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Ratna Bhushan
Harish Damodaran

New Delhi , Oct. 15

IT is probably the first instance of a local halwai establishing an overseas production base. The Delhi-based Bikanervala Foods Pvt Ltd is in the process of setting full-fledged units for manufacturing traditional Indian sweets and namkeens (ethnic snack foods) in Canada and Dubai.

The Canada factory would service a chain of six exclusive Bikanervala outlets that the company proposes to establish in the US and Canada over the next three years. "Our first Indian fast food outlet-cum-sweet shop in the US will take off in New Jersey within the next 6-8 months," Mr Shyam Sunder Aggarwal, Managing Director of the Rs 100-crore Bikanervala Foods told Business Line.

Bikanervala Foods is currently the contract manufacturer for major Indian namkeen brands such as Lehar of PepsiCo's Frito-Lay India and Aa Jaa Khaa Jaa of Mother Dairy Foods Ltd.

Mr Deepta Gupta, General Manager, Bikanervala Foods, said that the manufacturing facility in Canada would involve an initial investment of about $ 0.5 million (Rs 2.2 crore). The factory is basically a joint venture with a Toronto-based NRI, who would also be a master-franchisee for Bikanervala's outlets in Canada.

"Setting up an overseas production base would help us maintain freshness in our products and increase their shelf-life for the consumer. This is not possible in the case of exports, which normally involve a transit time of 5-6 weeks," he added. Further, under the North American Free Trade Agreement (NAFTA), the products manufactured in Canada will not attract any duty in the US.

Mr Gupta said that while the raw materials for making sweets, such as khoa (partially dessicated milk) and paneer, would be sourced from Canada using local milk, the spices and other essential namkeen ingredients like roasted moong dal would be imported from India.

Mr Aggarwal said that Bikanervala's Dubai manufacturing unit is to begin production within the next 3-4 months. The company had, only in May, opened its retail outlet in Dubai. Bikanervala Foods also has a presence in Nepal, through three outlets in Kathmandu that have been functional in the last eight years.

According to Mr P.R. Gupta, Editor of Dairy India publications, companies here have not fully exploited the huge overseas market potential for indigenous sweets and snacks. The market for Indian milk-based sweets in North America alone is estimated at $ 500 million. "Taking advantage of the huge Indian diaspora (1.6 million in the US, 0.9 million in Canada and 1.2 million in UK), a lot of entrepreneurs in those countries are already looking into the prospects of producing these locally, as is evident from an increasing number of enquiries received here for equipment to manufacture paneer, khoa, shrikhand, gulabjamun, etc," he pointed out.

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Bikanervala to set up units in Canada, Dubai

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