Competitive strategy for sustainable growth of the Indian sugar industry

Abstract

India is the world’s second largest sugar producer but the biggest consumer. It has many characteristic features such as PDS obligation, government controls on input and output side, existence of the “Sugar cycle”. The paper discusses on the research question if the Indian Sugar Industry is competitive in the global market and then what are the ways through which it’s competitiveness can be enhanced.

The study is based on DRCR analysis using Policy Analysis Matrix (PAM). It incorporates a large number of policy parameters covering the large number of by products that this industry leads to. This gives an insight into strategic decision which a sugar firm can consider to make sugar competitive and also be on a path of sustainable growth.

The present work is based on primary research and data collection from Shree Tatyasaheb Kore Co-operative Sugar Factory Limited, Warananagar, Kolhapur, Maharashtra. Through the visits and interviews at the factory the study brings out the strengths of the model at Warana and what they are doing to be on a growth trajectory.

The important conclusions of the study are that by-products can add to the competitiveness of the industry if diversified, high value addition uses are found towards its usage. By looking at the complete value chain an industry can find avenues to add value. Also on the co-operative model the Warana example shows how producers and consumers can converge together to create a socially and economically viable business.

The important policy implications that stem out from this study are that the government should create conducive policies to facilitate setting up of by-product utilization units along with the parent concern. This will enable them to look out for ways to increase their own overall efficiency by diversifying in new technologies and product portfolios.