The Emerging Global Halal Market - India's Enormous Untapped Potential

Halal, translated into Chinese as 'qingzhen,' refers to food, pharmaceuticals, cosmetics and food/pharmaceutical/cosmetic additives that conform to Muslim living habits and needs. It applies to all areas of living activities, including grains, cloth, finance, personal care products, etc. Halal products exclude pork and alcohol. A Halal market is emerging globally.

The Halal Market Becomes Fashionable

Shafeeq Rahman says that purely Halal Muslim products are a large part of the Indian economy.

Emerging markets are rising globally, especially developing in Europe and Southeast Asian countries: Halal services and Halal products that comply with Islamic law's Halal dietary regulations and other norms most strictly followed by some Muslims. The Halal market has expanded from Halal food to new areas such as Halal cosmetics, Halal food logistics, Halal food fashion and travel services. Islamic finance, a relatively mature interest-free market, serves a large number of Muslim consumers, with total assets of Sharia-compliant products worldwide estimated at around US$95.1 billion at the end of 2008, up 25% from US$75.8 billion in 2007, while in the mid-1990s it was only about US$15 billion.

Muslims make up more than 10% of the world's population, and it is estimated that 0.8% will live in India by 2030. India is home to more than 17.5 million Muslims, ranking third in the world's Halal consumer market after Indonesia and Pakistan. But Halal-approved products among mainstream brands still remain largely untapped. According to estimates by the Pew Research Group, India's Muslim population is expected to increase from 177.3 million in 2010 to 236.2 million in 2030. And the proportion of Muslims in India's population is expected to increase from 14.6% in 2010 to 15.9% in 2030. The enormous potential of the Halal market remains to be tapped.

Most Muslims prefer to buy only Halal-certified products. In addition, in recent years Muslim consumers have heightened their awareness of religious obligations, which expands the demand for Halal food items. By population, Muslims account for a 15% market share of India's consumer market, but constrained by their economic conditions, it is estimated that Muslim consumers account for only 10% of India's overall private consumption expenditure.

Halal Certification Attracts Muslim Consumers

In addition to the domestic market, India is a major hub for exporting meat and processed products to Muslim countries. Malaysia, Egypt, Saudi Arabia, Kuwait, the UAE, Jordan and Oman are among the top ten destinations for India's meat imports, and the UAE was the main destination for India's processed food in 2009-2010. Products labeled as Halal food will attract Muslim consumers in overseas markets, especially the Middle East and Arab regions, which are India's major trading partners.

India's Halal Market

Al Kabeer, Allanasons, Alhind and Vinkeys are the major players in India's Halal meat processing, with a wide variety of products under their brands. Currently in India, there are no very serious investors and promoters of Halal-approved products.

Besides the Halal food market, 'Islamic finance' is another controversial hot topic concerning India's Halal economic services. Because Islam prohibits interest-based transactions, Indian Muslims are reluctant to participate in banking and economic activities. The Bombay Stock Exchange has launched its Sharia-compliant companies, intending to increase investment from Indian Muslims. The Kerala state government introduced Sharia-compliant company options among mainstream financial institutions. Some private brokerage firms also offer Sharia-compliant investment portfolios in India. May relevant Chinese businesses pay more attention to the Halal market and seize the opportunities.