The Indian bakery market is on an upward trajectory, projected to grow from approximately US$ 12.6 billion in 2023 to US$ 29.4 billion by 2032, reflecting a CAGR of 9.8%. This growth is largely driven by consumer demand for diverse bakery items, with a significant push towards healthier and convenient options. Factors such as urbanization, rising disposable incomes, and a growing emphasis on health-oriented products like organic and gluten-free options are central to this growth.
With exports increasing from US$ 346.7 million in FY19 to US$ 557.6 million in FY24, showcasing a CAGR of 10%, India is also solidifying its role as a key player in the international bakery market.
The government’s supportive initiatives, including schemes to enhance food processing infrastructure, are further bolstering this growth. As the market adapts to evolving consumer preferences and embraces new technologies, both local and international players have a significant opportunity to tap into India’s expanding bakery landscape.
The bakery market includes a wide variety of items such as cakes, pastries, bread, biscuits, cookies, and other baked goods, available through supermarkets, specialty stores, convenience shops, and online marketplaces. The market can be divided into specialty items (like gluten-free and organic) and conventional products, with fresh goods making up a significant share.
Bakery products are favored for their nutritional value, taste, and texture. Research is increasingly focused on improving packaging and preservation technologies, as product quality and storage conditions significantly impact consumer acceptance.
Bread and rolls represent the largest segment of bakery products driven by the convenient nature of the product. According to Fortune Business Insights, the global bakery products market was valued at approximately US$ 480.23 billion in 2024 and is expected to grow to US$ 731.69 billion by 2032, with a CAGR of 5.4% during this period.
The bakery products market in India was valued at US$ 12.6 billion in 2023 and is projected to grow to US$ 29.4 billion by 2032, reflecting a CAGR of 9.8%, according to the IMARC Group. This shows that the Indian market is set to expand faster than the global average, highlighting the increasing demand for bakery products in the country.
The growing popularity of a wide range of baked goods—including pies, muffins, donuts, cakes, bread, cookies, bagels, biscuits, pastries, rolls, macarons, and brownies—is driving the expansion of the Indian bakery market.
The organic bakery sector is seeing significant growth, especially in urban areas, as consumers increasingly prefer healthier options like organic ingredients and sugar-free alternatives. This trend is driven by a growing awareness of health and wellness, with bakers offering nutritious options such as whole grains and gluten-free products.
Additionally, the rise of q-commerce in India is making online ordering of cakes and baked goods more popular, with bakeries using digital platforms to reach a broader audience, especially in cities. This shift is also helping smaller, unorganized players expand through food aggregators.
On the import front too, India is witnessing impressive growth. Imports have grown from US$ 42.9 million in FY19 to US$ 85.5 million in FY24, reflecting a strong CAGR of 14.8%. This trend could be attributed to changing consumer preferences, urbanization, and an expanding middle class seeking diverse food options. As the market evolves, there’s significant potential for both local and international players to tap into this burgeoning sector.
India is a key international player because of its large production capabilities. In the biscuit segment, India is the second-largest producer globally after the US. Bread production is also experiencing significant growth, particularly in rural areas where bread is becoming a staple in local diets. Both biscuits and bread are classified as fast-moving consumer goods (FMCG), leading to daily consumption that boosts their sales across the country.
According to the data from Ministry of Commerce & Industry, India’s bakery exports have increased from US$ 346.7 million in FY19 to US$ 557.6 million in FY24, at a CAGR of 9.9%. The primary export destinations include the USA, UAE, UK, Canada, and Yemen. Sweet biscuits account for about 60% of total exports, while other popular items include breads, wafers, and rusks. This growing export market reflects the global demand for Indian bakery products, further solidifying the country’s position in the international bakery landscape.
Population growth and demographics: As the world’s largest population, India sees rising demand for convenient baked goods. Companies are targeting rural and semi-urban areas with smaller, affordable packaging to reach a broader audience.
Changing lifestyles: Urbanization has led to a preference for ready-to-eat options. Bakery products fit well into this trend, offering convenience for busy consumers. In India, the net addition of population in urban areas over the last decade is 91 million, 31.6% of the total population.
E-commerce growth: The rise of online shopping and food delivery services is making bakery products more accessible, further fueling market expansion. The rise of e-commerce in India has been remarkable, particularly in tier-2 and tier-3 cities. With nearly 100% of pin codes experiencing e-commerce adoption, these smaller towns are becoming significant contributors to the market.
Rising disposable incomes: Higher disposable incomes allow consumers to spend more on premium and specialty bakery products, boosting overall market growth. India’s per capita disposable income reached ₹2.14 lakh (US$ 2557) in 2023-24. Per capita disposable income grew 8% in FY24 and 13.3% in the previous year.
The Indian bakery industry is set for continued growth, fueled by shifting consumer preferences for healthier and more convenient options. Bakeries that adapt by offering organic and sugar-free products are likely to succeed. Additionally, the expansion of online ordering and delivery services will enhance accessibility, attracting a wider audience.
Government initiatives, such as the Pradhan Mantri Kisan SAMPADA Yojana (PMKSY), are also supporting this growth. Implemented by the Ministry of Food Processing Industries (MoFPI), PMKSY aims to create modern infrastructure and improve supply chain management from farm gate to retail outlet. A key component of PMKSY is the Creation/Expansion of Food Processing and Preservation Capacities (CEFPPC), which has led to the establishment of 28 bakery processing projects as of 2023.
Additionally, the PM Formalization of Micro Food Processing Enterprises (PMFME)scheme is a centrally sponsored initiative with an outlay of ₹ 10,000 crore (US$ 1.2 billion), implemented over five years from 2020-21 to 2024-25. This scheme aims to provide financial, technical, and business support to existing micro food processing enterprises. As of 2023, a total of 2,017 bakery units have received assistance under the PMFME scheme, amounting to ₹ 186 crore (US$ 2.2 million) nationwide.
This support is crucial for enhancing the capabilities of small bakery operations, promoting growth and formalization within the sector. These initiatives are expected to further strengthen the bakery sector by enhancing processing capabilities and efficiency. As the market adapts to evolving consumer preferences and embraces new technologies, both local and international players have a significant opportunity to tap into India’s expanding bakery landscape.
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