Sunday, January 16, 2011


Food processing sector in India is more or less monopolized by many multinational companies (MNCs) either directly or through their local subsidiaries. There has always been a big question mark regarding the "sun rise" tag attributed to Indian food industry because of relatively low proportion of processing the raw food materials undergo. With a very low value addition achieved by most of the native industrial units, it is but natural that MNCs found it a fertile situation to invest money and modern technology to reap rich benefits. With highly effective marketing strategy there has never been a challenge to the dominance of MNCs in the food sector. Many observers often wondered in the past as to why the Tatas or Ambani's or Birlas or any highly successful entrepreneurial giants of Indian origin were not interested in investment in the food sector. Exceptions are there like the alcoholic beverage industry (Mallya group) and Tea industry (Tatas) which dominate the world landscape in their respective areas. The recent take over of a UK food processing firm by a dynamic Indian group must warm the hearts of every Indian with pride.

"Maharashtra-based Jain Irrigation Systemstoday said it has entered into an agreement to acquire an 80 per cent stake in UK-based Sleaford Quality Foods Ltd (SQFL), an industrial food ingredients supplier. It, however, did not mention the price of the acquisition. The acquisition will help Jain Irrigation's food division to have a direct access to a large market with value-added products, a press release issued here stated. Sleaford Quality Foods, a supplier of food ingredients to the food industry, has been in the business for more than 40 years and its product range covers a large spectrum of food ingredients including dehydrated vegetables, spices, herbs, dehydrated fruits, soup mixes, pulses and canned vegetables, among others. Sleaford Quality Foods has a nation-wide distribution and strong sales force and sells its products to multinationals and other food companies under its own brand name or private labels. The acquisition brings the domestic major one step closer to market, with an opportunity to enter into the large ethnic food market in the UK and possibility of addition of new products in Jain's food division product range, the release said".

Though the horticulture products processing is relatively a small segment of the Indian food industry, it earns valuable foreign exchange through exports to many countries. It is a different matter, however, that the country's foreign trade in processed foods is still a minuscule part of the global food food business but there is hope that with new acquisitions like the one reported above, it is a question of time before India becomes a significant global player in this area. The spices oleoresin industry in India, which has cornered a major portion of global market in a relatively short time of two decades, starting almost from the scratch. is a role model for the fruit and vegetable industry to emulate.

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