Will India's Coffee Industry Reach $3.2 Billion by 2028?
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Synopsis
India's coffee industry is on track for significant growth, with projections indicating a compound annual growth rate of 8.9% by 2028. Specialty coffees are enhancing the country's global standing as a key player in the coffee market, creating sustainable livelihoods, and expanding export opportunities.
Key Takeaways
- Projected growth of 8.9% in India's coffee sector by 2028.
- Out-of-home coffee segment expected to reach $2.6 billion - $3.2 billion.
- Current annual production stands at 3.6 lakh tonnes.
- 70% of coffee produced in India is exported.
- Reduction in GST is likely to enhance domestic consumption and profitability.
New Delhi, Nov 29 (NationPress) The coffee sector in India is set for a remarkable growth trajectory, expected to achieve a compound annual growth rate of 8.9% by 2028. The out-of-home coffee segment is projected to witness even more significant growth, with a CAGR of 15 to 20%, potentially hitting between $2.6 billion and $3.2 billion by 2028, according to an official announcement made on Saturday.
The Coffee Board of India has set an ambitious goal to elevate national production to 9 lakh tonnes by 2047, positioning India as a formidable global coffee producer.
Currently, the nation produces around 3.6 lakh tonnes of coffee each year, with approximately 70% of it being exported to 128 countries, the statement added.
The rise of specialty coffees, including Monsooned Malabar, Mysore Nuggets, and Koraput Coffee, has bolstered India's status as a producer of premium and competitive coffee varieties globally.
Successful tribal cooperatives, such as the Tribal Development Co-operative Corporation of Odisha Ltd (TDCCOL), have demonstrated how coffee can serve as a tool for socio-economic empowerment and sustainable livelihood development, as highlighted by the government.
With smallholder farmers dominating the sector, holding nearly 99% of the total land and contributing 70% to the country's coffee production, coffee cultivation remains a crucial component of India’s rural economy.
Recent reductions in GST rates and trade agreements, including the India–UK Comprehensive Economic and Trade Agreement (CETA), have opened new avenues for value-added coffee exports.
In the last four years, coffee exports have consistently surpassed $1 billion, reaching a landmark $1.8 billion in FY25, marking a 40% increase from $1.29 billion the previous year.
Despite facing global geopolitical challenges, exports from April to September 2025 totaled $1.07 billion, reflecting a 15.5% growth compared to the same timeframe in 2024.
The government's decision to reduce GST on coffee extracts from 18% to 5% is anticipated to lower retail prices by 11–12%, stimulate domestic consumption, and improve profitability for small processors, the statement concluded.
Point of View
I believe that the growth of India's coffee industry not only highlights our agricultural potential but also serves as a beacon of hope for rural economies. The government's initiatives and the rise of smallholder farmers reflect a promising future in creating sustainable livelihoods.
NationPress
29/11/2025
Frequently Asked Questions
What is the projected growth rate of India's coffee industry?
India's coffee industry is projected to grow at a compound annual growth rate of 8.9% by 2028.
What segment of the coffee industry is expected to grow the fastest?
The out-of-home coffee segment is expected to grow at a CAGR of 15 to 20%, potentially reaching $2.6 billion to $3.2 billion by 2028.
How much coffee does India currently produce?
India currently produces about 3.6 lakh tonnes of coffee annually.
What percentage of Indian coffee is exported?
Nearly 70% of India's coffee production is exported to 128 countries.
What impact do tribal cooperatives have on coffee production?
Tribal cooperatives like TDCCOL in Odisha exemplify how coffee can empower communities and promote sustainable livelihoods.
