The FMCG-packaged foods industry is the only one under the TARI-FICCI-CASCADE study which shows a declining grey market size – from 23.4% in 2012 to 21.7% in 2014. This is also accompanied with a relatively higher number of patents but low R&D expenditure and GVA, increasing use of indigenous inputs and declining trend of imported inputs and finished goods.

These confusing and contradictory signals indicate that producers have found ways to beat grey markets without significant innovation or investment in products, which could be explained by the nascent stage of the industry, which is rapidly growing, and use of innovative and state-of-art packaging which doesn’t involve capital investment. However, to sustain high growth and momentum, the industry would have to invest in product innovation R&D. For further details please view our report.…