The Current Scenario of Indian Incense Sticks Market and Their Impact on the Indian Economy

The burning of incense sticks is a common practice around the world either as a part of their custom, for fragrance or as insect repellent. The market of incense sticks is rapidly increasing worldwide, due to their high demand in our everyday life. It’s application in not only restricted to worship, instead it is used for meditation, yoga and aroma therapy. The global incense sticks market is currently dominated by United States of America (USA), Brazil, China and India. The low labor costs, availability of raw materials, has drawn the attention of the whole world towards India, and as a result, India is now one of the largest producer and exporter of incense sticks. Some of the Indian states are leading manufacturers of incense sticks. Indian incense sticks market contributes a major share in the economy of the country. The Indian incense sticks market is dominated by South-India especially, Tamil Nadu, Karnataka having the popular Mysore scents and some other world renowned brands. There is a high turnover of incense sticks market, which draws the government’s attention towards them. The current review deals with the market potential of incense sticks in India, purchasing patterns, and current global competitors of Indian incense sticks.


INTRODUCTION
Incense sticks are long, cylindrical structure, having a bamboo core coated with fragrant materials, which, on burning, fills the atmosphere with fresh air and aroma (Lin et al., 2008). Incense sticks are used for many religious purpose, in order to purify the bad air and fills positive energy in the atmospheres and eliminates negative energy from our surroundings (Jetter et al., 2002). Incense sticks holds a significant place in almost all the religions and used during various ceremonies and rituals in temples, churches, mosques, monastery etc. Indian incense sticks market has grown rapidly in the last decade and currently it is catering in more than ninety countries in the whole world. The lightning up of incense sticks is traditional practice followed from ancient times whose records are available in India, Greece and Egypt. In, India, the lightning up of incense sticks at all the deity purposes is mentioned in Vedas. In India, incense sticks is also called as -Agarbatti‖ (Hazarika et al., 2018) which is derived from a Sanskrit word -Agaravarthi‖ where, -Agar‖ means ‗aroma' and -varthi‖ means ‗grief'. Indian incense sticks size generally varies from 8-12 cm in length, while, their size may vary with countries and religions (See et al., 2007). The burning of 2-3 incense sticks at a time is a common practice in most of the Indian houses during the worshipping God. The demand of incense sticks in India drastically increases during the major festive season, i.e. Diwali and Dussehra. The incense sticks in India are prepared either by conventional process at home or alternatively, by using large machines in the industries.
In India, incense sticks manufacturing is included as a sub-class of cottage industries that engages mainly women's of rural area (Hazarika et al., 2018). Currently, the incense sticks manufacturing falls under the ministry of commerce and trade, Government of India (GOI). Though the composition of incense sticks varies from one industry to another but its major components are charcoal powder, sticky powder such as Jigat, Sal resin, Guggul, Nargis powder, raw bamboo sticks, (Hazarika et al., 2018) water, various variety of oils, aromatic essence, flower essence, sandalwood oil, rose petals, natural and chemical aromatic ingredients, sawdust, and various color powder. Moreover, based on the demand and fragrances regimes, two types of incense sticks are commercially manufactured in India, namely perfumed and masala. In manufacturing perfumed incense, powders of charcoal, Gigatu, white chips, etc. are mixed with water to obtain a semi-solid paste. This composition is taken on a wooden plank and then applied to sticks by rolling with hands or with an automatic incense stick making machine. Production of incense sticks comprises following steps in chronology:(1) Bamboo stick production for the central core, (2) Production and preparation of Jigat powder, (3) Production of sawdust and charcoal powder, (4) Preparation of incense paste (masala) and its application on the bamboo stick to produce the incense sticks, (5) scenting or application of perfume, for a good quality, and (6) packaging. As the incense sticks demand is unending in India, so it is sold by all means of trade, and distributed to locals by retail mode. Due to the retail mode, there is positive effect in selling due to which the growth is to be around 6% Compound Annual Growth Rate (CAGR) in the coming years. The Indian incense sticks and Dhoop (a form of incense product) industry is the highly export-oriented industry, which provides huge profit to the Indian economy. The Indian export of incense sticks and Dhoop is increasing every year, which helps in balancing the trade deficit of India. 1. Incense sticks market at a glance in India In India, there is a high demand and utilization of incense sticks from ancient times only due to its religious values. The foremost utilization purpose for incense sticks in India is for religious purpose, especially in all the rituals and ceremonies (Staub, et al., 2011). India is one of the largest manufacturer and exporter of incense sticks leaving behind USA and Brazil. The importance of incense sticks is rapidly increasing due to which it has drawn the attention of the Indian government. Further, as per the study conducted by Ray and Biswas in 2014, reported that there are 10,000 Incense sticks manufacturing units in India, including miniaturized scale and small, along with another 200 well-established units having more than 50 marked Incense sticks, giving business opportunities to about 8,00,000 family household workers (Ray &Biswas,2014); (Hanumappa, 1996;NCAER, 1990). In India generally two-three incense sticks are burned during worshipping while African country like Nigeria lights up ten or more than ten incense sticks at a time. The founding of incense sticks industry is totally based on the factors such as availability of the raw materials for incense sticks like fragnance, bamboo, and cheap labor.

Status of incense sticks market in India
Incense sticks is a fast moving consumer good (FMCG) item with a good shelf-life and is one of the rapidly growing industrial sectors of India (Hazarika et al., 2018). The entire business possesses are shared in between joint operations of farmers, raw material providers, manufacturers, local and international traders, retailers and customers. India has a leadership status in incense sticks production, fulfilling a substantial proportion of world's necessities. The growth of incense sticks manufacturing and trade in India plays a substantial role in attracting domestic and foreign markets. The interest for incense sticks is increasing in local as well as international markets which is mainly due to the continuous improvement in quality and increase in product types. Owing to this, the administrations at national and state levels exploit this industry for masking their destitution projects. The purchasing limits of individuals grabbed the eyes of makers, due to which low-quality incense sticks brands have attacked the business sector to suit the distinctive social requirements. India exports out substantial incense stick varieties that are endowed with normal, colorful aromas. Moreover, incense business is rapidly increasing in India, due to less investment in the form of machinery and labor. Besides, the absence of technology entanglements and simple accessibility of scents in the market have prompted an uncontrolled development of this industry. Currently, the incense sticks business assumes a critical role in India's rural economy, giving employment to a vast number of the provincial rural population especially women's (Balasubramanyam, 2013).

Market size of Indian incense sticks
The new planning for import exchange control came into drive in the 1942, assisting the incense sticks industry to start importing chemicals, fragrances and other ingredients, specifically as opposed to heading towards the importer. Currently, the GOI (Government of India), don't have exact data of incense sticks production, utilization, import and export. So, the analysis of exact size of Indian incense sticks market is carried out through various survey conducted by several agencies time to time. According to the market survey performed by the National Council of Applied Economic Research (1990), National Group of Connected Financial Exploration (1990), the total incense stick production level in India in 1990 was 147 billion, esteemed at around 130645900 US$ (Ramya, Palanimuthu, & Dayanandakumar, 2013). Further, as per the study performed by Doddamani in 2001, it was revealed that India produces around, 60,000 mts/annum of incense sticks, at an annual developing rate of 10% (Doddamani, 2001). As per an article published by franchisie.com, in June 2018, Indian incense sticks provides jobs to nearly 20 lakh people across whole India which includes 80% women alone (Hazarika et al., 2018). Further, it was stated that Indian incense sticks market are growing at a CAGR of 15%, it is expected to grow exponentially reaching ₹12,000 crores in the upcoming five years transforming this particular segment even more. Similarly, another article published by economic times June 2018, revealed that All India Agarbatti Manufacturers Association (AIMA) incense sticks has yearly turnover of about ₹2,000 crores with 20% growth rate on an annual basis. Hazarika et al., 2018 reported that there is utilization of around 3-4 million tonnes of incense sticks alone in India and comprises of 70% utilization of the world. Currently, the Indian incense sticks utilizes bamboos for manufacturing incense sticks around 35,000 mts/annum. India's population growth has given an expected market size of ₹1250-1500 crores (Jayaraj, Hazarika, Dutta, Biswas, & Dutta, 2018). Kolkata has the largest market for sale of incense sticks by volume in the country at ₹150 crores or so, in the ₹1,000 crores national incense sticks market. 4. Progressive production, export and future of Indian incense sticks market The Indian incense sticks market is limited to around 450 major industries. Besides this, there are several small units also which produces incense sticks but they have engaged only with local market. India is a top exporter of incense sticks which has noticed a 30% increase in the export in the last five year period. According to all India agarbatti manufacturing association (AIAMA) assumption, this could be because of some favorable factors like, availability of raw materials, labor and investments in India in comparison to China and Taiwan among other South East Asian nations. As of now, India is exporting incense sticks to the USA, United Kingdom (UK), United Arab Emirates (UAE), Belgium, Brazil and Argentina, amongst a few different nations. In India, the incense stick manufacturers extend from Tribal Welfare Mission under the Khadi and Village Industries Commission (KVIC) to Auroville in Puducherry and from small factories to FMCG giant ITC. A gradual increase in the production and export of incense sticks in various financial year concluded a subtle increase from 1989-2020. In 1989-90, the total Incense sticks production was assessed at 147 billion and total domestic sales were estimated as ₹7.1 billion (approx. US $ 198 million) while exports represented a surplus extent of ₹1.5 billion (US$ 42 million). Exports have been witnessing consistent rise in recent years, with 1993-94 esteem recorded at ₹4 billion (US $ 112 million) (Hanumappa, 1996, NCAER, 1990. As per Rao et al., in 2009, nearly 208 billion, incense sticks were produced which is estimated to grow at nearly 20% every year (Rao et al., 2009). The India Incense sticks and Dhoop market size was more than ₹3000 crores in 2011-12, with high sales in the rural regions. The Incense sticks business has yielded ₹2000-crores per annum, quite significantly originating from cottage level on rural India (Balasubamanyam, 2013). According to Ministry of Commerce, Government of India (GOI) data, India have exported incense sticks worth $498.02 million between the 2012 and 2016 monetary years. Of note, yearly exports noticed 11.57% growth, rising from $89.64 million (FY2012) to $100.02 million (FY2016). In FY2016, USA were the largest importer of incense sticks from India with $11.3 million import estimation, trailed by UAE ($6.23 million) and Nigeria ($5.85 million) (Kumar, 2017). While in 2016-17, India has figured out the export of incense sticks worth over ₹400 crores, just about 10% of the worldwide incense market. Hazarika et al. (2018) reported that India's population growth has given an expected market size of ₹1250-1500 crores to the Indian incense sticks (Jayaraj, Hazarika, Dutta, Biswas, & Dutta, 2018). Further, according to KVIC, a reduction of more than 14% in the sales of incense sticks was noticed from ₹3.69 crores in 2017-18 to ₹3.16 crores in 2018-19. This could be due to the increase in the Goods and Sales Tax (GST) on the incense sticks and their products upto 18%. Further, though GST was reduced from 14% to 5%, but no any major difference was observed as the total sales have touched only ₹1.94 crores so far in 2019-20. According to the article published in prnewswire.com in June 2018, it is found that the incense sticks market has observed continuous increase in the growth rate since last five years and is forecasted to reach market size by volume of more than 34000 sticks of incense sticks and Dhoop in 2022-23 (Prnewswire 2020).

Zone wise incense stick production in
India India's incense sticks industry is mostly as of cottage industry and is majorly labor intensive which employs mainly women of rural area. Though the incense sticks industries in India are widespread in the whole India, but as per the production it can be classified into four zones:-1) South India, 2) West India, 3) North India and 4) East India. The south-Indian industries are most dominating industries which includes, Karnataka, Andhra Pradesh, Kerala, Telangana, and Tamil Nadu. Out of all these South-Indian states, Karnataka is prevailing with industries like Mysore scents, Moksh agrbatti, and cycle agarbatti. The percentile residential offer of incense or incense sticks in 2009-2010 in South-India is approximately 35% of domestic sales that is around ₹7.1 billion (approx. US$ 198 million), with West-India representing 30%, North-India representing 18% and East-India contributing to 17%. Significantly, around 66% of local incense sticks utilization occurs within the country and out of which incense stick consumption being noticed in rural areas (61.23%).

State wise production and distribution of incense sticks industry in India
The cutting edge period of incense sticks manufacturing in Southern India first began in Thanjavur disytrict of Tamil Nadu, from where it gradually extended to different parts of neighboring states. The incense sticks industry presently reigns in Karnataka, Andhra Pradesh, Kerala, Odisha, Tamil Nadu, Gujarat, Dadra and Nagar Haveli, Bihar, Tripura and Assam. Karnataka occupies the top position amongst the competing states, with Mysore and Bangalore (substantially, urban areas) amongst the major manufacturers (Madhur Bakhle, Shivani Gite, Ameya Poyarekar, Ayaz Siddiqui, & Patil, 2016); (Mark Holmström, 2007).

Gujarat & Odisha Gujarat Agarbatti Manufacturers & Dealers
Association (GAMDA) is a stage for incense stick manufacturers, merchants and all other people who specifically or indirectly, manage incense sticks business. The GAMDA is persistently trying to introduce quality items in the worldwide market with just about 200 processing plants being identified keeping incense sticks are running in Ahemdabad. Strikingly, half of these ventures specifically manufacture incense sticks, either physically or through machine utilization and a portion of enterprises being engaged in value-added work. For instance, scenting, packaging and marking activities, in wake of purchasing, moved incense sticks away from the incense sticks producers (Bureau, 2019). Gujarat state has more than 560 registered incense sticks suppliers, of which, majority are confined in Ahemdabad (Mahadevia et al., 2014).
Aurobindo Ashram and Gayatrin Ashram of Odisha are associated with manufacturing of fragrant incense sticks under the brand names, Parimal Agarbatti, Berhampur, Suravi, Susree, Indica. The raw materials are used to bring from Cuttack, Bhubaneswar and Calcutta. ORMAS, a government of Odisha agency working for livelihood and development, has developed a tie-up with Incense sticks division of ITC Limited.

Maharashtra
The state of Maharashtra is currently a hub of incense sticks industries, such as in Pune, wherein more than 76 incense sticks manufacturers reside with their production (Hazarika et al., 2018). Gadchiroli Agarbatti Project (GAP) of the forest divisions of Gadchiroli district, Maharashtra has 21 incense sticks production centers (483 machines), spread over the whole area. With an objective of 44 distinct centers, work is in steadily advancing mode towards accomplishing itself by the mid of 2014. These centers right now provide an employment to approximately 500 people, with 95% being ladies. As of now, 220 tonnes of raw incense sticks produce are sold to merchants and producers based outside Nagpur. The Wadsa forest Division of Gadchiroli district with its 5 units i.e. Porla, Sonsari, Gothangaon, Wadegaon and Kurkheda.

Bihar and West Bengal
There are around 42 registered incense sticks manufacturers in Bihar excluding the unorganized and rural sectors. As many as 50,000 women are said to be associated with incense sticks rolling activity in the Gaya region, Bihar (Hazarika et al., 2018). After independence, incense sticks manufacturing industry first started in the Southern West Bengal after at Fultala of Baruipur district-24 Parganas. Thereafter, several large and small incense sticks based industries came into existence in Piyali Town, Fultala, spreading to Canning Block 1 and 2 and different parts of Baruipur, that provided job to thousands of families. At present, incense sticks industry assumes an indispensable position in the efficient advancement of this region and is swiftly emerging as the vocation of the general population in Fultala and also a larger part of Baruipur and Canning. As per the study carried out by Barua, 2011, it was mentioned that Baruipur Agarbatti Manufacturers' Welfare Association (BAMWA) West Bengal has 112 assembling units with as many as 56000 representatives and ₹ (40-45) crores annual turnover in the year 2011 (Barua, 2011).

Andhra Pradesh and Tamil Nadu
According to a report of 2006, there were about 150 units of incense sticks exist in Andhra Pradesh whose marketing is quite significant locally apart from ITC, Chennai. The production limit was 10 tons on monthly basis, which would be progressed to 100 tons for every month bymid-2006. This activity receives an income of ₹18,000 per ton as against ₹ 1,500 per ton, being harvested from pulp and paper mills.

Karnataka
The Karnataka region, generally known as the Capital of -Agarbatti‖ is the main Indian Incense sticks producer, with Mysore and Bangalore being the primary manufacturing centers (GOI, 2019). As on today, around 1000 units prevail through the Province of Karnataka out of which around 67 that were established in Bangalore (Reddy 2013). It is considered that now just (30-40) % of the Indian production comes from Karnataka, with the extent being pegged at 95% during 1960's. The Mysore district is perceived as a pioneer in the Incense sticks manufacturing and this is one of the principle group exercises prevailing in the city (NSDC, 2016). Incense sticks manufactured in India, in particular from Mysore has a worldwide recognition and has a significantly better quality compared to other contending countries (Doddamani, 2001).

Major Indian incense sticks industries and their brands
The Indian incense sticks market is dominated by few world renowned companies which produces incense sticks of different fragrances and types. Moreover, these industries are also involved in manufacturing of other incense products dhoop, cones etc. in addition to incense sticks. The industries which have a major share are given below:- Patanjali Ayurved Limited -Astha, Madhuram "Moksh Agarbatti" is a Bangalore-based enterprise has brought in ‗better packaging and modern design' concepts leading to raised demands which raised the export market.' Another Karnataka based incense sticks industry is Cycle, owned by ITC limited. It is mainly based in Mysore area which has been around for over five decades, is clearly the market leader. Being the largest incense industry, the export stats of this brand account for 10% of the company's production. Cycle brand produces pure Incense sticks, the leader brand of Mysore-based NR Group is one of the pioneers of Indian Incense sticks industry (worth ₹ 1,500 crores) with a 15% share in the organized market, trailed by ITC exports to as many as 40 nations. The brand is a source of handmade Incense sticks, prepared extensively by female workers from remote parts of Karnataka, Andhra Pradesh and Odisha. These units supply fragrances in the homes of Brazil, Chile, the USA, Japan, Africa and Chile. Currently it is exporting incense sticks to more than 60 countries in the whole world.
ITC's marketing muscle, Mangaldeep is available across the length and breadth of the country. It began promoting Incense sticks in 2005 by overhauling the make of Incense sticks manufactured by villagers and small scale producers. The industry currently sources several of its necessities through tie-ups with Sankranti, Ananth and Jyanti domestic products (all from Bangalore), Cottage industry of Aurobindu Ashram (Pondicherry), Prayer Agarbatti (New Delhi), Swastik Industries (Chandigarh), Jayanti Products (Agartala) and KVIC (mainly Coimbatore). At present, ITC's Mangaldeep holds 10% share and hopes to garner around 18% in the next couple of years, although present production stands at 30% from the last three years. ITC is the second biggest sector dominated by chaotic player currently engaged in establishing Perfume and Packaging center for Mangaldeep brand with a share of ₹3,000 crores which is right around 5%. The organization has connected with 20 small units engaged in Incense sticks finishing, which together supply around 700 million-incense sticks on monthly basis. In an offer to intensify the yield, the organization purchases raw Incense sticks from self-help groups of six states: Karnataka, Tamil Nadu, Tripura, Assam, Odisha, Andhra Pradesh, Chandigarh, Delhi and Bihar. Mangaldeep has signed agreements with state governments across the nation, including those of Odisha, Assam and Tripura, in light of the incense sticks business' capability to provide sustainable livelihoods for rural India. Mangaldeep, in its entire value chain, employs 20,000 people, majority of which are rural women. ITC has now entered the industry as a national player, purchasing the handmade products from sellers. It has five lakh retail outlets in the country, which have doubled their production.
Another, Mysore based incense sticks industry is Mysore Scents. Mysore's fine -Agarbatti‖ was established in 1958 in association with a local partner. Mysore Scents now produces over one billion incense sticks every year that are exported to over 40 countries and sold in India under the Aroma India brand. The products of this enterprise are available at 13,000 outlets in the US and over 1,500 outlets each in Europe and Japan. Its turnover was ₹31 crores in FY13, improving by 10% from that of FY12. The Kandla factory has a capacity to manufacture one billion sticks a year and employs over 200 people. The target is swiftly marching ahead, with nearly 40% increase in capacity over the next five years and at least 15% increase in annual turnover.
Another renowned incense sticks industry is Hindustan Lever which have endeavored to enter the industry to use their expansive circulation network through the machine-made incense stick route, which appealed on aesthetics despite not being exceptionally fragrant.

Purchasing pattern of incense sticks in India
The demand for incense sticks sharply increases during the festive season like Dussehra and Diwali days, both in domestic and international markets. The market for incense sticks is tremendous, whereby interest for these commodities is high even in the farflung rural areas. The incense industry is driven by factors other than commerce such as superstition, tradition and religion. In India, shoppers are profoundly focused among the rural pockets (61%) (INBAR-1994;Jenner and Reza, 2008). The low-salary group buys about 46% of the Incense sticks produce while the higher income group customers purchase the rest. However, categorizing purchases into five income classes deciphers an inverse relationship between income and purchase extent. Presence of negative income and price flexibility may possibly be the contributory factors to this scenario. The variables affecting purchasing choices include quality, fragrance, cost and brand name preference. 9. Close competitors of India incense sticks in the global market Incense sticks textures and usage forms have changed from merely being religious to several other needs and purposes. They offer psychological benefits by soothing the mind and enhancing meditation experience. Initially, India was the key producer and exporter of incense and incense sticks, which has recently been facing a stiff competition from countries like China, Japan, Thailand and their perspective neighbors. Local market is a few factors larger than the export one. Incense sticks industry is one of the labor-intensive and cottage type traditional industries of India. The market, ruled by Indian incense industries, and faces intense rivalry from Chinese and Thai makers who offer more options and varieties in their packaging and distribution. Apart from the US and Europe as extensive markets for Incense sticks exports, the South American market has recently been emerging as a key attraction to promote incense sticks trade in a significant manner. Chinese and Thai incense stick exporters, have nonetheless, begun introducing packaging and design advancements to compete with the standards of Western markets, that has pushed Indian Incense sticks producers to go with the same pattern. Incense from China and Thailand have begun filling the ₹4,000-crore worldwide incense stick market, shaking the customary Indian fortress over the business. The turnover of Indian Incense sticks manufactures, is ₹1,800 crores turnover, whereas the advertisement includes worth around ₹5,000 crores and the export has contributed only around ₹457 crores. The turnover of Indian incense sticks market is increasing annually 10% on annual basis.