India is this year’s Guest of Honour country at the 2019 Guadalajara International Book Fair (November 30th to December 8th ). To help you brush up on this exciting and growing market before packing your bags for the fair, we will be sharing excerpts all month of our 2018 market guide on India, written by expert consultant Jaya Bhattacharji Rose.
India, with a population of over 1.3 billion, has an estimated literacy rate of 74.4%. India is also the sixth-largest book market in the world and the second-largest English-language book market. According to Nielsen’s India Book Market Report 2015: Understanding the India Book Market, the sector is worth approximately USD$6.76 billion. Led by educational books, the English-language sector is set to grow by 19.3% annually until 2020 compared to growth of less than 2% for global book publishing over the next five years, according to PwC. Including Indian-language book markets increases the growth projection substantially for a more realistic estimate of the overall size of the book market in India. The K-12 market contributes maximum to the print book market. The Children’s Trade Book Market was estimated at INR 6 Billion or 90.9 million USD or 0.09 billion USD for 2017.
India’s book market has a poor record of maintaining statistical data. Most of the information must be gleaned from anecdotal evidence or verified by various means before deriving a nuanced picture of the industry. Over the years there have been occasional reports by the National Council of Applied Economic Research (NCAER), the National Book Trust (NBT), the Publisher’s Association (UK), the Federation of Indian Chambers of Commerce and Industry (FICCI), and Nielsen. It is only recently that Nielsen set up its Indian office and began to collect and collate data, building their catchment area methodically. In August 2017, Nielsen announced its first partnership with one of the largest Hindi newspaper groups, Dainik Jagran, to launch the Hindi bestseller list, to be announced every quarter.
Geographically, India is vast enough to be considered a subcontinent. It has a federal form of government with a central government and 29 states, mostly created on the basis of linguistic identity. Officially only 22 languages are recognized by the constitution whereas it is said that the language changes every 20 kilometres in India. The big six languages—Hindi, Bengali, Telugu, Marathi, Tamil, and Urdu—are each spoken by more than 50 million people. There is no national language in India, but Hindi and English are used officially. Given that Hindi is predominantly used in northern India, English is the lingua franca as the language of commerce, law, and social mobility. It is difficult to estimate the total number of English-language speakers, but they constitute a significant majority as English is a compulsory subject for undergraduates in many universities and is taught at some stage to all school students.
The book market of India is thrilling because of its rich diversity. Given that India consists of so many distinct languages, it provides a set of markets within a market. It is impossible to consider India homogenous as every region has its own distinct identity and character and these in turn inform people’s book buying and reading habits. According to Thomas Abraham, Managing Director of Hachette India:
The English market is a bit complex to an outsider approaching it for the first time, but is fairly easy to understand when you learn the ropes. The key differences in terms of problematic issues are low price points, low margins, a distributor layer still in place that for the most part knows nothing about book content and operates on discount–returns negotiations, completely untenable credit cycles. The plus point, and a key one, is the demographic dividend that lies in wait for those who are willing to look at a ten-year horizon. So that’s the key test for forays into India—this is not the country to come to if you want to operate in 3-year window [of business plans].
The classic examples are the setting up of Penguin India (est. 1987) and later HarperCollins India. These two took the early mover’s advantage. HarperCollins entered India through a joint venture with Rupa Publications in 1992. A few years later they moved to the Today Group, a media house. Once 100% direct investment was allowed in India, HarperCollins India (HCI) became an independent entity. Penguin in particular actually developed the trade market from scratch and today enjoys a dominance that looks unshakeable for the next 30 years.
Yet, as with any other territory, there are a few challenges too, such as the fragmented nature of publishing and bookselling, a tortuous distribution system, long credit cycles that make it difficult to manage cash flows, and increasing direct costs. For example, under the new GST taxation system (introduced 1 July 2017), direct costs have increased; since books are a non-taxable commodity, publishers cannot avail themselves of the input tax credit. Moreover, piracy is widespread, with virtually every street in the country home to stalls selling pirated texts.
Want to find out more about the Indian book market? Download your copy of our market guide today!