Counterfeit Products 25-30% Of The Market In India: Report

Counterfeiting activities are impacting the sustainable growth of the major industry in India, including Pharmaceuticals, FMCG, Automotives, Apparel, Consumer Durables/Electronics, and Agri products, according to a new report released by ASPA and CRISIL. The report is based on an independent survey conducted with consumers and retailers covering twelve Indian cities (Delhi, Agra, Jalandhar, Mumbai, Ahmedabad, Jaipur, Indore, Kolkata, Patna, Chennai, Bangalore, and Hyderabad) to gauge their perception of counterfeiting in several key sectors.

An important finding of the survey was that consumer perception pegged the extent of counterfeiting at 25-30 per cent of the market, higher than the general industry expectations. Counterfeiting is most prevalent in FMCG, Apparel, and Agrochemical sectors (30 per cent), followed by the pharmaceutical, automotive, and consumer durables sectors (20-25 per cent). The survey also reveals that almost 89 per cent of consumers acknowledge the presence of fake products in the market and are often compelled to buy counterfeits for reasons such as sensitivity to price, demand-supply gap, desire to buy luxury brands, peer pressure, and social motivations.

However, nearly 27 per cent of the consumers were unaware that the product was counterfeit at the time of purchase, making it more important to spread awareness about the issue and identification methods in fighting fakes. The report found that counterfeit products found in Pharmaceuticals are up to 20 per cent, in Consumer Durables up to 17 per cent, and 16 per cent in Agrochemicals. Even after discovering that the product is fake, consumers take close to negligible action about reporting it.

“Illicit goods trade stood at Rs 2.6 trillion in FY 2019-20 in India and affected almost all sectors. It is on the rise and heavily bleeding the country, industry, and consumers by large. An aware consumer holds the power to fight this menace; however, we must enhance consumer awareness about this issue. Consumers play the most crucial role in fighting against fakes. When many consumers are unaware of the actual threat from counterfeits, the country will never be able to harness the strength of active consumer participation in curbing the sale of fake products in the market,” said Nakul Pasricha, President of the Authentication Solution Providers’ Association (ASPA).

Suresh Krishnamurthy, Senior Director, CRISIL Market Intelligence and Analytics, said, “Counterfeiting is not limited to high-end luxury items. Even common items, from cumin seeds to cooking oil and from baby care items to medicines, are increasingly reported as counterfeit. An important finding of the survey was that consumer perception pegged the extent of counterfeiting at 25-30 per cent of the market, higher than the general industry expectation.”