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BEVERAGE

Current Scenario of Water Bottling Companies in India
Wednesday, 11 December, 2019, 16 : 00 PM [IST]
Dr Anurag Singh and K Sai Shiva
Drinking water is becoming one of the major issues in India, hence bottled water industry has been growing like never before in the last few decades. The concept of bottled water came into existence in the early 1900s in Western countries and mid of 1970s in India.

Initially bottled water was felt to be a rich people’s choice later on due to increasing health concerns, unavailability of clean drinking water led to increase in the demand for bottled water. Bottled water is sold in different quantities such as 200-250 ml in pouches, 500 ml, 1L, 2L in bottles, 20-50 litre in barrels and so on.

At present, people spend large part of their time outside homes and do not prefer to drink the outside water due to safety issue. So either they prefer to carry water bottle or purchase bottled water as it is available everywhere at affordable price. Customers prefer to purchase 20L bulk packages of water for home use, functions, small hotels and restaurants rather than installing water purifiers.

Global scenario of bottled water market

The global bottled water market is mushrooming due to increased awareness on importance of safe drinking water for maintaining good health. The market is driven by certain diseases like fluorosis, malaria, typhoid, diarrhoea and viral fever. Even the taste offered by the bottled water is playing a major role in the increasing demand in the market.

As per a report published by a business research company, the global bottled water market was estimated at $250 billion in 2018 and expected to reach $350 billion by 2021. Some of the key players in the market are Nestle, Hangzhou Wahaha Group Co. Ltd, Danone, Coca-Cola and PepsiCo, and the maximum sale of water bottle comes from the retail sector.

Indian scenario of bottled water market
In India, the demand for bottled water is majorly due to unavailability of safe drinking water because of enormous increase in the population, inflow of foreign students and tourists, poor quality of tap water and ease of availability of bottled water and rise of health awareness. As the government has failed to provide clean drinking water at all places, private players have not just filled the gap but also created a robust business. The best mineral water companies in India are focussing on augmenting their market shares by implementing effective marketing strategies and attractive packaging. The market has reached Rs~160 billion in 2018 and it is expected to grow annually by CAGR of 20.75% and reach Rs ~403.06 billion by 2023. The bottle of 1L captured 42% of market share in 2018 followed by 500 ml bottles and 250 ml bottles. Based on volume, the market is likely to reach ~35.53 billion litre by 2023, expanding at a CAGR of ~18.25% from 2018 to 2023.

Flavoured bottled drinking water has become popular in India recently. Different kinds of flavoured water containing fruit essence and artificial sweeteners like soda, cola, juice, and other sweetened beverages often act as a substitute to plain bottled water. Consumers prefer flavoured bottled water to normal bottled water sometimes. This shift is developing an opportunity to expand the product line of bottled water manufacturers in India.

Bottling units and popular brands in India

There are more than 6,000 licensed water bottling setups under BIS (Bureau of Indian Standards) and uncountable unorganised mineral water companies in India. There are around 150 domestic Indian bottled water brands in the market today. The key brands in India are Bisleri, Kinley, Bailey, Aquafina, Himalayan, Rail Neer, Oxyrich, Vedica and Tata Water Plus. Consumption of bottled water in India is linked to the level of prosperity in the different regions. The western region accounts for 40 per cent of the market and the eastern region just 10. However, the bottling plants are concentrated in the southern part of the country. More than 55% of the total bottling plants are in four southern states.

Regulations for bottled water industry
The packaged water industry in the country is regulated and all bottling units have to obtain BIS certification as well as FSSAI licence before they can operate. However illegal manufacturing units do thrive across the country, putting at great risk the health of the people. Indian bottled water is governed under two categories: 1. Packaged Natural Mineral Water [Under IS: 13428:1998, Amendment 1-5 upto October 15, 2004] 2. Packaged drinking water [Under IS: 14543: 2004].

Challenges for companies and regulators
The biggest challenge faced by the bottled water companies in India is the duplicacy especially in case of 1 L bottle. It is very easy to create a fake bottled water compared to any other product. Indian consumers tend to believe that any bottled water is safe but this may not be true in case of fake product. Even such type of fake products were produced by filling water in the used pet water bottle and are sold only in few places where public travels most like railway stations, bus stations and metro stations. The bottle used to fill such type of products are collected in the dustbins, roadsides and dumpyards.

The other major challenges are from the unorganised sector which is leading in the production of bottled water in rural, semi-urban and few urban areas. As the production does not require big machinery it made counterfeiters to produce bottled water in different regions with single licence and without licence. Quality and safety are the biggest challenges in this unorganised sector. Food safety departments lifted 1,123 samples across the country in 2017-18. Of these, 496 samples failed to meet the quality standards prescribed by the country’s apex food regulator FSSAI.

Actions taken against unbranded/ non-licensed units
As per FSSAI, as many as 75 per cent of the packaging units, owned by various firms, are said to be operating without an FSSAI licence. These units are operating under a BIS certification only. Whereas both are required to run the business. BIS and FSSAI keep monitoring the non-licensed water bottling units in the country through enforcement agencies and whenever it is found so, necessary action is taken. There are many incidences of such action. Some of the recent incidences are as follows:

The Food and Drugs Administration (FDA) sealed four units for running their business without a BIS certification in Aurangabad in April 2015 whereas a team of officials of BIS, Southern Regional Office (SRO) Chennai conducted enforcement search and seizure operation in July 2016 at Chennai and Kancheepuram districts on information of suspected misuse of ISI Mark. Jars of 20L from the unit of Aquaver Minerals having the brand name “Classic” and 1L pet bottles from A Ve Aqua Farms with brand name “Aqua Rich” were seized and the units were penalised.

In January 2018, a team of officials and police, led by district food inspector sealed the Birag Beverage unit in Bhawanipatna, Odisha, after finding that it was being run illegally without the required permissions. In March 2018, BIS raided a packaged drinking water manufacturing unit - Shiva Ganga mineral water plant in Ranga Reddy district as it was using a fake licence number for the ‘ISI’ mark. A large number of 20 litre pet bottles filled with packaged drinking water with the fake licence number and brand name ‘Fosters’ with spurious BIS mark were seized during the raid.

In August 2018, BIS conducted an enforcement raid on Hi-Tech Aqua, in Mayapuri Industrial Area, Delhi. The firm was manufacturing packaged drinking water packed in 20L capacity filled jars under brand “Freshier” with spurious licence. A substantial quantity of empty 20L capacity jars with brand “Parie” and brand “Bisleri” with spurious licence no. were also found in aforesaid premises. A huge quantity of above mentioned jars were seized.

Similarly in Pune, the BIS took action against three packaged drinking water manufacturing units for illegal use of ‘ISI’ standard mark. Sanidhya Food and Beverages, Khed; Shilpa Beverages Pvt. Ltd at Nanded Phata and Amol Packaged Drinking Water, Kedgaon (Daund), were found manufacturing packaged drinking water without having valid licence. Consequently, action was taken against them and a large quantity of 20 litre jars, 1 litre bottles and 500 ml bottles with spurious BIS mark were seized during the raids.

Recently in January 2019, BIS conducted raid on ‘Aqua Spring Enterprises’ located at Mayur Marg in Begumpet, Hyderabad, for packing and selling packaged drinking water in 20-litre pet jars without a valid BIS licence whereas in June, 2019, ‘Niyati Beverages’ was sealed in Rajkot by the enforcement agencies as quality of groundwater used for packaging was not as per standards and the unit was violating all rules of BIS and FSSAI by illegally embossing BIS logo and fake food licence details.

Conclusion
Water bottling companies are booming the market although they received several obstacles from the unorganised sector and availability of one-time investment water purifiers. A huge profit in the market is due to demand raised by the increase in the population and taste of the water. Although several raids are made by BIS and FSSAI but the unorganised sector is rising because of low investment in the production and indiscriminate disposal of used water bottles. So it is the responsibility of the government and every citizen to eradicate unorganised sector and producers not following the required to ensure safe bottled drinking water.

(Dr Singh is assistant professor, Food Science and Technology Department, and Shiva is MTech student, NIFTEM, Sonipat. They can be contacted at anurag.niftem@gmail.com)


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