PepsiCo to double potato procurement in India in 5 yrs

Dec 05 2012, 21:29 IST
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PepsiCo today said it is looking to double procurement of potato in India annually over the next five years from the current 2.4 lakh tonnes, a day after BJP leader Sushma Swaraj stated that the food and beverages major rejected local produce in Punjab. (Reuters) PepsiCo today said it is looking to double procurement of potato in India annually over the next five years from the current 2.4 lakh tonnes, a day after BJP leader Sushma Swaraj stated that the food and beverages major rejected local produce in Punjab. (Reuters)
SummaryPepsiCo today said it is looking to double procurement of potato in India annually over the next five years from the current 2.4 lakh tonnes, a day after BJP leader Sushma Swaraj stated that the food and beverages major rejected local produce in Punjab.

PepsiCo today said it is looking to double procurement of potato in India annually over the next five years from the current 2.4 lakh tonnes, a day after BJP leader Sushma Swaraj stated that the food and beverages major rejected local produce in Punjab.

"We work with around 24,000 farmers right now and last year we procured about 2.4 lakh tonnes of potatoes through contract farming and the programme continues to expand. I think, over the next five years, this figure should double," PepsiCo India Executive Director Vivek Bharati told reporters here.

The company is at present engaged in contract farming in seven states, including West Bangal, Punjab and Karnataka.

During the debate on FDI in retail in Parliament yesterday, Swaraj had said that the most likely scenario would be that retail chains would not buy products from small and medium farmers at all and supported her contention by giving the example of PepsiCo in Punjab that rejected locally produced potatoes and tomatoes as being below standards.

Asked for his comments on FDI in retail, PepsiCo India Chairman Manu Anand said: "FDI is being debated in the Parliament, we do not want to get into this debate. As far as our sector is concerned, it is 100 per cent FDI (sector). Well, the more the points of sale, the better it is always for the industry."

Talking about its various initiatives for local people, he said the company has launched a community partnership initiative here, which will help conserve 400 million litres of water every year and help 7,500 people. The beverages plant here is the company's biggest unit in India.

"We have improved the water efficiency at our Sangareddy plant from 2.65 litres of water per litre of finished beverage in 2007 to 1.88 litres in 2011, thereby saving 564 million litres of water," he said, adding the company has invested Rs 500 crore on this plant since 2006.

Under the project, the company encourages people in rain water harvesting and to form self-help groups.

Talking about the Indian market, Anand said: "In the last four years, we have invested about a billion dollars and will continue to enhance that investment appropriately as the situation demands. It's a priority market for PepsiCo."

Without sharing details, he said India is among the top five markets for the company globally.

"Important to notice today is that we have eight brands with sales over Rs 1,000 crore each and that continues to increase and go up every year," Anand said.

The eight brands are Pepsi, 7UP, Mirinda, Slice, Mountain Dew, Lays, Kurkure and Aquafina.

Expressing optimism on continuing good growth, Anand said the per capita consumption of both carbonated drinks and snacks is low in India compared to other emerging markets.

"In India, the per capita carbonated drinks consumption is even half than Pakistan. So these categories continue to grow in double digit on sustained quarter-on-quarter basis and we are really thrilled to participate in this growth," he said, adding the company will continue to add new products and has already introduced about 25 products this year.

The company sells its beverages through about 1.5 million outlets, while it is available in over 2 million outlets for its food business.

When asked about the company's strategy to become the title sponsor of IPL, Anand said: "The viewership of IPL is going up every year. In fact, it is something which brings about a huge amount of passion for the Indian audience in the month of April and May, viewership of IPL is just phenomenal.

"Partnership between IPL and Pepsi is just fantastic partnership... I think we will add a lot to IPL and IPL will add a lot to Pepsi. We believe IPL is a great investment for us, it's a great property to partner with."

Last month, PepsiCo became the new title sponsors of the cash-rich Indian Premier League after it won the bid for title rights for five years by paying a whopping Rs 396 crore.

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