India’s Coffee Export Surge: Shipments Increase Significantly to $1.8 Billion
India’s coffee exports have experienced remarkable growth, surging by 125% over the past 11 years to reach $1.8 billion in the 2023-24 fiscal year, up from $800 million in 2014-15. This significant increase is attributed to various policy measures implemented by the Coffee Board of India, including the digitalization of permits and export incentives. With Europe being the primary market for Indian coffee, the sector continues to expand, supported by government initiatives aimed at enhancing export capabilities.
Export Growth and Market Dynamics
According to recent data from the central government, coffee exports from India reached $1.28 billion in 2023-24, a rise from $1.14 billion in the previous fiscal year. Europe remains the leading destination for Indian coffee, with Italy, Germany, Belgium, and several Middle Eastern nations among the key markets. The Coffee Board of India has introduced several measures to facilitate this growth, including the digital issuance of Registration-Cum-Membership Certificates (RCMC), export permits, and certificates of origin. Regular engagement with exporters helps address any bottlenecks in the supply chain, while the provision of global market intelligence further supports exporters in navigating international markets.
To enhance the competitiveness of Indian coffee in the global market, the government has also introduced transit and freight assistance. This includes financial support of Rs 3 per kilogram for value-added exports and Rs 2 per kilogram for high-value green coffee shipments to distant markets such as the United States, Canada, Japan, and Nordic countries. These initiatives aim to reduce logistical challenges and make Indian coffee more appealing to international buyers.
Support for Domestic Producers
The Coffee Board is also committed to supporting domestic processors and entrepreneurs. It offers a substantial subsidy of 40% on machinery costs for roasting, grinding, and packaging units, with a cap of Rs 15 lakh. This financial assistance is designed to encourage local businesses to enhance their processing capabilities and improve the quality of their products. Divya Shree G S, founder of Vidi’s Coffee, emphasized that these measures are instrumental in helping Indian coffee reach new markets.
M. Kurma Rao, CEO and Secretary of the Coffee Board, highlighted the sustainable practices associated with Indian coffee production. Much of the coffee is shade-grown under native canopy trees, which not only promotes biodiversity but also aids in soil and water conservation. This environmentally friendly approach provides a sustainable income for small and marginal growers, aligning with global sustainability standards.
Global Opportunities and Future Prospects
The potential for Indian coffee exports is vast, as noted by the founders of South India Coffee Company (SICC), Akshay Dashrath and Komal Sable. They believe there is significant room for growth in the specialty coffee segment. With India being the seventh-largest coffee producer globally, holding a 3.5% share of production, and ranking fifth in exports with a 5% global share, the country is well-positioned to capitalize on international demand.
India produces approximately 3.6 lakh tonnes of coffee annually, with Karnataka, Kerala, and Tamil Nadu being the primary growing regions. The coffee sector plays a crucial role in the economy, directly and indirectly supporting around 2 million people. As the global market for coffee continues to evolve, Indian producers are optimistic about expanding their footprint and enhancing their offerings to meet diverse consumer preferences worldwide.
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