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Swiss FMCG major Nestle today said it expects emerging markets, including India and China, to account for 50 per cent of its global sales by the end of the ongoing decade.
“Globally emerging markets, I believe, contribute about 40 per cent of Nestle’s business at this point of time for this first six months of the year and expectation is that by the end of the decade it should reach 50 per cent,” Nandu Nandkishore, SA Zone Director (Asia, Oceania, Africa and Middle East), Nestle said.
Bullish on the long-term potential of India, he said the company will be opening a global research and development centre in Haryana.
“We have recently announced and implemented capital expansion programmes in India. We will be announcing on Thursday the opening and inauguration of a new R&D centre for Nestle global, which is set up at Manesar. It is just an indication of our faith and expectation,” Kishore said.
Considering that China and India were expected to be among the top three economies in the world by the end of the decade, he said there were high expectations.
“It is inevitable that one of the prime expectations from China and India is to deliver growth, which lives up to the economic potential that both these markets have going forward into the future. So, India is a very much a market which are looking for growth and it remains an important market for us,” Kishore said.
In 2011, Nestle had a global turnover of 85 billion Swiss francs, out of which India contributed 1.5 billion Swiss francs, which is less than 2 per cent.
He said while in developed markets such as Europe and America, the driver of growth is mainly through innovation.
“In emerging markets, whether it be China, India or the Middle East or Africa the driver of growth is GDP and growing access to income,” Kishore said, adding as people moved to cities, there would be increase in demand for processed food products.
“So the expectation is growth from all these markets and it is not one market against the other. All markets will grow,” Kishore said.
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