As consumers in crisis-hit Europe and the United States cut back on non-essential items, multi-national companies are increasingly turning to fast-growing emerging markets to drive sales.
More from GlobalPost: India: Ikea to invest $1.9B, open 25 stores
This explains Coca-Cola Co’s decision to more than double its planned investment in India over the next eight years to $5 billion, from the $2 billion announced in November, as it seeks to capitalize on the country’s large youth population and rapid economic growth.
More from GlobalPost: Emerging economies give Coca-Cola’s 1Q earnings a boost (VIDEO)
“India is a wonderfully diverse country. Dynamic, young and emergent,” chief executive Muhtar Kent said today in New Delhi, according to Bloomberg.
Coca-Cola wants to expand its distribution network and manufacturing capacity to get more of its beverages, including Coca-Cola, Diet Coke, Fanta, Sprite and Minute Maid, on shelves throughout the vast country where its sales soared 20 percent in the first quarter, compared with just two percent in North America.
The Atlanta-based drinks manufacturer has invested just $2 billion in India since re-entering the market in 1993, so today’s announcement marks a significant expansion for the company, Agence France-Presse noted.
“The country's demographics, economic and social parameters are all huge drivers of growth and we have to ensure that we continue to grow our offerings to be the non-alcoholic, ready-to-drink beverage company of choice for local consumers," Coca-Cola India president Atul Singh said in a statement.
India is currently the seventh largest market for Coca-Cola, but Kent believes there is enough untapped demand to push the country into the top five in terms of volume.
“We think there’s potential here,” he was quoted by the Wall Street Journal as saying.
According to Bloomberg, only 12 Coca-Cola products are consumed per person annually in India, compared with 38 in China and 40 in Kenya. The global average is 92.
More from GlobalPost: India economy: How bad is it?