IHM-AURANGABAD

Chapter-1: Introduction
Introduction:
The Indian financial system, till the early 90`s, was a closed system with its main
characteristics - an administered structure of restrictive acts, interest rates, restrictions
on all market participants--including banks, FI (Financial Institutions) & corporate –
by the way of limits on the amount / volume and nature of the transactions they can
undertake. Also they had to get prior approval before taking any actions. Some
industries were limited to the control of public sector only.

(http://www.article-diary.com/articles/2322/1/Pre-Liberalization-Indian-
Economy/Page1.html) Accessed on 14/12/2010 Time: 14:00pm

In 1991, after India sold 67 tons of gold to the International Monetary Fund (IMF), the
government of P. V. Narasimha Rao and his finance minister Manmohan Singh started
breakthrough reforms. The new neo-liberal policies included opening for international
trade and investment, deregulation, initiation of privatization, tax reforms, and
inflation-controlling measures. The overall direction of liberalisation has since
remained the same, irrespective of the ruling party, although no party has yet tried to
take on powerful lobbies such as the trade unions and farmers, or contentious issues
such as reforming labour laws and reducing agricultural subsidies. The main objective
of the government was to transform the economic system from socialism to capitalism
so as to achieve high economic growth and industrialize the nation for the well-being
of Indian citizens. Today India is mainly characterized as a market economy.

(scale.http://en.wikipedia.org/wiki/Economic_liberalisation_in_India)

Accessed on 15/12/2010 Time: 12:23 pm

1.2 Globalization and Liberalization of the Indian Economy:

Globalization and liberation are directly linked with each other. The first wake of
globalization started in India when the economic liberalization policies were
undertaken in the 1990s by Dr Manmohan Singh, the then Finance Minister of the
country. Since then, the economy of India has improved to a great extent and has
significantly led to the rise in the standard of living of the citizens.

1.2.1 Pre liberalization period and globalization

From independence till the later part of the 1980s, India economic approach was
mainly based on government control and a centrally operated market. The country
did not have a proper consumer oriented market and foreign investments were also
not coming in. This didn‟t do good to the economic condition of the country and as

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such the standard of living didn‟t go up.

In the 1980s, stress has given on globalization and liberalization of the market by the
Congress government under Rajiv Gandhi. In his government tenure, plenty of
restrictions were abolished on a number of sectors and the regulations on pricing
were also put off. Effort was also put to increase the condition of the GDP of the
country and to increase exports.

Even if the economic liberalization policies were undertaken, it did not find much
support and the country remained in its backward economic state. The imports
started exceeding the exports and the India suffered huge balance of payment
problems. The IMF asked the country for the bailout loan. The fall of the Soviet
Union, a main overseas business market of India, also aggravated the problem. The
country at this stage was in need of an immediate economic reform.

1.2.2 Liberalization in the 1990s

It was in the 1990s that the first initiation towards globalization and economic
liberalization was undertaken by Dr Manmohan Singh, who was the Finance
Minister of India under the Congress government headed by P.V. Narasimha Rao.
This is perhaps the milestone in the economic growth if India and it aimed towards
welcoming globalization. Since, the liberalization plan, the economic condition
gradually started improving and today India is one of the fastest growing economies
in the world with an average yearly growth rate of around 6-7%.

1.2.3 Impact of globalization and liberalization

Globalization and liberalization has greatly influenced the Indian economy and made
it a huge consumer market. Today, most of the economic changes in the country are
based on the demand supply cycle and other economic factors. Today, India is the
world‟s 12th largest economy in terms of market exchange rate and 4th largest in
terms of the Purchasing Power Parity. Globalization and liberalization has also made
a positive impact on various important economic segments. Today, the service
sectors, industrial sectors and the agriculture sector have really grown to a great
extent. Around 54% of the annual Gross Domestic Product (GDP) of India comes
from the service industry while the industrial and agriculture sector contributes
around 29% and 17% respectively. With the improvement of the market, more and
more new sectors are coming up and reaping profits such as IT services, chemical,
textiles, cement industry and so on. There has been an improvement in the
manufacturing sector as well which grew from 8.98% in 2005 to around 12%. The
communication segment has grown up to around 16.64%. The condition is expected
to improve further with more demand and increase in customer base. The yearly
growth of the industrial sector has been around 6.8 % which will rise more in the
future. India is one of the well known industrial markets in the Asia-Pacific region.

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Source: (http://business.mapsofindia.com/globalization/liberalization.html)

Accessed on 20/1/2011 Time 17:00pm

1.3 Indian Cheese Industry:

India is one of the fastest growing markets for cheese with annual growth pegged at
20% with a total consumption of about 7,000 tons a year according to an official of
the Indian Agri-Commodity Federation. With one of the largest consumer bases in
the world, cheese could be a multi-million dollar industry in India. Nowhere else do
people consume cheese in so many different forms and use cheese in so many
varieties of food preparation as in India.

In mom and pop stores as well as supermarkets we find tinned cheese and cheese
cubes which are salted and ready-to-eat; cheese spread which was introduced as a
substitute for butter; cheese singles (slice) which are used as stuffing for sandwiches;
pizza cheese used as topping on pizzas which are fast becoming the preferred fast
food in Indian metros. Amul has even introduced a low calorie version of cheese
called “slim cheese.” Weight conscious people are slowly taking to this new
product,” says Sandeep, a salesman at a retail outlet in central Delhi.

Source:(http://www.foodindustryindia.com/newfood/detailnews.=Cheese
consumption) Accessed on 13/1/2011 Time: 13:42pm

Top players of branded cheese manufacturing in India include Amul, Britannia, Le

Bon, Mother Dairy and others. Out of these, Amul has a market share of 65%
according to Agri-Commodity Federation. There are others such as Vita and Vijaya
who have a market share in the cheese market but their share is insignificant.

During the last few years, the Indian cheese market has grown steadily at 15 to 20
per cent per annum according to a market survey of dairy products in India. The
Australian cheese processor, Kraft, has made an inroad into the Indian market
followed by Remia of Holland. Initially, the imported brands of cheese were
introduced into Delhi, Mumbai, Kolkata and Chennai and were patronized by
expatriates. But, now some Indians too have started taking a fancy for these brands.

Source: CHEESE CONSUMPTION GOING UP IN INDIA,

Author: Vincent Van Ross, New Delhi: Aug 7 2008

(http://topangle.instablogs.com/entry/cheese-consumption-going-up-in-india/)
Accessed on: 17/1/2011 Time: 12:15pm

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1.3.1 Consumption patterns:

There have been two significant changes in consumption patterns, affecting each end
of the spectrum. In the mass consumption category, Indian consumers are more ready
to buy off the shelf. Paneer, which all the major cheese producers are marketing as a
branded product, was traditionally home made. Secondly, with greater international
exposure, rising incomes and brand affiliation; the demand for niche cheese products
has increased. Amul was an early mover in capitalizing on the demand for
specialized cheeses like Gouda and Emmental. However, cheese consumption
continues to be an urban phenomenon, with processed cheese and cheese spreads
accounting for about 80% of the total cheese consumption. Also, cheese is mostly
consumed by children and is yet to be part of the mainstream adult diet on a mass

It is true that India is not a traditionally structured 'cheese nation'. It is rather a land
of „Paneer‟ the „very young Cheese‟. Paneer is used in every household, in India. On
the contrary, Cheese is very recently making its mark in the industrial sector and the
market. The popularity and use of cheese though is less, yet it is remarkable as it is
still making lots of profits.

The organised cheese industry in India is at best in its nascent stage, accounting for
under 1% of total dairy production and largely limited to urban consumption. The
organized cheese industry in India as of 2006, is valued at Rs 250 crore ( US$ 50
million), with a volume in excess of 8000 tonnes. The industry growth rate is
estimated at about 10%-12% per year in terms of volume and 16%-17% per year in
value terms. Current household cheese penetration is 5%, with about 50% of
consumption being limited to cities. Mumbai and Delhi together capture half of the
cheese market. Within cheese products, around 60% of the market is dominated by
processed cheese, 30% by cheese spreads and the remaining 10% by flavoured and
specialty cheese. Amul and Britannia Milk Man are the lead brands.

India exported Cheese in a volume of 8000 tonnes; a value of Rs 250 crore. The
cheese industry‟s growth rate has been estimated to be of 10%-12% approx. per year.
As for the quantity, the estimated volume is increasing at the rate of 16%-17% per
year. It can be well assessed that the Cheese industry in India is growing at a regular
speed and will surely have a hold over the International market of Cheese business.

Source:(http://www.indianexpress.com/news/Italian-cheese,-sold-in-the-US,-made-in-
India/260933/) Accessed on 12/12/2010 Time 11:00 am

1.4 Aim: To examine the widen application of cheese in the Indian culinary use and
the consumption pattern and commercial trends of cheese in the country.

1.5 Research Purpose: The liberalization of the Indian Economy in the year
1991 brought about many economic reforms to the Indian Agriculture and Dairy
Industry. The liberalization made it possible to bring about the growth of these two

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industries.

The impact of all these reforms and the globalization of the country brought about
the evolution of the cheese industry in the country changing the import and export
patterns of this product and the consumption pattern among the population of the
country.

In India the relevance of all these factors cannot be ignored as they brought the major
change in the cheese industry and its consumption amongst the people.

1.6 Statement of Objectives:

1: To study the liberalisation of Indian economy and its effects on the dairy industry.

To study and showcase the economic liberalization process of the Indian Economy
and its simultaneous effects on the Indian Dairy Industry and the changes brought by
it.

2: To study the consumption pattern of cheese in India in the open economic phase
after 1991 in India:

To research about the consumption power and pattern amongst people with regards
to cheese and allied products due to the liberalization process.

3: To examine the upcoming and new commercial trends in the cheese industry in
India.

To look into the new trends coming up in the international and as well as the Indian
market and also in the developing cheese industry of the country.

4: To examine Indian consumers cheese consumption and allied cheese products

consumption pattern in the country and its exports.

To research upon the consumption pattern of cheese and allied products among the
consumers and the export of cheese from the Indian market to the International
market and the development of the industry to be the holder in the International
market.

1.7Reach & Inadequacy:

The potential issue with regards to the topic is that of it being of the observational
nature interviews and surveys among the general population cannot be conducted.

1.8 Research Structure: In this study, the researcher will broadly conduct
research using, the following two research methods:

Qualitative research (understanding of human behavior and the reasons that govern
such behavior)

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Quantitative research (systematic empirical investigation of quantitative properties

and phenomena and their relationships)

This means that apart from reading articles & books on the subject, the interview will
also undertake field research in the form of interviewing food industry professionals,
cheese suppliers, & other concerned individuals.

Primary Research: Interviews with professionals working in the food industry as

well as persons employed in the cheese supply industry.

Secondary research:

Desktop research

Books

Periodic journal

1.9Research Question: To find out the culinary application of different cheeses

in the Indian cuisine and consumption of it in the population.

1.10Hypothesis: Indian cheese consumption and culinary application has moved

in the global trend in the post liberal economic phase.

Due to the post liberal economy of the country the import and export of this product
has brought the growth of the cheese industry. Also the population of the country
being more knowledgeable has opened up to more and more interest in international
products for consumption and its application in the Indian cuisine.

Bibliography:
Web-Links/Articles

Antoon Cox, Italian cheese, sold in the US, made in India, Jan 13,
2008http://www.indianexpress.com/news/Italian-cheese,-sold-in-the-US,-made-in-
India/260933/ Accessed on 22/11/2010 Time: 11:53 am

http://www.chillibreeze.com/articles_various/Cheese-Industry.asp

Accessed on 22/11/2010 Time: 9:45 am

http://www.food-info.net/uk/dairy/cheese-production.htm

Accessed on 15/12/2010 Time: 22:30pm

http://www.india-reports.com/reports/Cheese5.aspx

Accessed on 18/12/2010 Time: 18:50pm

http://www.indianchild.com/india_economy_growth.htm

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Accessed on 19/12/2010 Time: 16:40pm

(http://www.indianexpress.com/news/Italian-cheese,-sold-in-the-US,-made-in-
India/260933/) Accessed on 12/12/2010 Time 11:00 am

(http://www.foodindustryindia.com/newfood/detailnews.=Cheeseconsumption)
Accessed on 13/1/2011 Time: 13:42pm

(http://business.mapsofindia.com/globalization/liberalization.html)

Accessed on 20/1/2011 Time 17:00pm

Articles:

CHEESE CONSUMPTION GOING UP IN INDIA, Author: Vincent Van Ross ,

New Delhi: Aug 7 2008 (http://topangle.instablogs.com/entry/cheese-consumption-
going-up-in-india/) Accessed on: 17/1/2011 Time: 12:15pm

Books:

 Wilfred Candler, Nalini Kumar(1998) the impact of dairy development in

India and The World Bank‟s contribution, World Bank Washington D.C.

 Baidyanath Prasad Singh(1995), Economic liberalisation in India,

Ashish Publishing House

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Chapter 2: Literature review: Liberalisation and the Indian Cheese

industry:

2.1 Liberalization in the 1990s

It was in the 1990s that the first initiation towards globalization and economic
liberalization was undertaken by Dr Manmohan Singh, who was the Finance
Minister of India under the Congress government headed by P.V. Narasimha Rao.
This is perhaps the milestone in the economic growth if India and it aimed towards
welcoming globalization. Since, the liberalization plan, the economic condition
gradually started improving and today India is one of the fastest growing economies
in the world with an average yearly growth rate of around 6-7%.

The Government of India began the economic liberalization arrangement in 1991. In

spite of the fact that the capacity at the centre has adapted hands, the pace of the
changes has never slackened till date. When 1991, updates within the streamlined
area in the nation were humble to express the slightest. The segment explained
simply one-fifth of the sum financial movement within the nation. The sectoral
structure of the industry has updated, though slowly. The greater part of the
streamlined area was overwhelmed by a select group of clan-based combinations that
had been overwhelming truly. Since 1991, a major restructuring has brought put with
the development of more innovatively progressed sections right around streamlined
communities. These days, more minor and medium scale endeavours give vitally to
the economy.

By the mid-90s, the private capital had surpassed general society capital. The
administration framework had moved from the universal clan based framework to a
framework of qualified and master administrators. One of the most obviously
foremost impacts of the liberalization period has been the development of a solid,
prosperous and light working class with imperative acquiring capacities and this has
been the motor that has driven the economy in light of the fact that. A different major
profit of the liberalization time has been the change in the design of fares from
customary articles love dress, tea and flavours to autos, steel, IT and so on. The
„made in India‟ mark, which did not bring out any sort of dedication has now ended
up a mark name without anyone else present and is now known everywhere on the
globe for its value. Moreover, the changes have transformed the instruction area with
a colossal talent pool of qualified pros now ready, holding up to vanquish the globe
with their space learning.

India, following every last trace of the aforementioned years of budgetary changes, is
at the junction. While restricted spearheads India to financial flourishing and
greatness, the alternate street advances it to social imbalance. Instantly, as India is
one of the snappiest developing economies in the universe, the social viewpoints
have been ridden roughshod by the financial profits. What has been advantageously
neglected or smothered till date have been the differences, essentially the socio-

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practical issues. This has spearheaded to developing discontent right around the
inhabitant total and it has garnered energy after the changes started 15 years back. It
will truly soon range a discriminating indicate wherein the exact reason for which the
changes were begun, will begin to lose their hugeness quickly and fling the nation
over into the „license raj‟ and „unionist‟ period.

The agrarian segment has moreover perceived this unbalanced development, as it is a

field that has been alternate stranded in the chase for farming changes. The segment
has been opened up to the multi-nationals, without having developed an extensive
blanket for our ranchers, the vast majority of who are abject and possess practically
nothing ground of their own. A for example is the spate of rancher suicides that our
nation has witnessed in the past few years. The improved nations, which clamor for
open-finished arrangements, have, actually, some of the fiercest insurance
arrangements when it approaches their horticultural area.

Modest scale industries (SSIs), the complete self of a considerable number of towns
and villages, have been virtually disregarded. Something greater than part of them
have shut down in the final few years in the appearance of compelling rivalry from
multi nationals who have unmatched money related and political muscle.

2.1.2 Impact of globalization and liberalization :

Globalization and liberalization has greatly influenced the Indian economy and made
it a huge consumer market. Today, most of the economic changes in the country are
based on the demand supply cycle and other economic factors. Today, India is the
world‟s 12th largest economy in terms of market exchange rate and 4th largest in
terms of the Purchasing Power Parity. According to a report by the World Bank, the
Indian market is expected to grow at around8% in the year 2010.

Globalization and liberalization has also made a positive impact on various important
economic segments. Today, the service sectors, industrial sectors and the agriculture
sector have really grown to a great extent. Around 54% of the annual Gross
Domestic Product (GDP) of India comes from the service industry while the
industrial and agriculture sector contributes around 29% and 17% respectively. With
the improvement of the market, more and more new sectors are coming up and
reaping profits such as IT services, chemical, textiles, cement industry and so on.
With the increase in the supply level, the rate of employment is also increasing
considerably.

There has been an improvement in the manufacturing sector as well which grew
from 8.98% in 2005 to around 12%. The communication segment has grown up to
around 16.64%. The condition is expected to improve further with more demand and
increase in customer base. The yearly growth of the industrial sector has been around
6.8 % which will rise more in the future. India is one of the well known industrial
markets in the Asia-Pacific region

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Source:

 http://business.mapsofindia.com/globalization/liberalization.html

Accessed on: 9/2/2011 Time : 22:30

 “India‟s Liberalization Era” Author: Phanikiran

http://www.chillibreeze.com/articles/India-liberalization.asp

Accessed on 9/2/2011 Time: 22:00

 http://www.indianchild.com/india_economy_growth.htm

Accessed on 11/1/2011 Time: 11:23

2.2 Liberalisation of the Dairy Sector and Acts by the Government

on the Indian Dairy and Cheese Industry:
The cornerstone of India‟s milk and cheese industry revolution has been the
cooperative dairy sector which was protected from cheap subsidized imports through
quantitative restrictions and by strict control over exports and imports through the
State-owned Indian Dairy Corporation. The competition from private sector was
controlled through licensing under the Industrial Development and Regulation Act of
1951, which discouraged new entrants into the dairy processing sector. A suitable
price-environment was created and is considered as a key for the impressive growth
in this sector.

All this changed in the early nineties when major financial and trade policy reforms
were initiated in all sectors of the Indian economy including the dairy sector. The
first step was to encourage private participation and the dairy industry was de-
licensed in 1991. That dairy is a lucrative business became obvious when within a
year of de-licensing, more than 100 privately-owned milk processing plants came up
in the major milk producing states.

Despite their numerical strength, the cooperative sector did not have the capacity to
compete against these private players flush with capital and fortified with modern
technology. Realising this, the government had to step in again and the Milk and
Milk Products Order (MMPO) was issued in 1992 under the Essential Commodities
Act (ECA) to regulate production of milk and dairy products. The MMPO
reintroduced licensing and also required private players to set up their own zones of
procurement (milk-sheds) that were beyond the existing milk-sheds of cooperatives.
This was done to check private players from poaching on milk-sheds of the
cooperative sector. However, swept by the wave of liberalization, the government

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again amended the MMPO in 2001 and allowed State governments to grant a one-
time license to the private sector, and also abolished renewal of license. In 2003,
restrictions on setting up milk processing and milk product manufacturing plants and
also the concept of milk-sheds were eliminated. The amended order emphasized
sanitary, hygiene, quality and food safety of milk and milk products.

As a result of the domestic policy changes mentioned above, the protection for dairy
products in India was drastically downscaled during the nineties. In the case of
Skimmed Milk Powder (SMP), it is actually negative. The nominal as well real
prices of milk and milk products have declined after reforms in dairy sector were
introduced in 1991. Notwithstanding the achievements of the cooperatives and
Operation Flood, this decrease in growth of prices has adversely affected the growth
of production of milk and milk products.

In addition to removing protection, a series of measures have been employed that are
subverting the cooperative dairy sector. Take for instance the prevailing system of
taxation. While primary dairy cooperatives at the village level are exempt from
paying income tax, the district and state level cooperatives are taxed at the rate of 35
percent. In 2006-07, the government reduced the income tax rate for private dairy
companies by 10 percent but did not reduce it for cooperatives.

2.2.2 The Lifting of Restrictions on India’s Domestic Dairy and

Cheese Industry:
India‟s dairy sector was regulated and protected through restrictions on imports and
exports of dairy products and domestic regulations until the early 1990s. The
industry became progressively more liberalized after 1991 as a result of changes that
culminated in the repeal of certain licensing requirements and the changes in the
Milk and Milk Products Order(MMPO) to reform India‟s dairy economy. Among the
restrictive measures contained in the MMPO that were eventually eliminated was
one that specified the milk sheds from which dairy processors could procure milk.

Before the 1990s, obtaining milk and processing and distribution to the population
was mainly in the hands of the cooperatives. Access for most proprietary firms in the
processing sector was granted only through licenses. As a inclusion of larger
economic reforms introduced in 1991, licensing of dairy industry firms came to an
end and the industry was then open to private cooperatives.

Within the duration of one year after the 1991 reforms, more than one hundred newly
developed private sector dairy plants were set up in the Indian dairy industry. Some
of cooperatives produced and sold adulterated and contaminated ilk products due to
which the government brought back a licensing system under the MMPO of 1992,
requiring state parameter of dairy plants making 10,000 to 75,000 litre of milk/day
and manufacturing of milk products containing 500 to 3750 tons of milk solids/year.

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Any dairy plant producing more products than stated by the government had to be
registered with the central government.

The 1992 MMPO classified “milk sheds” in reference to the area from which the
marketable surplus of milk was to find its way to a processing plant. The law in the
1992 MMPO in reference to the milk sheds was brought in action by the state or
central government Registering Authorities.

In 2001 the MMPO was changed to require compulsory registration only for bigger
plants that developed more than 20,000 litres/day . The MMPO was last amended in
2002 to bring the registration requirement to 200,000 litres/day and to remove the
state authority to give out milk sheds. Most of the private companies applauded the
end of the milk shed definition by the Registering Authority. Some of them were
able to expand their procurement area to a larger extent.

Source:

The Dairy Industry of India, India Study Team, Dairy Updates, Babcock Institute,
University of Wisconsin.

2.3 The Indian Cheese Industry:

The cheese industry in India has the potential to be a thriving one in the close destiny
owing to its expansive cheese-cherishing buyer base. Cheese is transformed in an
assortment of structures, from single slashes to cubes to spreads, with marks like
Amul and Britannia heading the method. Besides, owed to mainstream interest, it is
even sold in tweaked mixtures like pizza cheddar garnishes and cheddar sandwich
spread. Nonetheless, at present, the organised cheese industry is restricted to urban
devouring. Notwithstanding this truth, the development rate is looked for to ascend
in terms of worth and volume. With the blast in Indian retailing, the Indian cheese
industry is thought about to be a vowing field of gigantic infrastructure. “Cheese
Industry in India” breaks down the imperative angles of this industry for example
devouring, preparation, business sector inclines, its spearheading territorial and
national players as well as the rising marks in the business sector.

Source: http://www.chillibreeze.com/PPT-Reports/cheese.asp

Accessed on 10/2/2011 Time: 14: 40

Excluding for the famous Indian mixture of cottage cheese-Paneer, India is not
universally a 'cheese country'. With the developing immersion of cheese depletion in
the West and heartening strokes of good luck in alternate 'non-cheese' Asian nations
like Japan and China; abroad cheese makers are eyeing the Indian business for its

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gigantic pledge.

The organised cheese industry in India is at the very most in its incipient organize,
elucidating under 1% of aggregate dairy generation and substantially restricted to
urban devouring. However cheese was first promoted under the mark name 'Amul',
from the famous Amul margarine stable in the late 1970s, it achieved a character of
its possess just as late as 1990s.

The arranged cheese industry in the nation as of 2006, is valued at Rs 250 crore (US$
50 million), with a volume in overabundance of 8000 tonnes. The industry
development rate is gauged at about 10%-12% for each year in terms of volume and
16%-17% for each year in worth terms. Current family unit cheese entrance is 5%,
with about 50% of devouring being restricted to burbs. Mumbai and Delhi as a single
unit catch part of of the cheese business. Within cheese items, around 60% of the
business sector is commanded by handled cheese, 30% by cheese spreads and the
remaining 10% by flavoured and distinguishing offering cheese.

Now that its been brought up, Paonta Sahib, a place in Himachal Pradesh, uncovers
the cheese track from India to America. Indian Cheese industry was built by Man
Mohan Malik. This was once more in 1950s and recognized as a stupendous stride
towards the growth of Cheese Industry in India. It has been just uncovered that India
fares more cheese to America, than whatever available the Italian or European
Cheese industry.

However the prominence of cheese is not that enormous in India, yet the plenitude of
milk preparation has created the cheese industry in a much preferred way. As the
wild buffalo milk is thicker it was utilized more for the Cheese industry. In any case,
at first the Americans were grumbling for the cheese constructed of Buffalo milk. In
fact in India the milk is recognized to be „milk‟ no matter if it is from a buffalo or a
cow. The change was soon made to cow milk and Malik was absolutely into the
business.

He began preparing mozzarella cheese but as he was precisely unconscious of the

pure Italian mozzarella cheese, he was unable to adapt up. He then welcomed
Raffaele Cioffi to Paonta Sahib. Cioffi was from seashore of Sorrento and was the
fifth-cycle cheese-creator. He was a reliable specialist for cheese processes in Russia
and Bulgaria. This was a terrific stride sent by Malik. Not just this, Malik
additionally carried unique supplies from Germany for the motivation behind tracing
out the polluting influences in the milk. This was the start and was quite strong in
putting more value in the assembling unit.

The assistance made by Malik was so critical that in 2006, India traded Cheese in a
volume of 8000 tonnes; a worth of Rs 250 crore. The cheddar industry's development
rate has been evaluated to be of 10%-12% approx. for every year. With respect to the
amount, the gauged volume is building at the rate of 16%-17% for every year. It can
be decently evaluated that the Cheese industry in India is developing at a standard

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speed and will unquestionably have a keep over the International business sector of
Cheese business.

Source:
Antoon Cox, Italian cheese, sold in the US, made in India, Jan 13, 2008,
http://www.indianexpress.com/news/Italian-cheese,-sold-in-the-US,-made-in-
India/260933/ Accessed on 12/2/2011 Time 12:20

2.4 Cheese in India:

The composed cheese business incorporating its variants enjoy transformed cheese,
mozzarella, cheese spreads, enhanced and spiced cheese, is valued at around Rs 4.5
billion. Handled cheese at 60% of the on the whole business is Rs 2.7 billion. The
following most ubiquitous variant is cheese spread asserting a portion of around 30%
of the aggregate transformed cheese business. The business sector is basically an
urban wonder and is known to be developing at around 15%. The business sector for
cheese cubes, slashes and tins is developing.

The formed cheese business sector incorporating its variants enjoy transformed
cheese, mozzarella, cheese spreads, seasoned and spiced cheese, is valued at around
Rs 4.5 billion. Handled cheese at 60% of the for the most part business sector is Rs
2.7 billion. The following most ubiquitous variant is cheese spread asserting an
allotment of around 30% of the sum handled cheese business. The business is
principally an urban wonder and is known to be developing at around 15%. The
business sector for cheese cubes, cuts and tins is developing.

Britannia Industries united the fight in the cheese business sector in mid-1990s
through a course of action with Dynamix Dairy Industries (DDI). It was set up in
1995 by a consortium of five communities-Conwood, Indo Saigon, Hiranandani,
ETA and Metro. DDI has limit to technique 500,000 litres of milk for each day with
an evaluated speculation of Rs 1500 mn. The plant outlined by Valio of Finland is
run on engineering tie-up with Schreiber Foods of the US. Schreiber is the heftiest
supplier of prepared cheese to snappy sustenance chains in the US with smoothness
in slice cheese.

Britannia's cheese is sold in tins in the structure of solid shapes, and in separately
wrapped cuts in packs of fives and tens. The cuts are once again being furthered
more forcefully worldwide, and the aforementioned explain a majority of cheese
expenditure. These are expanding affirmation in India too. Amul accompanied
Britannia in starting cuts. Its cheese spread in the frame of glue has been generally
accepted in the business sector. Britannia has been thinking about metros and
expansive urban areas. The grid blankets some 60,000 dairy outlets outfitted with
biting bureaus, iceboxes and protected boxes. Amul blankets some 500,000 retail
outlets.

French cheese major, Fromageries Bel, a 10-bn French franc outfit, has dropped in
the Indian business sector with La Vache Kirit or what is worldwide regarded as The
Laughing Cow. Its target business to begin with were the a few metros of Delhi and
Mumbai with conveyance depended to Delhi-based Rai & Sons, merchants for
premium nourishment marks, Ferraro Rocher and Ricola. The Bel item can be

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processed at Bel's office in Poland only for the Indian business sector. La Vache
Kirit is an ensured vegetarian result.

Fromageries Bel is looked for to enlarge its item portfolio by starting snickering Kirit
(velvety cheese in solid shape structure) and Babybel (semi-hard with a wax
covering suitable for sandwiches). Chuckling Cow was looked for to be accompanied
by an Austrian cheese mark, Happy Cow (possessed by Woerle). Woerle has
engaged in a permitting game plan with Veekay Foods & Beverages in Mumbai.
Settle and Kraft have been wanting to make invasion in the Indian business.
Unfamiliar marks in India consider: Probolene, Colby, Mozzarella and Parmessan
from Italy, Cheese from Dutch, Gryueve. The brand new contestants will need to
contend with decently made players for example Amul, Britannia's Milkman and
Dabur's Le Bon, getting a charge out of generous pieces of the overall industry in the
for the most part Indian cheese business sector.

The US-based Philip Morris, which accumulated its Kraft cheese mark prior, has
expanded a huge presence in the business. The rest of the business sector is spread
right around Verka, Nandini, Vijaya and Vadilal. Dabur had forayed into the dairy
units business through its joint step ensemble, Dabon International, a 50:50 joint step
among Dabur India and French dairy items major, Bongrain.

The community asserted a result run of 20 different types of cheese under LeBon
mark. Dabon has an assembling office at Noida with an introduced limit of 12,000
tonnes for each annum. Of course, the administration had, in a move in late April
2001, banished Dabon from showcasing flavoured drain and prepared cheese in the
twang. Dabur was to start forte cheese like blue cheese and hard cheese. It had ideas
to advancing crisp chains at the wholesaler and retail levels in the state capitals and
major towns so as to build entrance levels.

The interest for cheese is imagined to develop from about Rs. 4.50 bn in 2003-04 to
Rs. 6.00 bn in 2006-07 and to over Rs 11.00 bn by the terminal year of the projection
period, 2014-15. Cheese is ending up a prominent part in the menu of all
proportionally princely tribes. Inefficiently but doubtlessly, it will infiltrate into the
provincial businesses.

Source:

http://smeinfoline.com/pdf/Guidelines%20agro/13.pdf Accessed on 14/1/2011 Time

5:30

2.5 Growth of the Indian cheese industry and its growing

consumption patterns and commercial trends:
Cheese and cheese products have ended up being uninhibitedly available just in the
1990s, following India decontrolled the dairy private sector and permitted the
unregulated passage of private part players into milk transforming. India's margarine
showcase is gauged to be 35000 tonnes, valued at US$ 76 million. The advancing

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cheese makers Amul, Vijaya and Verka command the business sector, while
Britannia is the sole private mark on the business sector. There are numerous
unorganized players in the fragment. Unlike alternate business sectors, where cow
milk is the principle fixing.

Cheese has come to be a class on the Indian business recently, although India has had
a cheese mark Amul, for numerous decades. The business sector has made a ton of
progress from the hard canned cheese obstructs of the eighties to a mixture of cuts,
shapes and spreads, with additional than five marks in the business. Notwithstanding,
tins are still truly mainstream in the Indian cheese business sector and explain
something greater than 50% of the cheese sold in India. Results are more and more
good to go in single serve arranges, and the mainstream origination of a cheese-cut
being the proportionate of a glass of milk has been successfully misused in
Britannia's successful fight focussed at fastidious youngsters.

Indian consumer taste is absolutely distinctive from the European: the major utilize
being as a breakfast supplementary part or a spread on breads, just soft and salty
cheeses for example Cheese, Camembert and Edam (aside from the mozzarella
which is in vogue for pizzas) have been affirmed in India, while some alternate
universe-famous aged cottage cheeses are essentially unsatisfactory in the mass
showcases. Cheese is the most mainstream cheese sold in India, and is for the most
part retailed in marked shape by the ordered division. Moreover, the majority of the
interest for Mozzarella cheese is indulged by the unorganised division.

Source: http://www.biztechreport.com/story/920-india-tops-world-cheese

Accessed on 15/2/2011 Time 14:37

2.5.1 Consumption patterns of cheese in India:

There have been two significant changes in consumption patterns, affecting each end
of the spectrum. In the mass consumption category, Indian consumers are more ready
to buy off the shelf. Paneer, which all the major cheese producers are marketing as a
branded product, was traditionally home made. Secondly, with greater international
exposure, rising incomes and brand affiliation; the demand for niche cheese products
has increased. Amul was an early mover in capitalizing on the demand for
specialized cheeses like Gouda and Emmental. However, cheese consumption
continues to be an urban phenomenon, with processed cheese and cheese spreads
accounting for about 80% of the total cheese consumption. Also, cheese is mostly
consumed by children and is yet to be part of the mainstream adult diet on a mass
scale.

India is one of the highest developing businesses for cheese with twelve-month
development pegged at 20% with a sum utilization of about 7,000 tons a year as per
an official of the Indian Agri-Commodity Federation. With one of the most
substantial shopper bases in the planet, cheese might be a multi-million buck

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industry in India. No place else do folks devour cheese in such a large number of
better structures and utilize cheese in such a large number of mixtures for India
cuisine.

In mother and pop stores as well as markets we identify tinned cheese and cheese
shapes which are salted and primed-to-consume; cheese spread which was presented
as a substitute for spread; cheese singles (slices) which are utilized as stuffing for
sandwiches; pizza cheese utilized as fixing on pizzas which are speedy ending up
being the inclined toward speedy sustenance in Indian metros. Amul has even
presented a level calorie form of cheese called “lean cheese.” Weight aware
individuals are gradually taking to this brand new item,” expresses Sandeep, a
representative at Krishna Stores in Delhi's upmarket Bengali Market region.

Best players of marked cheese assembling in India consider Amul, Britannia, Le

Bon, Mother Dairy and others. Out of said, Amul has a piece of the pie of 65% as per
an official of Agri-Commodity Federation. There are others for example Vita and
Vijaya who have a piece of the pie in the cheese business sector but their part is
inconsequential.

Around the same time as the final few years, the Indian cheese business sector has
developed unfalteringly at 15 to 20 for every penny for each annum consistent with a
business sector overview cited in the Indian media. The Australian cheese processor,
Kraft, has produced an advance into the Indian business accompanied by Remia of
Holland.

At first, the transported in marks of cheese were brought into Delhi, Mumbai,
Kolkata and Chennai and were belittled by ostracizes. Yet, now Indians too have
begun taking an extravagant for these nearly higher valued marks.

The urban residents elucidates major cheese depletion in India. Taken as one unit,
the four metropolitan metros viz., Delhi, Mumbai, Chennai and Kolkata deplete over
60% of the sum cheese sold in India. Mumbai tops the record with 30%, trailed by
Delhi at 20%, Kolkota at 7% and Chennai at 6%.

In littler towns and country ranges, shoppers still lean toward non-marked cabin
cheese transformed by nearby dairy holders called “paneer”. Unlike cheese cubes,
paneer is softer and tasteless and all Indian luxuries are made out of paneer. It
reaches in the business sector in impressive pieces that look such as pieces of bread.
It is cut, weighed and sold detached. Individuals incline toward cheese in the
structure of paneer on the grounds that they get new stocks ordinary. It is likewise
significantly more conservative as contrasted with marked cheese. Paneer offers at
100-140 rupees a kilo as in opposition to marked cheese which pitches at 200-250
rupees for every kilo.

Source:

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http://www.foodindustryindia.com/newfood/detailnews.jsp?n=Cheese%20consumption%2

0shooting%20up%20in%20India&id=390 Accessed on 15/2/2011 Time: 18:45

2.5.2Commercial Trends in the Indian Cheese Industry:

Designer packaging, refrigerated transportation, temperature-controlled storage and

attractive display of different varieties of cheese are part of the emerging market
strategy of cheese producers in the face of an encouraging upward trend in the
consumption of cheese products in India.

“The consumption of cheese in India is growing at a remarkable rate of 15-20% per

annum. Over 60% of the total consumption of branded cheese per annum comes
from metropolitan cities,” says Sharad Gupta, a longtime observer of the Indian dairy
industry and editor of “Dairy India-2007” which is a compendium of facts and
figures relating to various aspects of the Indian dairy industry.

In an effort to promote their brands and edge out competition, cheese producers are
encouraging departmental stores and retail outlets to make an impressive display of
their cheese products.

The key players in the cheese trade are: Gujarat cooperative Milk Marketing
Federation Limited which markets its products under the popular brand name
“Amul”; Britannia New Zealand Foods Pvt. Ltd. which has “Milkman” for a brand
name; and, Dabon International Pvt. Ltd. whose brand name is “LeBon”. All of them
are focusing on display as a tool for brand promotion. They are also looking at
display as a means to attract customer attention and loyalty.

Cheese products are packed in tins, glass bottles, plastic containers, foil wrapping
with glazed paper boxes, polythene packs and so on. Tinned cheese, which is usually
of the harder variety, is displayed in piles placing one tin over the other. The pile
tapers as it reaches the top. These are displayed alongside other tinned products such
as milk powder, health drinks, biscuits and a host of other products.

Cheese spreads are packed in glass bottles with tamper-proof metal lids and cheese
slices are packed in polythene packs. These are stored and displayed in refrigerators
with transparent doors. These varieties vie for space in refrigerators with soft drinks,
butter, cold milk/coffee and other beverages. Pasteurized processed cheddar cheese
and cheese cubes are stored in deep freezers. Fresh Paneer launched by LeBon
recently come in air tight packs and are stored in deep freezers. These cheese items
share their space with canned drinks, frozen foods and ice creams.

The shelf life of various branded cheese products range from 7 days for paneer to a
period that may extend up to one year for Cheddar cheese.

In the tug-of-war for market control of cheese products, the key players are focusing

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on tasteful display of their products to gain customer attention and brand loyalty

Source:

http://foodindustryindia.com/newfood/detailnews.jsp?n=Prominent%20display%20for%20

cheese%20on%20rising%20consumption&id=395

Accessed on 12/12/2010 Time: 15:30

Source:

 Public Private Partnership in Indian Dairy Industry, Initiating White Revolution –

II, By CH Technopak

 "How Can the WTO Help Harness Globalization?" by WTO Public Forum 4
– 5 October, 2007 Geneva
 Milk and Dairy Products in India - Production, Consumption and Exports,
September 2009
 http://www.biztechreport.com/story/920-india-tops-world-cheese

Accessed on 2/3/2011 Time: 14:14

 http://www.techno-preneur.net/information-desk/sciencetech-
magazine/2006/feb06/milk-based.pdf

 http://www.india-reports.com/reports/Cheese12.aspx

Accessed on 15/2/2011 Time: 14:40

 http://www.mindbranch.com/catalog/find.jsp?cat=od-dair

Accessed on 14/12/2010 Time: 17:30

 http://www.articlesnatch.com/gone.php?

Accessed on 12/12/2010 Time 12:45

 http://www.foodindustryindia.com/newfood/detailnews.jsp?

Accessed on 14/2/2011 Time: 12:40

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Chapter 3: RESEARCH METHODOLOGY

3.1 Introduction
The main aim of this chapter is to mention the research methodology used to
evaluate the process of research done. Here the researchers give details on how they
come to a conclusion and the different research tools used to gather and analyzed the
data collected.

There are basically two types of researches namely pure research and applied
research as shown below:

PURE RESEARCH is basic or essential research that is done mainly to improve the
researchers understanding of a certain problems that commonly occur in
organizational settings and finding remedies.

APPLIED RESEARCH is done with the intention of applying the results to findings in
order to solve problems or issues currently being experienced in an organization.
Therefore this research is only used when a problem evolves (Taylor, Sinha and
Ghoshal, 2009).

A pure research is carried out by the researches in this project. The researcher
would be contributing to the existing knowledge of a particular topic done in the past
by various scholars and researchers.

3.2 Type of Research

There are two reasons for which a research can be undertaken. The first being, to
find a solution to a problem that already exists within the work place, and the second
one is done to educate oneself more about a particular problem and then try to
contribute in general to the body of knowledge in that section without any intentions
of applying the results found to solve any precise problem in that organization.

3.2.1 SECONDARY RESEARCH

In secondary research, the researcher has some amount of data available, the
researchers do not need to start from scratch they can use the data or information
done in the past by various scholars and researchers (Gill, J. and Johnson, P. 1997).

The secondary research helped the researcher have a better understanding of the
various ideas, strategies and innovative concepts being practiced around the world.
The researcher was also able to study the new and upcoming trends being adopted in
the global dairy and cheese industry.

3.3 Purpose of the Research

Methodology is concerned with the way in which an answer can be stated to a
research question and particularly the process undertaken to achieve this answer,

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solution or recommendation (Robson, 1993). Therefore, research denotes a planned,

structured and systematic method of analysis. The purpose of the research is defined
by the type of research. It seeks to inform the reader what the researcher wants to
accomplish and how its outcome or the result can be used.

Robson (1993) clubs the purpose of research in terms of descriptive, explanatory and
exploratory:

A Descriptive research is done when a clear profile of persons, events or situations

has to be displayed. It requires deep research of past data in the domain so that the
researcher can ascertain the aspects on which information has to be gathered.

An Explanatory research finds a core of a situation or problem, generally expressed

in the form of causal relationships. It may be quantitative or qualitative or a
combination of both.

An Exploratory research is undertaken when the purpose of the study is in depth or

to ascertain what is happening. It is carried out to determine new areas, ask questions
and to assess phenomena in a new ways. It is usually qualitative.

Based on the above categorization, this research may be classified as a descriptive

research. The study aims to identify the consumption patterns and commercial trends
used by the cheese industry for supplying the demand of the cheese within the
country and also internationally. The data was first evaluated and then a hypothesis
was deduced from it. Qualitative data was then collected to authenticate the
hypothesis.

3.4 Formulation of Research Tools and Collecting Data

The hypothesis generated above has to be validated by further collection of data. The
decision to collect data using quantitative or qualitative techniques depends on the
research design which identifies the research purpose, research problems, and
research settings, background of the investigator and research methods (Bogdan, R.
and Biklen, S. 1982). According to the researcher qualitative data collection was
justified for this project.

3.4.1 Qualitative Data

Qualitative research sees the world through a qualitative lens, according to Miles and
Huberman (1997). Furthermore, it explores meaning and often precedes quantitative
research. There are several reasons why the researcher used qualitative data for the
study. Firstly, the purpose of the research was descriptive in nature. Therefore, a
qualitative approach to collecting data would not only bring more detail but also
allow flexibility of data collecting depending on the persons view and their
involvement in context of the research.

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3.5 Data Analysis

The data collected from the previous findings by scholars and statistics provided by
the government and the cheese industry, will be analyzed to assess whether the
cheese industry is utilizing all their resources and innovative ideas in order to raise
the business and to supply cheese and cheese products for the required demand.
Examine the ideas which could be practiced in the cheese industry to boost the
revenue inflow by putting various transformations into action with the help and
recommendations to formulate strategies. The data collected from the qualitative
research will then be compared to that of the findings in the literature review thus
forming a certain perception about the entire research (Taylor, Sinha and Ghoshal,
2009). The researcher on the basis of the given market statistics of the cheese
consumption and the import and export of cheese within the country will analyze and
the answers would then be evaluated.

3.6 Interpretation and Deduction

The researcher aims to draw the inferences from the data gathered and the conclusion
is arrived at, by comparing the data gathered from the primary research tool and the
published literature, as studied in the literature review (Taylor, Sinha and Ghoshal,
2009). Final discussion will be constructed, and recommendations will be made as
suitable to the case study.

Hypothesis: Indian cheese consumption and culinary application has moved in

the global trend in the post liberal economic phase.

Due to the post liberal economy of the country the import and export of this product
has brought the growth of the cheese industry. Also the population of the country
being more knowledgeable has opened up to more and more interest in international
products for consumption and its application in the Indian cuisine.

3.7 The Rationale

All the data has been collected keeping in the mind the purpose for which it is being
administered. In the next chapter are the detailed explanations to the reasons behind
the specific data collected.

3.8 Objectives
Following are the objectives of this research:

3.8.1

To study the liberalisation of Indian economy and its effects on the dairy industry:

To study and showcase the economic liberalization process of the Indian Economy
and its simultaneous effects on the Indian Dairy Industry and the changes brought by

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it.

3.8.2

To study the consumption pattern of cheese in India in the open economic phase after
1991 in India:

To research about the consumption power and pattern amongst people with regards
to cheese and allied products due to the liberalization process.

3.8.3

To examine the upcoming and new commercial trends in the cheese industry in India:

To look into the new trends coming up in the international and as well as the Indian
market and also in the developing cheese industry of the country.

3.8.4

To examine Indian consumers cheese consumption and allied cheese products

consumption pattern in the country and its exports:

To research upon the consumption pattern of cheese and allied products among the
consumers and the export of cheese from the Indian market to the International
market and the development of the industry to be the holder in the International
market.

As the researcher is a part of the hospitality industry, and he has across information
on the consumption of cheese in hotel events and has been introduced to different
types of cheese and cheese products national as well as international therefore, his
curiosity to know more about the industry motivated him to study this topic as his
dissertation project. In order to make the study more concrete and to achieve their
goals the researchers have used the tools of primary research which refers to,
interviews etc and secondary research which refers to the study of past research,
books, e-journal etc, which helped to collect data required for the researcher to
derive a conclusion.

Source:

Bogdan, R. and Biklen, S.(1982),Qualitative Research for Education: An

Introduction to Theory and Methods, Allyn & Bacon, Bostan.

Gill, J. and Johnson, P. (1997) „Research Methods for Managers‟, London: Paul
Chapman Publishing.

Miles, M. B. and Huberman, M. (1994) Qualitative Data Analysis: An Expanded

Sourcebook, 2nd Edition, Thousand Oaks, CA: Sage Publications.

Oppenheim, A.N. (1992) „Questionnaire Design, Interviewing and Attitude

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Measurement‟, Continuum, London and New York.

Robson, C. (1993) „Real World Research‟, Oxford (U.K): Blackwell Publishers Ltd.

Sekaran, U. (2003) Research Methods for business: A skill-building approach, New

York: John Wiley and Sons.

Taylor. B., Sinha. G. and Ghoshal. T. (2009) „Research Methodology‟, 4 th ed. New
Delhi, PHI Learning Private Limited.

Moore, P.G. (1970) „The Myth of the Percentage Sample‟, Journal of Management
Studies, Vol 7, No. 2, 145.

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Chapter 4: Results and Discussions

4.1 Liberalization and its effect on the Dairy and Cheese Industry:
Table 1:

Milk Production in India post the liberal economy of India:

Year Production(Million Tonnes) Per Capita
Availability(gm/day)
1991-92 55.7 178
1992-93 58 182
1993-94 60.6 187
1994-95 63.8 194
1995-96 66.2 197
1996-97 69.1 202
1997-98 72.1 207
1998-99 75.4 213
1999-00 78.3 217
2000-01 80.6 220
2001-02 84.4 225
2002-03 86.2 230
2003-04 88.1 231
2004-05 90.7 229
2005-06 94.6 232

Source: State/UT Animal Husbandry Departments, 2004

*Source: Production Estimate of MILK, EGG, MEAT and WOOL of the year 2004-
2005

Table 4.1 clearly shows the increase in production of milk post liberalisation of the
Indian economy. The Indian dairy and dairy product sector shows a gradual increase
in the milk production of the country over the years which was earlier restricted due
to the stringent policies of import and export and also laws that were imposed by the
government of India on dairy and dairy producing organisations and small scale
farmers. With the liberalisation coming in action these set of laws and policies were
changed keeping in mind the organised and the unorganised dairy and cheese
industry of the country which employed a population of 90million people of the
country and their development on the national as well as the international level by
the government of India.

India‟s dairy sector was regulated and protected through restrictions on imports and
exports of dairy products and domestic regulations until the early 1990s. The
industry became progressively more liberalized after 1991 as a result of changes that
culminated in the repeal of certain licensing requirements and the changes in the
Milk and Milk Products Order(MMPO) to reform India‟s dairy economy. Among the
restrictive measures contained in the MMPO that were eventually eliminated was

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one that specified the milk sheds from which dairy processors could procure milk.

Before the 1990s, obtaining milk and processing and distribution to the population
was mainly in the hands of the cooperatives. Access for most proprietary firms in the
processing sector was granted only through licenses. As a inclusion of larger
economic reforms introduced in 1991, licensing of dairy industry firms came to an
end and the industry was then open to private cooperatives.

Within the duration of one year after the 1991 reforms, more than one hundred newly
developed private sector dairy plants were set up in the Indian dairy industry.

The 1992 MMPO classified “milk sheds” in reference to the area from which the
marketable surplus of milk was to find its way to a processing plant. The law in the
1992 MMPO in reference to the milk sheds was brought in action by the state or
central government Registering Authorities.

In 2001 the MMPO was changed to require compulsory registration only for bigger
plants that developed more than 20,000 litres/day . The MMPO was last amended in
2002 to bring the registration requirement to 200,000 litres/day and to remove the
state authority to give out milk sheds. Most of the private companies applauded the
end of the milk shed definition by the Registering Authority. Some of them were
able to expand their procurement area to a larger extent.

Source:

The Dairy Industry of India, India Study Team, Dairy Updates, Babcock Institute,
University of Wisconsin.

4.2 Consumption of Cheese and allied products in India:

Since the liberalisation of the Indian economy the world saw a major increase in the
production of milk in the country. Laws and policies which earlier hindered the
growth of the cheese industry now helped in the increase of the industry. The surplus
of milk production led to increase production of cheese and allied products in the
country. Development in the technology brought new techniques and methods which
helped in the better production of cheese products. Exposure towards the foreign
continents gave the working class of the cheese industry an insight in the
international work procedure and the ways of producing cheese and allied products.
Training in these new methods of cheese production the Indian cheese producers
were better equipped to meet and follow the international standards made by other
countries. The working middle class of the country was also exposed to international
products offered by these countries. With the changes in the import and export
policies after the liberalisation these middle class population had access to these new
cheeses and cheese products. Also different international cheese makers made their
way into the Indian markets introducing these consumers to their products at an
affordable price allowed the consumers to try out these products. With the rising

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educated class educated in different areas of food and ingredients were bold enough
to try out these cheeses and also liked the products. Different events were held to
make the higher society aware of these products and bringing a general awareness in
the society towards these new cheeses. New flavours were also introduces to suit the
Indian palette which led the consumers liking of these products bringing an increase
in the consumption of cheese and allied products in the country. The period from 1991-2001
saw an increase in the consumption patterns of cheese and allied products in the country
after the liberalisation of the Indian economy.

Table 4.2

Demand of cheese and allied products in the Indian market:

Cheddar 50

Cheese Spread 30

Mozzarella 10

Favoured 3

Spiced 2

Others 5

Source:

Annual Report, 2000-‟01, Ministry of Food Processing Industry

http://www.icpeenvis.nic.in/icpefoodnpackaging/pdfs/15_milk.pdf

The above table shows the demand of the cheese and allied products in India post the
liberal economy of India. The urban population of the country was introduced to new
cheese and allied products by the international makers and developed a liking for
them thus bringing an increase in demand for these products from the cheese
industry in India.

4.3 Upcoming commercial trends in the cheese industry:

The organized cheese market including its variants like processed cheese,
mozzarella, cheese spreads, flavoured and spiced cheese, is valued at around Rs 4.5
billion. Processed cheese at 60% of the overall market is Rs 2.7 billion. The next
most popular variant is cheese spread claiming a share of around 30% of the total
processed cheese market. The market is primarily an urban phenomenon and is
known to be growing at around 15%. The market for cheese cubes, slices and tins is

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growing. The flavoured cheese segment has been constantly declining.

Gujarat Cooperative Milk Marketing Federation (GCMF) with the Amul brand
continues to be the main operator in the branded cheese market in India. It
pioneered the market for processed, branded cheese. What GCMF did was to
develop the technology to make cheese from buffalo milk. World over it is made
from cow milk. International cheese makers have forayed into the Indian cheese
market and have introduced the urban population with newer cheeses and allied
cheese products and the Indian consumers have developed a liking for it as well.

Better packaging to attract kids and also giving out toys as freebies to the younger
generation is another upcoming trend to attract the younger generation of the
country. The other methods to attract the older generation of the country is by
displaying the health benefits of the consumption of cheese which is displayed on the
packaging and also by advertising this information through various methods through
different media.

The introduction of new flavours and specially Indian flavours is another way to
attract the Indian consumers making these products more suitable to the Indian
palette. Bringing out of new flavours through cheese spreads according to the market
needs and consumer surveys to increase the consumption and offering various offers
to the consumers is one of the most effective method to capitalize and make a mark
in the market which is used by these cheese producers in the Indian cheese market.

Introduction of new technology, new machinery better handling and storage is also
brought in application that has helped in the production of better quality of cheese
and allied products in the country. Indian cheese producers also have started
importing new machinery from foreign countries to improve the international
standards of cheese production and be at par with international cheese makers.

4.4 Import and Export of cheese in India:

With the surplus of milk produced in the country. Milk is used in making different
types of cheeses. Most of these cheese and allied products are used to satisfy the
domestic needs of the Indian market itself. Fresh cheeses like ricotta and feta are
imported on a larger scale in the country for its similarities with Indian cottage
cheese (paneer). Cheese like blue veined cheese which are recently introduced to the
Indian market are imported on the larger scale for the consumers have taken a liking
for it.

Cheeses like mozzarella and cheddar are exported on a larger scale as they are easily
produced in the country using the Indian milk. People from the cheese industry being
trained in the process of making these two cheeses are highly skilled in making these
cheeses at international standards due to which the export of the cheese around the
world in the country is larger than any other cheese.

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Thus with lifting of restrictions and changes in the import and export policies in the
country India has made a mark for itself in the world cheese market.

4.5 Hypothesis: Indian cheese consumption and culinary application has moved
in the global trend in the post liberal economic phase. Due to the post liberal
economy of the country the import and export of this product has brought the growth
of the cheese industry. Also the population of the country being more knowledgeable
has opened up to more and more interest in international products for consumption
and its application in the Indian cuisine.

Source:
 Opportunities And Challenges in The Indian Dairy Industry, by Dr K.G.
Karmakar and Dr G.D. Banerjee
 The 2009 Import and Export Market for Unfermented Fresh Cheese in India,
by ICON Group International

 http://www.biztechreport.com/story/920-india-tops-world-cheese

Accessed on 2/3/2011 Time: 14:14

 http://www.indianexpress.com/news/the-indian-cheese-spread/493664/0

Accessed on 12/2/2011 Time: 15:00

 http://www.iisc.ernet.in/insa/ch22.pdf

Accessed on 12/12/2010 Time: 21:20

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Chapter 5: Conclusion and Recommendations

5.1 Summary:
The economic liberalisation of the Indian economy brought about changes in every
sector of the Indian industries. The dairy industry and subsequently the Indian cheese
industry were majorly affected. The economic reforms brought by the Indian
government led to the development of the Indian cheese industry from a small scale
industry to an international one.

The researcher makes an effort to study liberalisation made by Dr. Manmohan Singh
in the year 1990. The researcher showcases the growth in the industry and also the
changes in the Indian consumer consumption of the cheese and its allied products.
The research also shows the path of foreign cheese makers into the Indian market
and the changes made by them in the Indian Cheese industry and the changes in
consumption patterns and commercial trends in the cheese market within India.

5.2 Scope and Limitation:

Being a qualitative research topic the lack of primary information on the topic did
cause an obstacle to give complete justice to the topic. Secondary sources even
though in abundance did not specifically aim at the Indian cheese industry but rather
at the dairy development within the country.

5.3 Main Findings:

The cheese industry tries a significant function in the socio-investment growth of
India. The cheese industry in India is instrumental in giving cheese and cheese units
to the unlimited residents of India and in addition produces gigantic vocation
openings for folks in provincial situations.

India is a wonderland for investors searching for venture chances in the cheese
industry. The cheese industry keeps terrific potential for venture in India and pledges
towering comes back to the investors.

The reasons why the industry has huge potential for attracting new foreign
investment are:

1.There is a basic raw material need for the cheese industry; that is, milk is available
in abundance.

2. India has a plentiful supply of technically skilled labourers.

3. There is an easy availability of technological infrastructure.

4. India has all the key elements required for a free market system.

India is the quickest emerging economies today. With the government heartening

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foreign Investments in India, it has become easier for foreign organisations to enter
in the Indian Markets. The Indian cheese industry was established back in the 1950s
and now exports more cheese than any European country. Amul a brand that entered
the marketplace - is capitalizing on the requirement for specialized cheeses like
Gouda and Emmental. Processed cheese and cheese spreads account for about 80
percent of total cheese utilization. Children are the chief contributors to this market
upscale, though it increasingly forms part of the mainstream adult diet. Cause of
inadequate shelf life of cheese product and need of advanced packaging, processing
and distribution technology, many regional cheese brands are not able to retail
nationwide. The Indian cheese industry is said to be attracting a large number of
entrepreneurs. People believe that success depends on factors such as competent yet
cheap procurement network, hygienic and cost-effective processing facilities in the
marketplace. High demand has resulted in a number of mergers within the industry,
which has contributed to enhance efficiency including investments into new packing
and storage.

The two branched scheme that sellers will follow in the next few years is i) to
increase the size of the market through greater awareness, and ii) to increase
availability of cheese products to the market.

The next three years will see new Indian flavours of cheese being introduced in the
processed cheese and cheese spread market. The Indian consumer has unique tastes
with variations even across regions. Both Indian and International brands are likely
to 'Indianize' their cheese products with Indian flavours to attract a larger customer
base

The dairy and cheese industry has stood a model to the various dairy programmes for
nations around the world. Dr Kurien's white revolution has been eagerly absorbed by
most of the progressive dairies in their attempt in taking up the challenge of growth
and development.

With 105 million tonnes and a dream to reach 180 million tones by 2020, India
surely is the dairy and cheese products leader, but for it to be accommodated in the
bracket of the best there are still ladders to climb weaknesses to overcome.

5.4 Recommendations:

The upcoming trends in the cheese industry do not have any limits, there are many
new trends coming up in cheese industry and many are been talked about. With the
course of time there will be huge trends that will come up that the cheese business
will spread up in an endless aspect. Standards have changed. Customers want bolder,
more exciting flavours. But the greatest palette changes are likely still ahead. It is
supposed that need is the mother of all inventions. It is the business need that is
forcing re-invention of cuisines that are liked but have not been explored entirely. In
the world of cheese where contemporary cheese is flourishing, cheese exhibitions,
tasting menus and food and wine pairing events act as the perfect place for the
people to taste different food under one roof. Consumers should be attracted towards
the cheese and allied products with better and attractive packaging to call out to the

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kids and give out attractive offers so that adults may purchase these products. Also
the urban population mainly the growing middle class of the country should be made
aware of the different cheese and products available in the country introduce them to
new flavours so as to increase the consumption of these products in the country. Also
the government should introduce new plans for the small scale cheese producers in
order to develop the cheese industry in the country.

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