The Indian Sugar Industry – Is it Sweet Enough?

1. Assess the attractiveness of the Indian sugar industry using Porter’s five forces model.
Discuss the impact of the following factors on its attractiveness:

a) Relative bargaining power differences between farmers and sugar producers;

b) Government regulations; and

c) Global sugar producers.

2. What are the critical success factors of Indian sugar industry?

3. Discuss whether the following possibilities could improve the attractiveness of Indian sugar
industry:

a) Changes in the industry forces within a foreseeable period of time;

b) Deregulation; and

c) Focus on by-products such as ethanol.

4. Compare the characteristics of Brazilian and Indian sugar industries and discuss whether
there is a possibility of convergence of these two industries in terms of their structural
characteristics.
Critical success factors (critical performance indicators)

1) Capital utilization
2) India’s tropical position provides the ideal climatic condition for the sugar cane production, hence
leading to the good quality raw material sugar production.
3) Horizontal growth of Indian sugar industry has focused upon with large number of small-seized
sugar plants established across the country, as compared to the capacity consolidation to the other
sugar producing industries to target larger capacity production at a sole set-up.
4) Indian sugar industry produces more than one product out of the available raw products.
a) Molasses
b) Unrefined raw white sugar
c) Refined white sugar
d) Cane sugar
e) Granulated sugar
f) Brown sugar
g) Liquid sugar
h) Inverted sugar
i) Ethanol
5) Optimum utilization of by-products for additional revenue-
a) The diversion of sugar cane to the production of ethanol would boost the industry's
strong growth in ethanol demand, which would result in improved operational
profitability and a reduced cyclicality in the Indian sugar industry.
6) Captive power generation