Despite FMCG companies’ efforts to cut sugar content in packaged foods and beverages, India’s institutional sugar consumption has surged by 10% over the last five years, according to a study by the Indian Sugar and Bioenergy Manufacturers Association (ISMA).
Institutional consumption—which includes sugar use in non-alcoholic beverages, confectionery, bakery, biscuits, dairy, ice cream, hotels, restaurants, pharma, and other processed foods—rose from 50–55% of total sugar demand in 2018-19 to 60–65% in 2023-24. Retail consumption now accounts for the remaining 35–40%.
Within institutional consumption, non-alcoholic beverages account for the largest share, at 35–40%, followed by confectionery, at 15–18%. The study drew inputs from major FMCG players, including Nestlé, Britannia, Mondelez, Parle, Coca-Cola, and Amul.
The report highlights a diverging consumption pattern. Mid-income urban families and rural consumers are driving demand for sugar-rich packaged products, often viewed as aspirational, while affluent households are increasingly switching to low-sugar and functional alternatives.
ISMA noted that India’s 70 million mid-income households continue to show strong preference for refined sugar in daily use, alongside stable consumption of gur and khandsari. Meanwhile, the 30 million affluent households are cutting down on processed sugar, opting instead for traditional sweeteners and healthier substitutes.
By 2030, institutional sugar demand is expected to rise further, with mid-income consumers fueling growth in sugar-laden processed foods, even as affluent India pivots toward low-sugar and wellness-oriented diets.