The Hindu Business Line : `Popularise coffee in rural areas'

INDIA may be the world's fifth largest producer of coffee with an annual output of about three lakh tonnes, but its domestic consumption is woefully low with condoms, sanitary napkins and even lipsticks outselling it in rural areas.

"Coffee has become an urban phenomenon in India. It is going out of fashion in rural India," said Mr Harish Bijoor, CEO of Harish Bijoor Consults Inc. "Penetration of condoms, lipsticks and sanitary napkins are higher than coffee (in rural areas)."

Speaking at the India International Commodity Fair here on Wednesday, Mr Bijoor, an ex-Tata Coffee official, said the Indian coffee sector should stop chasing the export market when the domestic market offers huge potential.

"We have to broad-base coffee. It's a very niche market today," he said, pointing toward the low consumption of coffee in the country, stagnating at around 55,000 to 60,000 tonnes a year.

He said the per capita consumption of coffee in India is just 58 grams as against 12,000 grams in the US. "Even in Pakistan, the per capita consumption of coffee is higher," Mr Bijoor said.

In 1961, as many as 3,741 various brands of coffee existed in India, but the number has now come down to 236. The failure of the industry to come up with customised flavours at the right price points was one of the main reasons for the decline in coffee drinking in the country.

"We need to popularise coffee at Rs 150 a kg in rural areas," Mr Bijoor said. Unless coffee becomes a popular drink in rural areas, the industry will not succeed in the country.

Although coffee chains such as Barista have cropped up in cities, even there, the consumption is very little. 393 coffee outlets together sold just about 600 tonnes of coffee in one year.

The coffee sector should follow a co-operative model to popularise the drink, build regional brands, develop recipes and take to the vending route in rural areas, Mr Bijoor said.

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