for the simple reason that we are a very fragmented market.
There are tastes and preferences which vary across geographies. The retail networks are so fragmented
that accessing it and creating the supply chain for it is extremely expensive and complex. And, obviously,
these are businesses that have a very low margin; so the cost of building a brand can be phenomenal for
a category like flour. The food sector typically takes about 8-10 years of work in the market to get
established. We have already gone through that phase. Going forward, a lot of it would be leveraging on
what we have already created.
What will be the mode of your expansion?
It will be a combination of various strategies. Looking at the past, it has been a combination of investing
in assets; it’s been about acquisitions and also acquiring brands. Our experience so far tells us that it has
to be a mix of these various things.
What kind of reforms would you like to see in the commodities markets?
Regulation is linked to maturity of the markets. These regulations are about protecting the farmer or
consumer. To unshackle this, there has to be a lot of trust-building. This is something that needs to
come into the regulatory system but I think the trade also has responsibilities that of building trust with
the government and with the consumer.
We have APMC Act (Agricultural Produce Marketing (Regulation) Act), which restricts access to farmers.
We have stock limits which restrict movement of goods. GST (goods and services tax) is something very
important to reduce the cost of doing business. The correct implementation of the new national food
safety Bill is also very important. We have less disagreement with what the government wants to do. I
think where we struggle is how the government is doing it. The concern I have for the food Bill is it could
fail for poor execution.
Agencies have forecast a poor outlook for food in terms of supply and prices in the world. Fears are
that there might not be enough food for everyone.
As a company, we don’t subscribe to that view. The world has enough food and enough calories to feed
itself today and in the future. It is the distribution of those calories that is important and that’s where
the government and society has a huge role to play.
It’s the supply, distribution, free trade, trust between countries and organizations that is important. The
reality is only 15% of the world’s calories cross borders. So 85% of the food gets consumed where it gets
produced. So it is about managing our resources better.