India currently boasts the fourth largest retail market in the world, experiencing significant transformation and tremendous growth over the past decade. This sector continues to be a major force both domestically and globally.
According to a report by the Boston Consulting Group (BCG) and the Retailers Association of India (RAI), India’s retail market has grown from $820 billion in 2023 and is poised for further growth, projected to reach $2 trillion within the next decade. The market is expected to hit $1.1 trillion by 2027 and $2 trillion by 2032, growing at a compound annual growth rate (CAGR) of 25%.
To capitalize on India’s retail boom, numerous global brands are entering the market. Reliance Brands Ltd., the retail arm for high-end labels, is set to introduce several international brands by 2025. Following the successful launch of Sephora in 2023, Reliance Retail, led by Isha Ambani, will bring six global brands to India: Old Navy, Armani Cafe, Asos, Shein, EL&N Café, and Sandro and Maje. These efforts are supported by the opening of Jio World Plaza, the country’s largest luxury mall, in Mumbai’s Bandra Kurla Complex.
India’s appeal to global brands is driven by its young population and rising disposable income. Deloitte estimates that India will become the third-largest consumer market by 2030, behind the United States and China, with the addition of 110 million middle-income households and 14 million high-income households fueling retail spending.
The retail sector is a significant contributor to India’s GDP and employment, accounting for over 10% of the GDP and employing approximately 8% of the population. Deloitte India’s “Future of Retail” report projects that online retail will grow at an extraordinary rate, outpacing offline retail by 2.5 times over the next decade. The online retail sector, valued at $70 billion in 2022, is expected to surge to $325 billion by 2030, driven by rapid e-commerce growth in tier-2 and tier-3 cities.
India is increasingly seen as an attractive destination for global retail investors, with many foreign brands active in the market. McKinsey FashionScope predicts that India will welcome hundreds of global brands in the coming years. Rediff reported that around 25 international retail brands are expected to enter India in 2024, with the number of foreign brands entering the market steadily increasing each year.
Anarock Retail’s CEO, Anuj Kejriwal, highlighted the rising spending power of urban Indian consumers and the growing popularity of branded products in categories such as apparel, cosmetics, footwear, watches, beverages, cuisine, and jewelry.
Experts attribute India’s attractiveness to its economic growth and openness to global trends. NDTV Profit, citing Franchise India Holdings Ltd., reported that at least 160 international retailers are currently seeking partners to enter the Indian market this year. This influx of foreign brands is expected to open 5,000 stores across India over the next five years, with a cumulative investment of about $250 million, according to Franchise India Holdings Chairman Gaurav Marya.
Source – timeskuwait.com
