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Navigating The Restaurant Industry in India

Updated: Aug 11, 2021

The origin of the concept of ‘restaurant’ comes from the French word ‘restaurer’ (provide food for). Since the early 250 BC, taverns or inns have provided food to hungry travelers around the globe. Yet, the idea of eating locally outside one’s home has traditionally been a rare sight in India. So, how did the restaurant industry in India flourish to become an INR 4 trillion trade in 2020?

A peek into the history of restaurants in India will give us an idea as to how trade brought about this very concept and has also facilitated its manifold growth to become

‘The Restaurant Trade’.

History and Evolution of the Eating Style in India

The earliest incidences of people eating outside their homes in India have been found in literary and historical records, where people would buy sweets or snacks like bhajiya, samosa etc. from shops or stalls revolving around the ‘bazaars’. Records of avid travelers like Ibn Battuta also provide evidence that the expansion of the market-place beyond being places of economic transactions encouraged people to sell food in most Indian towns and villages.

The presence of regional, religious and cultural diversity in India has led to a varied difference in the eating pattern throughout, thus leading to the evolution of Indian cuisine and consequently , the restaurant industry in India.

As international cultures interacted with that of India, we were also greeted with various novel ingredients. The Indian Hindu culture conventionally encouraged vegetarianism, but with the invasion of the Afghans and Mughals, the usage of meat based food was widely popularized. Chillies are native to Mexico, potato origins from South America, tomatoes were introduced by the Portuguese, cauliflower, and even the concept of tea by the British and saffron came with the Mughals. Thus, one can conclude that the Indian cuisine is an amalgamation of the flavours and delicacies of the rest of the world.

The restaurant industry in India back then, stayed limited to snacks and sweets. Beginning from the 8th century, the arrival of the Parsis introduced this new major lifestyle change of ‘dining out’. Infact, some Parsi restaurants continue to excite a huge audience, even after 100 years of existence (like Britannia & Co. in Mumbai, Dorabjee and sons in Pune etc.) Further, restaurants increasingly developed since colonialism, but the main mushrooming began with the British Raj.

How did the Interaction with the British tailor to the Restaurant Industry of India?

After centuries of exchange and transformation, India was even then under an extensive rule of the British. The East India Company arrived with an aim to trade, but they withal succeeded in ‘westernizing’ India. British influence on Indian food and culture brought about the concept of leisure. This appealed to the Indian Housewives with its idea of a new meal called ‘high-tea’; others, mostly men, were allured towards restaurants for entertainment, displaying a symbol of social status and maintaining relations with the English. Thus, pubs and restaurants meant for the entertainment of Indian public and interactions with Britishers began flourishing.

Furthermore, to facilitate trade, Indian Railways and Civil Services flourished largely. This also led to the establishment of a hospitality business- furnishing a restaurant industry in India inside and outside the trains. This growth was accompanied with an increase in disposable income and a general willingness even on the side of Indians to splurge on the unorthodox experience of dining out.

Even now, the company officials wanted to insert their dominance and show their superiority. So, they set up clubs, restaurants and bars, to which Indians were denied entry. This exasperated the countrymen enough to take grave steps to make the Britishers remorseful. For example, in Bombay, Jamshetji Tata was so angered over forbidden entry that he established the Taj Mahal Hotel, with an aim to spread the splendor of that hotel to overshadow the Yacht Club. Ergo, this was when the Indians set up the stepping stones for the restaurant industry in India.

Effect of the Partition in the Industry

The partition of Indian and Pakistan adversely affected a lot of lives. It left behind many homeless, unemployed and thousands perished. While India became home to many refugees seeking shelter, little did we know that they would end up contributing more towards shaping the restaurant industry in India. Many refugees took to opening small food stalls in areas where they had relocated. Regions of Punjab, Delhi and Gujarat were highly guided by the refugee restaurants.

One such famous eatery is ‘Kesar Da Dhaba’, Amritsar. It was originally established by Lala Kesar Mal and his wife in 1916 at Sheikhupura, Pakistan but moved to Amritsar after the partition of India in 1947. It is said that the Dhaba was routinely visited by Lala Lajpat Rai and Jawaharlal Nehru. Such eateries opened by the immigrants are also believed to have discovered butter chicken and familiarized Indians with the concept of tandoori chicken.

The very first revolution in the restaurant industry of an independent India can be said to be a result of the hard work and novelty brought about by the refugees.

Scenario of the Industry further after Independence

In the 74 years of India’s Independence, the eating and dining out pattern has transformed anew. We have dilated from casual dining and fine dining to quick service restaurants, cafes, pubs, bars, clubs and lounges. It has also expanded towards the provision of food delivery services. From visiting restaurants on special occasions and engaging them for celebrations, today we rely on them for our weekend outings and also for our day to day meals.

The trendiest growth in the restaurant industry of India has been the emergence of the ‘food delivery’ system. Around 125 years ago, during the British rule, the Dabbawala meal delivery system began in the major cities of the country. While we can still spot the dabbawalas, an online food delivery network has now expanded owing to the growing urbanisation in India. In areas such as malls, offices, and large-party orders for residential complexes, the latest e-commerce mode has earned a lot more consumers. Any working person who forgot their breakfast would simply order in. The convenience and ease of getting ready food at home enthralled a wide public.

When this model emerged, it was confined to the customers ordering food through a restaurant’s own website. Over time, it flourished to become a business model in its entirety. Now, the customers are facilitated with a single online platform by a business player and they can choose amongst the various restaurants connected with the portal.

Throughout the years, providers like Zomato and Swiggy have gained due recognition but there are numerous such portals expanding their customer base. Hence, it will be right to quote The Hindu that “It appears to be a case of multiple Davids banding against a few Goliaths, in a tussle that promises to be fascinating, and ultimately rewarding for customers”.

A survey by Rakuten in June 2020 showed that many Indians ordered less food during the pandemic and, instead, worked on their home cooking skills. Yet, the market value of the Indian restaurants and food service industry in the fiscal year 2020 has been reported to be about four trillion Indian rupees. The restaurant industry in India has been growing at a rate of 7% annually.

The ‘restaurant industry’ in the country has been highly accelerated by the expansion of trade and business, but overall, many factors including globalisation have helped the industry augment in India. It has been reported that "Indians on an average eat out lesser than 2 times a month, compared to 40 times in Singapore. Even a small increase in this number provides a huge market opportunity for restaurants in India." The industry thus has a long way to go in the future.

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