CCP:BA/TF 05/9
July 2005
E
COMMITTEE ON COMMODITY PROBLEMS
INTERGOVERNMENTAL GROUP ON BANANAS AND
TROPICAL FRUITS
Fourth Session
Guayaquil, Ecuador, 19 – 23 September 2005
MARKET PROFILE ON TROPICAL FRUITS IN INDIA
Table of Contents
Paragraphs
I. INTRODUCTION 1
II. PRODUCTION 2-4
III. TRADE 5-7
IV. APPARENT CONSUMPTION 8 - 10
V. FACTORS AFFECTING DEMAND IN INDIA 11 - 16
A. POPULATION 11
B. INCOME AND PRICES 12 - 14
C. CONSUMPTION HABITS AND PREFERENCES 15 - 16
VI. CONCLUDING REMARKS 17 - 18
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CCP:BA/TF 05/9 1
I. INTRODUCTION
1. At its Fourth Session, the Sub-Group on Tropical Fruits recommended that the Secretariat
carry out a market update on India, and a market overview of the Near East. The Secretariat was
not able to carry out a market overview of the Near East due to resource constraints. An attempt at
a desk research also proved futile due to a paucity of information on the markets for tropical fruits
in the region. Therefore, this document is devoted entirely to the major developments in supply,
demand and trade of tropical fruits in India and the likely future prospects.
II. PRODUCTION
2. India is one of the most important fruit producing nations in the world, accounting for
about 10.4 percent of all fruits and nearly 40 percent of tropical fruits produced globally. Fruit
production in India increased at an average annual growth rate of 3 percent between 1995 and
2004, while harvested area and yields increased by 2.4 and 1.5 percent, respectively. Fruit
production increased steadily from 36 to 47 million tonnes, between 1995 and 2004, largely as a
result of supply side policy incentives. It contributes 10 percent on average to the gross value of
total agricultural output in India, and about 13 percent of the total export earnings from major
agricultural products. The major fruit growing states include, Uttar Pradesh, Karnataka, Tamil
Nadu, Maharashtra, and Gujarat.
3. The main tropical fruits produced in India include banana, mango, guava, pineapple,
papaya, lychee (or litchi), and to a lesser extent sapota, jackfruit, phalsa, annona and ber. The 3
major tropical fruits (mango, pineapple, and guava) accounted for 33 percent of total fruit
production in 2004. Mango output was 10.8 million tonnes in 2004, a 6.2 percent increase over
1998/2000, while production of papaya and pineapple was 700 000 and 1.3 million tonnes,
respectively, in 2004. Papaya grew by 4.3 percent over the 1995/2004 period, while pineapple
production increased by 2.3 percent over the same period. India is the largest producer of mango
in the world, accounting for about 41 percent of world output in 2004, and the second amongst
papaya producing countries.
4. Tropical fruit production could be further developed by inter alia:
• improving productivity and quality from the existing crop areas,
• developing infrastructure for post-harvest marketing,
• increasing the availability of quality seed/planting material,
• stimulating transfer of technology,
• improving product harvesting and handling, and
• promoting export into existing and new markets.
Table 1: Production of selected Fruits in India
Average (1992/1994) 2002 2003 2004
('000 tonnes)
Bananas 9718 16820 16820 16820
Mangoes 10108 10640 10780 10800
Oranges 1743 3120 3070 3070
Apples 1205 1160 1470 1470
Lemons and Limes 863 1440 1420 1420
Pineapples 956 1180 1310 1300
Grapes 684 1210 1150 1200
2 CCP:BA/TF 05/9
Papayas 470 700 700 700
Pears 127 200 200 200
Peaches and Nectarines 83 150 150 150
Grapefruit and Pomelos 83 140 142 142
Plums 55 80 80 80
Figs 6 11 11 11
Apricots 7 10 10 10
Cherries 4 8 8 8
Source: FAOSTAT
III. TRADE
5. Although India is one of the worlds’s largest fruit producers, current export volumes
remain small. Most of the fruit produced in India is consumed domestically. Export volumes
represent less that 1 percent of total domestic output, as well as less than 1 percent of world
exports. More than 80 percent of fruit exports from India are tropical fruits, including mangoes,
guava, pineapples, and papayas. India was the second largest exporter of mangoes in the world in
2004, after Mexico, shipping 180 000 tonnes or 21 percent of the world total. Exports of papaya
and pineapple amounted to 3 550 tonnes and 1 624 tonnes, respectively. India also imports a
sizable quantity of fresh fruits, but these are mainly temperate fruits such as apples and pears, and
a large volume of dried fruits such as dates and raisin. Total imports of both fresh and dried fruits
reached 216 400 tonnes in 2003 (the latest year for which a complete set of data on the value of
trade exists), and were valued at US$ 47.1 million.
6. Foreign exchange earnings from fresh and processed fruits (including dried and canned
fruit as well as pulps and juices) amounted to US$ 140 million in 2003, an almost twofold
increase (185 percent) over the 1996 - 1998 average. Mango is the main fruit exported from India.
Export earnings from fresh mangoes totalled US$ 80 million in 2003, which was 61 percent of
India’s total fruit exports. About 50 percent of processed fruit exports were mango-based
products, such as mango pulp for juice mixes, and condiments including pickles and chutneys.
However, on a comparative basis globally, only 2 percent of the fruit production in India is
processed compared to 70 percent in Brazil, and 83 percent in Malaysia. It is estimated that about
25 to 30 percent of fruit production is wasted due to a lack of post-harvest infrastructure.
7. The Near East, the Far East and Europe are the main export destinations for fresh tropical
fruits and processed products from India. Processed products such as fruit juice, fruit pulp and
pickles are mostly exported to the Russian Federation and the Near East. Other markets for
processed fruit are the United Kingdom, United Arab Emirates, Saudi Arabia, Kuwait, Germany,
United States, the Netherlands and Switzerland. India also exports dried mango slices, puree,
paste and juice to many of the same markets. In 2003, the major destinations for fresh mangos
from India were Bangladesh (42 700 tonnes), Saudi Arabia (38 382 tonnes), the United Arab
Emirates (28 621 tonnes), Yemen (11 189 tonnes), Netherlands (9 106 tonnes), Kuwait (7 150
tonnes), Nepal (5 405 tonnes), and the United Kingdom (4 890 tonnes).
IV. APPARENT CONSUMPTION
8. Favourable growing conditions permit the production and supply of a large variety of
tropical fruits throughout the year. These are consumed not only in the regions where they are
grown but throughout India. Terminal markets in major Indian cities receive large quantities of
tropical fruits, which are then sold through retail dealers in the other cities and towns. Statistics on
CCP:BA/TF 05/9 3
consumption of tropical fruits are not available, so estimates need to be derived based on other
information available on production and trade.
9. Total apparent consumption of fruits in India was estimated at 39 million tonnes in 2002
(the latest year for which consumption data is available), about 8 million tonnes larger than in
1995, with consumption of fresh tropical fruits estimated at 16.3 million tonnes. Annual per capita
consumption of fruit was evaluated at 37 kilograms (kg) in 2002, a 12 percent increase over 1995,
with major tropical fruits at 13.3 kg (bananas at 7.7 kg), temperate fruits at 4.2 kg and other fruits
at 5.9 kg. According to the National Sample Survey Organization, 64 percent of rural households
reported fresh fruit consumption in 1999 compared to 84 percent of households in urban areas.
10. Research studies into the consumption of tropical fruits in India showed that among major
states, Kerala, Tamil Nadu in the South and Goa in the West have the highest level of
consumption of fruits both for rural and urban areas. These states are followed by Punjab,
Haryana, Delhi, and Union Territories of Chandigarh in the North. Bihar and Orissa in the east
and Rajasthan and Madhya Pradesh in central India have much lower levels of consumption.
V. FACTORS AFFECTING DEMAND IN INDIA
A. POPULATION
11. Population growth in India was estimated at 1.67 percent per year between 1995 and
2004. According to official statistics, population growth is expected to decline to 1.3 percent per
year by 2015 when the total population of India is expected to reach 1.2 billion. Research studies
revealed a sizable potential to expand fruit consumption in rural areas, states with currently low
per capita consumption rates and growing urban areas.
B. INCOME AND PRICES
12. Indian economic development has been strong recently with GDP growth averaging 5.6
percent between 1990 and 2003, largely as a result of robust domestic demand. Inflation has been
contained and exports have been strong. These facts contributed to a 3.75 percent rise in per
capita income between 1990 and 2003, with household expenditure for fruits and vegetables
estimated to have increased about 5 percent per year over the same period. Annual per caput fruit
consumption also increased, from 30 kg in 1992 to 37.7 kg in 2002.
13. The consumption of tropical and other fruits is largely correlated with per capita income.
Research conducted by the Indian Agriculture Research Institute indicated that the proportion of
the population that make up the highest income group consumes about six times more fruits than
the lowest income group, in both rural and urban areas. Urban households spend 2.25 percent of
their income on fresh and dried fruits, while rural households spend 1.8 percent of their income on
the same items. For rural areas, income elasticity of fruit demand for the highest income group
was evaluated at 0.283, while that of the lowest income bracket was 0.826. Similarly for urban
areas, the income elasticities were 0.293 for the highest bracket, and 0.782 for the lowest. Lower
income groups are, therefore, more likely to account for most of the future growth of the market
in India.
14. Prices of fruit have increased more than the General Price Index between 1999/2000 and
2003/2004: the All Commodities Wholesale Price rose by 21 percent, while the Fruits wholesale
price increased by 39 percent. A substantial price differential exits between wholesale and retail
prices. This might be due to rising costs in processing, distribution, and marketing, or due to a
non-competitive market structure. High retail prices constitute a major constraint for increasing
consumption, particularly among the middle to low income household groups.
4 CCP:BA/TF 05/9
C. CONSUMPTION HABITS AND PREFERENCES
15. Upon further analysis it became apparent that the trend toward healthier food
consumption in India reflected in growing interest in the nutritive attributes of tropical fruits,
particularly as household incomes grow. The interest in healthier diets has led to an expansion in
the consumption of all fruits, of which a large share has been that of tropical fruits. Temperate
fruits are found to be consumed mostly by the high income group, while tropical fruits
consumption is more wide-spread among all income groups. Large quantities of fresh unripe
mangoes are used in household preparation of pickles and chutneys. Consumption of lychee and
sapota is mainly concentrated among the middle and high income group. The tourism industry is
also contributing significantly to the rise in tropical fruit consumption. The growth in air travel
and tourism in India has enabled foreigners to experience the taste of a large variety of tropical
fruits. This contributes positively to a rising market demand for tropical fruits in Asia, Europe,
and North America. Another factor contributing to rising consumption is domestic promotional
activities. The Government of India has recently carried out various nutritional education
programmes to raise awareness on the importance of a varied diet, and the benefit of fruit
consumption. In addition, promotional programmes carried out by the fruit juice processing
industry through television, newspapers and in-store promotional activities encouraged overall
demand for fruits.
16. Prior to 1997, imports of fresh and dried fruits, with the exception of dates and figs, were
prohibited. Following the liberalisation of trade in agricultural commodities, imports of all fresh
fruit (except citrus, grapes and lychees) have been permitted generally on Open General License
(OGL) bases. In the case of South Asian Association for Regional Cooperation (SAARC)
countries1, an import tax of 44 percent ad valorem is levied, while for other countries it is set at
45.6 percent. There are no reported export duties on fruits from India.
VI. CONCLUDING REMARKS
17. Domestic demand for fresh fruits in India has been on the increase in line with rising
incomes, population growth, and increased health consciousness among consumers. Fruit
consumption in India is anticipated to increase by about 4 percent per year according to projected
growth rates for income, population, and trends in food preferences. In addition, growth in
demand for Indian fresh and processed tropical fruits has been strong in recent years and this
trend is likely to continue in the medium term.
18. This holds considerable potential for domestic producers and suppliers of tropical fruits in
India, and in the case of the Indian market, for the overseas suppliers that are able to compete
effectively with domestic supplies. Growth in the fruit production and processing sub-sectors
provides employment opportunities and income generation, and contributes positively to food
security. Furthermore, tropical fruit production provides an alternative option for crop
diversification, as well as support to rural entrepreneurs engaged in the supply of inputs for
production and purchasing of fruit for marketing. However, to fully realise this potential requires
changes in the value chain, particularly to compete in the quality sensitive international markets.
Development of efficient post-harvest handling infrastructure, transportation facilities and the
quality of the produce must be priorities, especially for fruits that are grown for the lucrative
export market. Improvement to the existing system is challenging and requires considerable
support from Government, research institutions, and technology suppliers to develop appropriate
facilities and practices at all stages of the value chain.
1
Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.
