Atlanta-based Coca-Cola Co.’s ongoing efforts to broaden its beverage portfolio beyond carbonated drinks could provide a boost for India’s fruit growers.
To underpin Minute Maid Pulpy Mosambi, a recently launched brand named for the citrus fruit also known as sweet lime, the beverage giant’s India arm is investing $1.7 billion to create a “circular economy” for growing, harvesting and processing the fruit within India.
This “grove-to-glass” move, as the company calls it, aims to help India achieve a national goal of doubling farmer incomes by 2022 and should boost the country’s overall agricultural efficiency, Coke India said in a news release.
“We have already expanded our Minute Maid juice range from 1 variant in 2007 to 11 variants in 2017 and if we are to realize our portfolio ambitions of being a Total Beverage Company, we must invest in the agri ecosystem,” T Krishnakumar, President, Coca-Cola India and Southwest Asia, said in the news release.
A little less than half of the investment, about $800 million, will go toward sourcing mosambi fruit from Indian farmers. The remaining $900 million will be spent on processing equipment, bottling lines and “agricultural interventions.” The latter investment comes from Coke-owned bottler Hindustan Coca-Cola Beverages and 13 independent bottlers.
India often touts the strength of its agricultural sector as a strength, and indeed it does export certain pulses and grains. But land titling rules have made it hard for large, industrialized farms to take root, and lackluster logistics infrastructure has made transporting food to markets a challenge, especially with refrigerated goods.
Coke’s announcement comes just after the company said it would shed 1,200 jobs in Atlanta to cut costs. New CEO James Quincey is aiming to double down on the company’s efforts to appeal to health-conscious consumers as it battles negative perceptions associated with sugary drinks and artificial sweeteners in its zero-calorie offerings.
Coke, which has been protested in India over water use and other issues, says it sources about 95 percent of its ingredients in India locally and has exported some $280 million in agricultural products to 44 countries from India.
The new initiative is one of many aimed at the Indian ag sector. Through Project Unnati, Coke underwrites buses that act as mobile classrooms that head to the countryside to teach mango farmers adopt new irrigation methods to boost their yields, which among the lowest in the world per hectare. The project is expected to touch 25,000 farmers.
That could help the company make inroads among government officials. Last year, Project Unnati brought about an agreement with the governor of the western Indian state of Maharashtra, home to the city of Mumbai. Among many other techniques, the process employs drip irrigation, a technology pioneered in Israel.
Speaking in Atlanta on the technology and its deployment through a partnership program in India, a representative from Israel’s Consulate General in New York noted that the one language Indian officials from all political persuasions understand is agriculture.
