New Delhi, India's food services sector is estimated to grow by 8.1 per cent to reach a size of Rs 7.76 lakh crore by FY28 from Rs 5.69 lakh crore in FY24, the National Restaurant Association of India said Tuesday.
In its India Foodservice Report 2024, the National Restaurant Association of India (NRAI) said the organized segment of the foodservice sector is projected to grow at a CAGR of 13.2 per cent for the year prosecutor 28.
The sector has recovered from the setback of the COVID-19 pandemic during which it shrank to Rs 2 lakh crore in FY21, down from Rs 4.24 lakh crore in FY20. In FY22, it recovered to reach Rs 4.72 lakh crore, Rs 5.3 lakh crore in FY23 and increased to Rs 5.69 lakh crore in FY24.
According to the report, in FY25, the size of the sector is estimated to reach Rs 6.13 lakh crore. India will become the third largest food services market by 2028, surpassing Japan. The United States remains the world's largest market.
"Despite setbacks during the COVID-19 pandemic, the food services industry in India is experiencing rapid growth... The post-COVID recovery highlights the resilience of the industry," said the president of NRAI, Kabir Suri.
He called on the government to “recognize the socio-economic impact” of the sector and take immediate steps to unlock its full potential.
NRAI said the sector is the second largest employer, with employment of 85.5 lakh in FY24 and expected to rise to 1.03 crore in FY28.
The fiscal contribution of the sector is projected to reach Rs 55,594 crore by 2028, up from Rs 33,809 crore in 2024.
The share of the organized segment of the food services sector is estimated to reach 52.9 per cent of the total by FY28 from 43.8 per cent in FY24, while that of the unorganized segment fall to 47.1 percent by FY28 from 56.2 percent. in FY24, according to the report.
NRAI Report Steering Committee Chairman Nitin Saluja highlighted the need to have a separate ministry for food services, which can better understand the challenges of the sector, saying it would enable an agenda for faster growth of the industry.
He also reiterated the long-pending demand for an "industrial status" of the sector as it would encourage entrepreneurship and entrepreneurship.
Saluja also said that the two options of block GST at 12 per cent with input tax credit (ITC) and the current 5 per cent without ITC should be made available to all restaurants, adding that the availability of ITC will allow Restaurants pass on benefits to customers.
Stating that the sector is highly regulated, he also called for a simplified and standardized licensing and permit policy across the country.
Furthermore, he also said that restaurants should be allowed to operate for longer hours, even 24 hours a day in cities where nightlife is vibrant to grow businesses and create more employment opportunities.
In its India Foodservice Report 2024, the National Restaurant Association of India (NRAI) said the organized segment of the foodservice sector is projected to grow at a CAGR of 13.2 per cent for the year prosecutor 28.
The sector has recovered from the setback of the COVID-19 pandemic during which it shrank to Rs 2 lakh crore in FY21, down from Rs 4.24 lakh crore in FY20. In FY22, it recovered to reach Rs 4.72 lakh crore, Rs 5.3 lakh crore in FY23 and increased to Rs 5.69 lakh crore in FY24.
According to the report, in FY25, the size of the sector is estimated to reach Rs 6.13 lakh crore. India will become the third largest food services market by 2028, surpassing Japan. The United States remains the world's largest market.
"Despite setbacks during the COVID-19 pandemic, the food services industry in India is experiencing rapid growth... The post-COVID recovery highlights the resilience of the industry," said the president of NRAI, Kabir Suri.
He called on the government to “recognize the socio-economic impact” of the sector and take immediate steps to unlock its full potential.
NRAI said the sector is the second largest employer, with employment of 85.5 lakh in FY24 and expected to rise to 1.03 crore in FY28.
The fiscal contribution of the sector is projected to reach Rs 55,594 crore by 2028, up from Rs 33,809 crore in 2024.
The share of the organized segment of the food services sector is estimated to reach 52.9 per cent of the total by FY28 from 43.8 per cent in FY24, while that of the unorganized segment fall to 47.1 percent by FY28 from 56.2 percent. in FY24, according to the report.
NRAI Report Steering Committee Chairman Nitin Saluja highlighted the need to have a separate ministry for food services, which can better understand the challenges of the sector, saying it would enable an agenda for faster growth of the industry.
He also reiterated the long-pending demand for an "industrial status" of the sector as it would encourage entrepreneurship and entrepreneurship.
Saluja also said that the two options of block GST at 12 per cent with input tax credit (ITC) and the current 5 per cent without ITC should be made available to all restaurants, adding that the availability of ITC will allow Restaurants pass on benefits to customers.
Stating that the sector is highly regulated, he also called for a simplified and standardized licensing and permit policy across the country.
Furthermore, he also said that restaurants should be allowed to operate for longer hours, even 24 hours a day in cities where nightlife is vibrant to grow businesses and create more employment opportunities.
