Indian Economy News

India's retail market to touch US$ 2 trillion by 2033, says BCG.

  • IBEF
  • February 29, 2024

The retail market in India is forecasted to experience significant growth, projected to reach US$ 2 trillion within the next decade, as per a joint report by the Boston Consulting Group (BCG) and the Retailers Association of India (RAI). This optimistic outlook reflects changing consumer preferences towards experiential spending, such as travel and entertainment, over traditional purchases. Despite recent challenges, including a slight dip in year-on-year growth and subdued performance by some large retailers, the organized retail sector remains resilient, with consistent profitability aligning with global standards.

Since 2010, India's retail sector has expanded by over 200%, fuelled by a growing middle class and the influx of international fashion and food chains. The market is expected to sustain a growth rate of 9-10% over the next decade, highlighting its immense potential. However, success in this competitive landscape will depend on retailers' ability to adapt delivery models, leverage artificial intelligence (AI) and analytics, and implement cost management strategies effectively. Consumption patterns have also evolved, with goods and services registering varying growth rates between FY18 and FY23. Key consumption categories include food, beverages, clothing, housing, transportation, education, leisure, and personal care products. Consumption trends also indicate a shift towards services and premium products, with increased household savings and investments. Elite households drive demand for luxury items, while urbanization has fuelled consumption across cities of all tiers.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.