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From regional bites to a global shelf powerhouse
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Tuesday, 16 September, 2025, 16 : 00 PM [IST]
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Amit Dutta
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India’s snack and savouries market is on the cusp of a significant transformation. Currently valued at over Rs 797 billion (Western snacks: Rs 409 billion; Ethnic snacks: Rs 388 billion), the industry is witnessing an almost even split between westernised, modern formats and traditional Indian favourites. However, the market is evolving beyond the conventional chips-versus bhujia narrative. It is being shaped by changing consumer habits, rapid retail modernisation, and strong policy interventions designed to enhance scalability and export potential.
The analysis highlights that while India is one of the world’s largest food producers, its contribution to the global packaged food export market remains a modest ~1%, with just USD 572 million in exports in 2021. The true growth opportunity lies in translating domestic success into a formidable global footprint.
The Rs 95 trillion Indian retail market is undergoing a dynamic shift. Packaged foods are projected to expand from Rs 3,295 billion in FY 2023 to Rs 5,552 billion by FY 2027, reflecting a robust CAGR of 11%.
This transformation is powered by:
- E-commerce acceleration: Online grocery sales are growing at a projected CAGR of 16.8% by 2027, offering snack brands a high-velocity channel.
- Urban lifestyle shifts: Increased urbanisation, nuclear families, and the rise of working women are driving demand for convenient, hygienic, and ready-to-eat formats.
- Health-conscious consumption: Consumers are leaning toward baked, portion controlled, and clean-label snacks that align with wellness trends.
- Digital-first consumerism: Smartphone penetration and on-demand delivery platforms such as Blinkit, BigBasket, and Dunzo are reshaping how snacks are discovered and consumed.
Despite this rapid modernisation, organised retail penetration remains just 19%, leaving a vast untapped opportunity for brands to expand their footprint through modern trade, hypermarkets, and digital-first platforms.
Ethnic vs. Western: Who Will Win the Next Growth Wave?
Western snack formats currently have a slight market edge due to stronger scale, packaging innovation, and youth-focused positioning. However, ethnic snacks are catching up quickly, with a forecasted CAGR of 11% through 2027. This convergence is creating a unique battleground where both nostalgia and modernity coexist.
Key factors influencing this segment include:
- Modernising traditional favourites: Bhujia, sev, gathiya, and chakli are being repositioned for modern retail shelves and international markets.
- Premiumisation and healthification: Fusion formats combining traditional flavors with low-fat, high-protein, or gluten-free claims are emerging.
- Innovative packaging and compliance: Global-ready designs that meet stringent export standards are becoming essential.
Western snacks, with a CAGR of 12.1% (2023–2027), maintain an edge in scaling across India’s urban hubs, but the ethnic segment holds a strong emotional and cultural advantage that can be leveraged for premium positioning.
Policy-Led Acceleration: How Government Schemes Are Driving Scale
Government-backed initiatives are transforming the trajectory of India’s snack industry.
Schemes from Agricultural and Processed Food Products Export Development Authority (APEDA), Central Sector Scheme for Creation/Expansion of Food Processing and Preservation Capacities (CEFPPC), and the Production-Linked Incentive (PLI) program are enhancing infrastructure, ensuring compliance, and preparing brands for export readiness. This policy thrust aligns with India’s broader ambition to move packaged food exports beyond diaspora-centric markets such as the United States, United Arab Emirates, United Kingdom, Saudi Arabia, Nepal, and Bangladesh.
Turning Local Success into Global Shelf Presence
While India’s snack consumption is surging domestically, exports remain underleveraged at just USD 572 million in FY 2021 as mentioned above—about 1% of the USD 56 billion global packaged food market. Barriers include limited global brand recognition, non-standardised packaging, and fragmented supply networks. The path to unlocking this potential includes:
- Strategic co-manufacturing partnerships: Collaborating with global brands to set up export-focused production bases in India.
- Clean-label innovation: Offering vegan, gluten-free, and minimally processed snacks to meet evolving consumer demands abroad.
- Market entry strategy: Targeting mainstream retail channels in US, UK, and GCC while expanding beyond diaspora-focused ethnic aisles.
With the right strategy, Indian snacks could capture a larger share of global markets and unlock the next Rs 1,000 crore opportunity.
Who Will Lead India’s Snack Future?
India has the scale, diversity, and now the policy tailwinds to lead in global snacking. The next ?1,000-crore opportunity may not come from a bag of chips, but from a reimagined bowl of bhujia or a gluten-free chakli ready for US retail shelves.
For brands, the question is no longer whether the market will grow but who will act now to capture this convergence of organised retail, digital channels, and export momentum.
Blueprint for the Next Growth Wave To seize this momentum, Indian snack brands need to:
- Go organised, go digital, go pan-India: Leverage modern retail and e-commerce for national scale.
- Align with government incentives: Utilise PLI and export-focused schemes to optimise production and compliance.
- Reimagine traditional formats: Transform ethnic snacks into premium, healthier offerings that resonate with younger consumers.
- Plan for global entry early: Benchmark packaging, labelling, and co-manufacturing strategies for international markets.
India stands at the threshold of a new era in snacking - where modern retail, digital platforms, and policy incentives converge to create unprecedented opportunities. The market is not only about more snacks on more shelves; it’s about smarter strategies, premiumisation, and a global mindset.
(The author is director, Agri-Foods and
Nutrition Growth Advisory at Frost & Sullivan)
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