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India at advantageous position on inflation, less touched than other markets, says Nestle global CEO

India is less touched than many other large markets because of the strong ”groundswell of economic growth that we are seeing”, Schneider said at a select media roundtable here.

September 23, 2022 / 06:44 PM IST

Globally, there are concerns on inflation, which at some point has a dampening effect on demand, but the Indian market is in a very advantageous position on this front, Nestle’s global CEO Mark Schneider said.


India is less touched than many other large markets because of the strong ”groundswell of economic growth that we are seeing”, Schneider said at a select media roundtable here.


”I think India is in a very advantageous position in the sense that of course, there are inflation concerns, no question. But you see such a strong underlying volume demand from a rising middle class and people reaching higher levels of income,” he said, adding it ”overpowers some of the concerns that may come from inflation.”


Nestle’s CEO on Friday announced plans to invest Rs 5,000 crore in India by 2025 and said manufacturing skills are in progress in the country. According to Schneider, India’s ”bounce back from that situation (COVID-19) is impressive” and that could not have been done without significant progress on vaccination in the country. ”I think India has done wonders on this,” Schneider said.


Replying to a question on disruptions, Schneider said after the pandemic and the Russia-Ukraine war, there are challenges regarding inflation and global supply chains, particularly in the food and beverage space.

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In the global markets, now there is more focus on local supply chains and fortunately in India, 99 per cent of what Nestle sells is locally manufactured, he said. ”But in some other parts of the world, we are just trying to step by step regroup, and make sure that the supply chains get less vulnerable,” he added.


Schneider added that Nestle was not hit hard by supply chain restrictions and was impacted only temporarily. Some key agricultural products coming from Ukraine, like wheat and sunflower oil, were impacted and the company accepted the higher prices.


”But we also had a chance to sometimes tweak our recipes and actually switch to a different oil source and that way mitigate the impact. So to me, the major, major existential impacts did not happen,” he added. Overall, Nestle is committed to responsible pricing and keeping products affordable for all strata of society, he added.


Speaking on Nestle’s journey towards healthier lineups, Schneider said for the last several years, it is consistently revamping its portfolio in that direction. ”We have been buying, especially into the vitamins, minerals and supplements space as an example,” he said.

However, for the Indian market, Nestle’s journey in health sciences has just started and there is a huge opportunity, Nestle India CMD Suresh Narayanan. He added that ”nothing would be accomplished in six months to a year. I think… this can be a really exciting platform for the future. It is one of the pillars that we will look at is the health science with the current complement of products, acquisitions or capabilities.”

PTI
first published: Sep 23, 2022 06:44 pm
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