Food and Beverage Business
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Danone India’s Investment Strategies Indicate a Comeback in Dairy Products

Danone India’s Investment Strategies Indicate a Comeback in Dairy Products Danone Food and Beverage Business

French dairy giant Danone has signaled its intention to re-enter the Indian dairy market. Following previous retreat from dairy sales in the country in 2018, the company is now planning a robust investment strategy, including a three-year initiative to collaborate with local farmers in Punjab.

Danone aims to support over 5,000 smallholder dairy farmers in Punjab by introducing sustainable farming practices and enhancing their knowledge of resilient agricultural models. This initiative is projected to lead to increased milk production, higher farmer incomes, and improved welfare for cattle.

Previously known for brands like Actimel and Activia, Danone exited the dairy sector in India to concentrate on nutrition products such as Protinex and Aptamil. The company’s remaining operations at that time accounted for over 90% of its sales in India, highlighting its strong market presence in those segments.

During a recent visit to India, CEO Antoine de Saint-Affrique shared insights with the business news outlet Mint, indicating that consumers can expect to see more of Danone’s products on shelves soon. He remarked on the competitive landscape, stating, “Competitors in India are so strong that I’m not going to announce in advance what we are going to do.”

When asked about potential missed opportunities in the growing dairy market, he noted, “the past is the past,” emphasizing the importance of future growth. He highlighted India’s burgeoning middle class and population growth, stating, “What I’m interested in is the future… you see the relevance of our products in these markets.”

The dairy farmer initiative will be executed in collaboration with the BAIF Development Research Foundation, a non-governmental organization focused on agricultural development. De Saint-Affrique expressed Danone’s belief in shared success with farmer partners, saying, “Danone is committed to building inclusive growth for all our farming partners.”

Since launching its nutrition business in India in 2012 by acquiring the Wockhardt Group’s nutrition division, Danone has established its country headquarters in Mumbai, employing over 1,000 individuals across the nation. The company operates a specialized nutrition facility in Lalru, Punjab, which employs more than 300 people; it announced plans for a €20 million ($22.4 million) investment in this facility.

In summary, Danone is poised for a strategic comeback in the Indian dairy sector, aiming to foster sustainable practices among local farmers while enhancing its product offerings in response to the evolving food and beverage industry trends. The company’s efforts align with growing demands and consumer trends in the food and drink business.

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