The retail sector in India is emerging as one of the largest sectors in the economy marking a compound annual growth rate (CAGR) of 5.9 per cent since 1998. The total market size of the sector is expected to grow from US$ 450 billion in 2012 to reach US$ 574 billion by 2015.
The organised retail segment in India is expected to be 9 per cent of total retail market by 2015 and 20 per cent by 2020. Net retail sales in India are also quite significant among emerging and developed nations; the country is ranked third after China and Brazil.
India's strong growth fundamentals along with increased urbanisation and consumerism opened immense scope for retail expansion. Further, easy availability of credit and use of 'plastic money' have contributed to a strong and growing consumer culture in India. The untapped rural market also has high growth potential.
The Government of India has approved 51 per cent foreign direct investment (FDI) in multi-brand retail and increased FDI limit to 100 per cent in single brand retail and for cash and carry (wholesale) trading and exports. Government has also introduced goods and service tax (GST) as a single unified tax system from August 2012.
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