India – the emerging hub of nutraceuticals

The Indian nutra industry is poised to realise the $100 billion dream, suggests a recent survey by Nutrify Today.

2016 turned out to be the year that the nutra industry began to take off in India and both the trajectory as well as the industry have since undergone a seismic evolution.

Similarly, 2020 was a game changer. The industry’s growth rate made a quantum leap from the predictable trends of 10 per cent to over 26 per cent during the COVID-19 pandemic, eventually stabilising since late 2021 at 16-18 per cent, surpassing global industry trends.

As well as an impressive trajectory, the industry underwent a holistic change, underpinned by science. This resulted in a surge in clinical trials with consumers, finally validating the claims of the producers. The change is now irreversible and the shift is positive. Market accessibility was another factor to the industry’s growth, thanks to the government-run pharmacies stocking up nutraceuticals.

Another major catalyst of growth was the formation of the Nutraceutical Task Force, tasked with shaping policies to transform the Indian nutra industry into a $100 billion industry by 2030.

The biggest game changer was an increase in the overall number of Indians consuming basic nutraceuticals during the pandemic. The ‘nutraceutically-dormant’ Indian community had finally woken up, and so had the industry. According to the Nutraceutical Task Force, over 640 million Indians took to basic nutraceuticals during the pandemic.

To fuel the growth and modernisation of the nutra industry, five essential pillars of positive growth and change are also taking shape:

1. Medicinal plant farming: India is home to 52 agro-climatic zones. This advantage, coupled with an improved Biological Diversity Act, (the Biological Diversity (Amendment) Bill, 2021) with the aid of IT applications in consonance with blockchains, is driving the creation of a finger-printed, raw material supply chain.

2. Active nutra ingredients: India is geared up to tap into its rich active nutra ingredient potential by accessing over 1,700 medicinal plants from Ayurveda. This resource base alone has the potential to propel India into the $200-billion league.

3. Formulation ecosystem: India is home to a vast number of world-class GMP facilities. This is a spin off from India having the largest FDA-approved contract manufacturing facilities in the world, with additional high-end, nutra manufacturing facilities, usually audited by pharma companies. This spin-off effect means India has the potential to become a global contract manufacturing hub in nutraceuticals. Moreover, the pharma delivery technologies can also be applied here to churn bio-available, disruptive nutra formations.

4. The start-up ecosystem: India is home to 7,400 nutra start-ups backed by high-end incubation hubs such as CCMB, IITs and other institutions. Start-ups are leading to a technological revolution across the entire eco-system.

5. Academia: The Nutrify Today Academy is working closely with the Centurion University, to launch nutra industry-specific post-graduation courses, the first of a kind. More widely and importantly, universities are collaborating with the industry to develop industry-specific courses and programmes.

The survey

The thinking behind the survey conducted by Nutrify Today was to identify the gaps to be filled in order for India to realise its nutra potential as a $100 billion industry by 2030.

The four-month survey covered the Indian nutra industry and community, interviewing more than 2,000 executives, including senior and middle management professionals and owners of nutra firms and businesses. Other stakeholders, such as academia and investors, were also included in the group.

The survey revealed the supreme confidence the stakeholders had in India realising its $100 billion potential by 2030. In fact, 91.5 per cent of those surveyed were ‘absolutely sure’ that India Nutra Inc would reach its target by 2030. However, 48.2 per cent made it clear that a major gap that needs to be addressed is the lack of a dedicated nutra department in the government, which, they felt, should be immediately addressed for the growth potential to be achieved. Dr Vivek Srivastava, Senior Vice-President, Innovation, Business Strategy and Scientific Affairs,
Zeon Life Sciences, stated, “As a nutraceutical industry, we strive to offer the best product to manage health conditions. However, it is imperative to come out with policies, which are more relevant to trigger innovation and we look forward to paramount support from the government in this direction.”

Confusion around regulatory issues and the absent Harmonised System of Nomenclature (HSN) duties were a major cause of concern. Of those surveyed, 40.1 per cent raised concerns over the evolution of regulatory policy, partly because the industry is not so involved in shaping the rules, which have been evolving at a rapid pace. This calls for greater consultation and engagement with the industry. As for the missing HSN codes, the industry stakeholders felt that this was hindering the applicable duties.

One of the major surprises that emerged was the lessened demand for the Performance-Linked Incentives (PLIs) offered by the government. This could indicate that India Nutra Inc is confident that it is developing organically and relying on the abundantly available natural resources. The Biological Diversity Act, 2002 proves to be problematic, despite the recent modifications (via the Biological Diversity (Amendment) Bill, 2021) as 25.4 per cent of those surveyed felt it was a cause of concern. Some of the senior stakeholders also warned that the chasm between nutrition and nutraceuticals needed to be bridged. Aditya Malviya, Business Head, India, IFF Health, said, “At a personal level, it (the survey) clearly indicates that the industry does not understand the difference between nutrition and nutraceuticals. What the government wants is nutrition for the people and what the industry wants is nutraceuticals for profits and a new market segmentation.

“The government is looking at $100 billion industry, primarily for nutrition, through AYUSH, coupled with Food Safety and Standards Authority of India (FSSAI), to regulate the irresponsible way in which the industry is talking about nutrition in the guise of nutraceuticals. Nutraceuticals is essentially part of pharmaceuticals and should be dealt with that way only. Taking nutraceuticals directly to the consumer without the support of the medical fraternity would be the biggest health disaster by the industry. Unfortunately, many companies are trying to do this, this is unfortunate for a country the size of India.”

This was felt by 38.6 per cent of those surveyed who pointed out that there was a dearth of clinical studies in the industry in India – however, since the pandemic and increasing awareness of consumers, some believed this issue was starting to be addressed. The essential gap pointers made it absolutely clear that proper clinical studies, corroborated by the medical fraternity, would lay the foundation for trust. “Nutraceuticals should be treated at par with pharmaceuticals and the aim should be to take nutraceuticals to pharmaceuticals for the enabling of trust and opportunity. Unless and until doctors prescribe nutraceuticals, trust will never come, disinterest tends to lack of awareness, it’s a merry-go-round,” observed Anil Jain, Managing Director, Gangwal Chemicals.

Another major issue raised during the survey was a lack of consumer awareness, with over 50 per cent of those surveyed believing the lack of consumer awareness is still the biggest hurdle in India. Ram Babu, Managing Director, Pulse Pharma, said, “Consumer awareness… Lack of health consciousness, we still want to think of health only when something has gone drastically wrong with body and mind.”

Finally, 70.6 per cent raised one common concern: that of the lack of trained professionals in nutraceuticals. What if this alone were to become the biggest hurdle, despite all the efforts by the industry, Task Force and government? Expressing concern over this issue, Sanjay Mariwala, Executive Chairman, Omniactive Health Technologies, said, “The nutraceuticals industry in India requires development of creative human resources. Innovative ideas are what consumers are paying for and demanding. Brands will need to create innovative products, and for that, they need supply chain partners who can creatively use science and technology to craft such products, that are efficacious and deliver the value desired. The investment in recruiting, training and developing the right manpower will go a long way in shaping the future of companies and countries that will emerge as leaders in this space.”

The Nutrify Today Academy has estimated an HR deficit of more than 160,000 qualified personnel and understands the urgent need to address this in order to come close to achieve the $100 billion target. With this in mind, the company is working with the industry through its AI platform to help design differentiated, responsible nutra portfolios, while engaging with academia and universities, such as Centurion University, to develop industry application courses for post graduate students in pharmacy, nutraceuticals, food tech and chemical engineering. The survey has clearly indicated that India is the emerging hub of nutraceuticals, and, according to experts, it’s a trend which offers a wealth of opportunities for India Nutra Inc, outside the US.