With explosive growth and an emerging middle-class society seeking new experiences and high value-added products, India has sparked the interest of Chile as a strategic ally to penetrate the South Asian market.
The world of opportunities that India presents for Chile set the tone for the inauguration of Enexpro Alimentos ProChile 2023, the first in-person edition since 2019. More than 20 importers from various destinations, including South Korea, the United States, Brazil and, of course, India, traveled to Chile to meet with more than 200 exporters participating in the trade meetings on June 6 and 7.
According to data from ProChile, Chile's agri-food exports to India totaled US$133 million in 2022, a figure that already reached US$21 million in the period from January to April 2023. Fresh apples, fresh kiwis and dried fruits stand out as products, while others such as plums and raisins are beginning to gain ground, paving the way for the entry of other products, such as cherries.
During her presentation, Marcela Zúñiga, Commercial Director of ProChile in New Delhi, emphasized the importance of investing in India and investing in the market to build loyalty among the local population. She said: “India is a challenge. It requires study, exploration and for our exporters to build relationships with their importers to grow and consolidate in the market. Today, local consumers are demanding high value-added products that are healthy, considering the aftermath of the COVID-19 pandemic and the high rate of diabetes affecting the population.” He added: “The invitation is to explore the market, get to know it and rely on the two commercial offices that ProChile has in New Delhi and Mumbai.”
India is a huge market, but it should be clear that imported products do not reach all of the 1.4 billion people; they are aimed at a niche market. Consumers who buy imported products belong to the middle and upper-middle class, those who can afford to pay the taxes levied on imported goods.
India is a market that requires building trust and establishing long-term commitments. Zuñiga points out, “With India, you don’t develop commercial relations; you develop a marriage. It’s not just about agreeing on a price, but mainly about the next step, how to expand to another region. The Indian market is waiting for us; it is a very attractive and important market that needs Chilean products,” emphasizes the commercial director of ProChile.
The fundamental role of marketing
Regarding the demand for cherries from India, Marcela Zúñiga highlights the need for marketing efforts. “It is important to understand that although cherry imports are growing in India, it is not China. Cherries are still a niche product in India and are in the process of growth and development. If campaigns are carried out to promote their consumption, we must show Indian consumers how to incorporate cherries into their diet, in sweet preparations or meals. We can stimulate this consumption and make it grow.”
Kanish Gupta, owner of Supreme Enterprises, with a distribution chain in strategic markets such as Mumbai, Delhi and Bangalore, has been importing fresh Chilean fruit for a year, responding to a strong demand for good and healthy products. “We are currently importing Chilean blueberries, raspberries and blackberries. Once in India, we distribute them across the country. I think there is a lot of potential. Educating Indian customers on how to use these fruits will help us. The current price is very attractive for the Indian market. There is a lot of potential to move forward,” Gupta said.
“The challenge we see is logistics; it takes 75 days to reach India. Secondly, we see in Chile or in the United States different applications for these fruits, such as smoothies or juices, but Indian manufacturers do not know how to make these products, so perhaps someone can help us with that, and it would increase Chile’s demand for market share in India,” Gupta explained.
Prospecting trip to India
India will be the focus of the next public-private trip organized by SOFOFA and ProChile, with the participation of industry associations.
Iván Marambio, President of the Association of Exporters of Chile (Asoex) provided details: “During the week of June 19th we have a prospecting trip to India with a busy agenda, which includes visits to wholesalers, retailers, promoters, logistics, ports and more. Everything is focused on supporting the import of our fruit.”
It is important to note that India has emerged as the world's fastest growing major economy. It is expected to be one of the top three economic powers in the next 10 to 15 years.
Claudia Soler, Manager of the Asoex Cherry Committee, stated: “Chile and India share a special trade relationship, and many Chilean products can be imported into India with preferential customs duties. Chilean cherries in particular have great potential as the import duty in India is 0%. In comparison, the import duty on cherries from other origins is 30 %.”
“India is a growing market for imported cherries. Cherry imports are increasing year on year. Although the current volume is limited, there are huge opportunities. India produces a small quantity of cherries that are consumed in August and September, so it does not compete with the Chilean supply.”, Soler added.
Evolution of Chilean cherry exports to India in tons, by season:
2019/20: 126 tons
2020/21: 255 tons
2021/22: 393 tons
2022/23: 460 tons
Growth in the last year: 16,95%
The main challenges posed by Asoex are:
- There is a significant logistical challenge. There is no optimized sea route, so air routes involve high freight costs and a high price for consumers.
- The lack of an integrated cold chain, especially at the retail level and for secondary distribution of products, hinders the quality and reach of products.
“India can become the new China as long as market challenges are overcome,” Soler concluded.
