India’s accelerating GDP growth and recent tax reforms have created “massive” opportunities for Unilever and its Indian subsidiary Hindustan Unilever, according to the multinational’s Chief Executive Officer Fernando Fernandez.

Speaking at a JP Morgan Fireside Chat, Fernandez said the companies expect to be key beneficiaries of what he described as a much more dynamic economic environment in India.

He noted that Indian consumption had been “significantly affected over the last three years due to double-digit food inflation”, but added that government measures were beginning to reverse the trend.

“I feel the government in India has taken very relevant measures lately. So, GST reduction, that is the VAT of India, personal income tax reduction, interest rate reduction, when the government does something like this, it’s because things in the economy are not right, and really that's what's happening the last couple of years,” he said.

He added that early signs of food deflation and robust economic performance were visible. “I think in the last quarter it was 8.2 per cent. So I see a lot of opportunities in India. This GST reduction affects 40 per cent of our portfolio,” Fernandez said. “I believe the GST reduction, the impact on the whole economy will be very, very significant.”

Unilever has recently overhauled leadership at Hindustan Unilever, appointing Priya Nair as CEO. Fernandez said additional leadership reinforcements had been made to strengthen volume growth.

“We have brought also another two CEOs into our Indian leadership team, the CEO of Hero MotoCorp, as the CFO of the company, the CEO of Britannia, as a head of our Food business. They have the mission of really putting our volume growth in similar level to the one of GDP growth, it will take some time, but I'm very confident of the opportunity,” he said.

Sharing insights from his recent visit to India, Fernandez highlighted the scale and diversity of the country’s consumer base.

“Opportunities there are massive,” he said, pointing out that India has 60 million people with a per capita income comparable to France. “You have 700 million with income per capita of Indonesia, Thailand, Philippines and another 700 million with the income per capita of East Africa and West Africa. There is growth for everyone in India. And we believe that we will be the main beneficiaries of what will be a much more dynamic economic environment in India.”

He added that Unilever’s product portfolio is well positioned for the expected expansion in household prosperity. “Our brands are perfectly suited to really take advantage of what will be an explosion of wealth expansion. So I'm super excited with India.”

Hindustan Unilever remains Unilever’s second-largest market globally by revenue after the United States, contributing around 12 to 14 per cent of total sales.