India’s growing demand a new frontier for WA sheep farmers

For decades, Australians have watched China’s meteoric rise from an agrarian society to a manufacturing superpower, reshaping global trade and Australian exports along the way.

We have also taken note of the Middle East’s transformation, with the oil-rich economies of the Gulf reinventing themselves as global financial and tourism hubs.

But amid these well-documented economic revolutions, another powerhouse has been growing in the background, largely unnoticed by Australian exporters and travellers.

India, the world’s most overlooked economic success story, is on the cusp of a transformation that could have profound implications for WA’s sheep industry.

India’s economic expansion is staggering.

By 2030, its GDP is expected to exceed $US6.8 trillion, making it the world’s third-largest economy, overtaking Japan and Germany.

To put this into perspective, India’s economy will be more than five times larger than Australia’s, which is forecast to reach only $US1.2 trillion.

But GDP alone does not capture the full significance of this shift. The real story lies in the rise of India’s middle class.

By 2031, India will have more than 100,000 millionaires in US dollars and 41 per cent of India’s population will be classified as middle class, up from 31 per cent in 2021.

By 2047, this figure could reach 60 per cent, bringing a billion new consumers into the global economy.

For Australian agriculture, this represents a profound opportunity, and yet the potential for sheep meat exports remains largely unexplored.

India boasts the second-largest sheep population in the world, with 74 million sheep, trailing only China’s 175 million and slightly surpassing Australia’s 74 million.

On the surface, this might suggest that India has little need for imported sheep meat. However, production growth in India is severely constrained.

With a population of 1.45 billion — increasing by 12 million annually — and limited grazing land, expanding domestic supply is a huge challenge. In contrast, Australia, with just 27.2 million people, has the potential to return to the 1980s when Australia’s sheep flock surpassed China’s.

Despite being a staple of Indian cuisine, per capita mutton consumption remains surprisingly low at just 0.7kg per person per year — nearly 10 times less than in Australia.

The key reasons for this disparity are affordability and access.

Until now, mutton has been a luxury product in India, primarily consumed by wealthier households and on special occasions. However, as incomes rise, this is beginning to change.

India’s demand for imported sheep meat is expected to surge in the coming decades, mirroring China’s rapid growth in beef imports.

In 2000, China imported just 100,000 tonnes of beef, but by 2015 this figure had skyrocketed to 1.2 million tonnes.

The biggest driver of future growth is the lifting of tariffs with the signing of the Australia-India Economic Cooperation and Trade Agreement in 2022, which eliminated a 30 per cent tariff on Australian sheep meat exports. Until then, Australia had exported negligible volumes of sheep meat to India.

With tariffs gone, Australian sheep meat now enjoys a price advantage over New Zealand, historically India’s primary supplier of imported lamb and mutton.

This trade breakthrough will set Australian producers up to mirror the early 2000s when economic growth in the Middle East fuelled demand for high-quality chilled Australian lamb, particularly in tourism-driven cities such as Dubai.

Today, India is undergoing a similar transformation, reflected in the rapid expansion of its luxury hotel market.

Valued at $US3 billion in 2025, India’s luxury hospitality sector is projected to reach $US4.83b by 2030, closely following the trajectory of Dubai’s booming market, which took off 25 years ago and is expected to continue growing strongly from $US9.6b to $US15b over the next five years.

Religious and cultural factors also work in favour of Australian sheep meat.

Unlike pork and beef, which face significant religious restrictions in India, mutton and lamb enjoy broad cultural acceptance.

Hindu dietary traditions largely prohibit beef while many Muslims avoid pork, making sheep meat one of the few proteins that transcend religious lines.

Moreover, India’s younger generation is more open to dietary change.

Between 2005 and 2021, the percentage of Indian men who reported eating meat weekly rose from 27 per cent to 44.5 per cent.

With 65 per cent of India’s population under the age of 35, this trend suggests a future in which meat consumption — including premium imported meats — continues to rise.

India is not just an emerging market for sheep meat imports; it is also positioning itself as a live sheep exporter.

With Australia phasing out live sheep exports by 2028, India has started stepping into the gap.

In 2023 alone, India exported 11,354 live sheep, primarily to the Middle East.

As Australia withdraws from this trade, India is looking to expand its presence, potentially providing another market for domestically grown sheep, opening gaps for Australian importers.

This shift raises an urgent question: can India realistically replace the markets Australia is set to lose with the end of live exports?

Austrade predicts that Australian sheep meat exports to India will rise from 800,000 tonnes to nearly one million tonnes by 2030.

But what about 2040 or 2050?

If India’s demand for sheep meat follows the same trajectory as China’s demand for beef and the Middle East’s growth in luxury travel, WA’s sheep farmers could find themselves at the centre of a new and lucrative export boom.

Omika Upadhayay is the policy editor at WAFarmers and a graduate of the Himalayan College of Agricultural Science and Technology