India’s Growing Economy Leads to Healthy Market for Paint and Coatings

By Cynthia Challener

With per capita paint consumption currently at one of the lowest levels in the world, India presents the coatings industry with a vast market poten­tial. Both domestic and international paint manufacturers hope to leverage that potential into real sales value as consumers in the country become more able and willing to buy their products.

The Indian market differs in a number of ways, though, from markets in other emerging regions as well as developed countries. New entrants will need to be aware of these unique characteristics.

Estimates for the value of the Indian coatings market differ depending on the source. Market research firms put the total value of sales at $2.4-$2. 7 billion dollars, while domestic paint manufacturers believe the figure to be as much as $3.2-$3.5 billion. Volume consumption is estimated to be around 900,000 to 1,000,000 tonnes per year.

Most agree that the market has been growing at about 15% per year in both value and volume terms and that a rate of 12-15% should be main­tainable for the foreseeable future. In general, sales of coatings increase at a rate approximately 1.5-2 times that of the overall growth rate for the Indian economy.

In developed countries, and even in China where tremendous industrial­ization has occurred, the market is typically divided evenly between indus­trial and architectural coatings. In India, however, significant levels of indus­trialization only began to take place in the past five years or so. As a result, the country has one of the highest percentages of decorative paint use in the world, according to Dr. Terry Knowles, business manager at IRL, a division of Business Research Group (UK) Ltd. Architectural coatings, in fact, account for 70-80% of the total market.