Domestic fresh meat sales, however, are currently doing exceedingly well, and it is questionable whether the government of an emerging economy with a poverty-stricken population can afford to clamp down on an important source of national prosperity.
BJP does not condone ‘pink revolution’
India’s meat industry is booming. Euromonitor’s data show that it sports the world’s largest herd of cattle, with 221 million animals in 2013, and that it also ranks as the fourth-largest beef producer behind the US, Brazil and China. India is also the world’s 15th-biggest exporter of meat and meat products, generating revenues of almost US$3.5 billion in 2013.
The Indian National Congress party (INC), which governed the country for 53 of the 66 years since India declared independence in 1947, was, on the whole, positively predisposed towards helping India’s meat industry grow.
But, as of May 2014, after a spectacular loss for the INC, India has a new government – the BJP – and this is making the country’s meat industry, which is dominated by Muslim-owned businesses, quake in its boots.
The BJP declared during its campaign that, once in power, one of its objectives would be to curtail India’s ‘pink revolution’. This is a reference to the ‘green revolution’ that took place during the 1950s and 1960s, brought about by modern agricultural inputs, which boosted crop yields significantly.
India’s new Prime Minister Narendra Modi, an observant Hindu and a committed vegetarian, seems to be taking particular umbrage at India’s rapidly growing beef exports. "What is the crime of my mother cow… that you are slaughtering her and selling in the international markets just to earn money," was one of Modi’s emotive statements on this matter, voiced during the election campaign.
It must be pointed out, however, that the slaughter and export of cows, which are sacred animals in Hinduism, is already prohibited in India. The country’s beef industry focuses instead on water buffalo meat, both for domestic consumption and export.
On the domestic consumption front, propelled by India’s growing middle-class consumer base, an expanding network of modern grocery retailers and a rampantly dynamic consumer foodservice channel, India’s internal fresh meat market has also been buoyant. Euromonitor International’s data show that beef and veal (water buffalo in this case) drove Indian fresh meat sales in 2013, outperforming poultry, lamb, mutton and goat, as well as pork. Beef and veal achieved volume growth of 9% that year, one percentage point ahead of fresh meat overall.
This dynamism held true throughout the 2008-2013 review period, with beef and veal delivering 47% volume growth, while pork achieved less than 10% and even poultry, which is still the most popular type of meat in India, only managed a 37% gain. Another factor bolstering the country’s domestic meat sales is India’s high inflation rate, which has served to diminish the gap between vegetable and meat prices. The prices of some types of pulses now exceed those of buffalo meat.
Will India really cut off its nose to spite its face?
It is not yet clear how and whether the BJP’s election promises will translate into concrete trade, agricultural and livestock production policies for India, but it is questionable whether, in reality, the party would be prepared to sacrifice the country’s economic growth and prosperity on account of religious sensibilities. India, after all, has far greater economic and social problems than the evils of meat consumption.
If the BJP is set to limit the amount of meat consumed, particularly within its borders, rather than implement obstructive policies that will only create anger and discontent, it would be far more advisable to employ indirect measures that would actually benefit its population on the whole. For example, by taking measures to ensure that protein-rich vegetarian foods, such as pulses and dairy products, are kept affordable, low-income consumers would not be pushed by purely economic needs to resort to meat in order to feed their families, potentially violating their religious principles.
We predict that over 2013-2018, unlike during the review period, fresh poultry in India will outperform beef and veal in terms of growth performance. We expect poultry volumes to increase by 31%, with beef delivering a slightly weaker 26% gain. On the whole, however, the dynamism of India’s meat market is unlikely to collapse.
India remains one of the countries with the lowest per capita meat consumption in the world, standing at just 5.6kg in 2013 – way behind the global average of 33.2kg. With a population of nearly 1.3 billion, even a tiny per capita consumption increase has the potential to translate into a significant rise in fresh meat volumes, not to mention the enormous potential for growth harboured by this latent market as it gradually creeps towards global average consumption levels.