Retail industry in India is un-doubtingly one of the fastest growing retail industry in the world. It is the largest among all industries accounting to 10 per cent of the country GDP and employs around 8 per cent of the workforce. The market was worth around US$ 3 billion in 2013 and is expected to grow at a CAGR of 12 percent touching US$ 6 billion by 2019. India pipped China to take the top spot in retail sales in 2017, which surpassed the $1trillion-mark. In year 2017-2018, the Indian Retail industry grew at a CAGR of 13 per cent to reach USD 950 billion.
Indian retail market is divided into “Organised Retail Market” which is valued at $60 billion which is only 9 per cent of the total sector and “Unorganised Retail Market constitutes the rest 91 per cent of the sector
Forecast for the Industry
India’s retail market is expected to increase by 60 per cent to reach US$ 1.1 trillion by 2020, on the back of factors like rising incomes and lifestyle changes by middle class and increased digital connectivity. While the overall retail market is expected to grow at 12 per cent per annum, modern trade would expand twice as fast at 20 per cent per annum.
India’s Business to Business (B2B) e-commerce market is expected to reach US$ 700 billion by 2020.On line retail is expected to be at par with the physical stores in the next five years and has grown 23 per cent to $17.8 billion in the next year.
Indian e-commerce sales are expected to reach US$ 120 billion by 2020 from US$ 30 billion in FY2016. Further, India's e-commerce market is expected to reach US$ 220 billion in terms of gross merchandise value (GMV) and 530 million shoppers by 2025.
India’s direct selling industry is expected to reach Rs 159.3 billion (US$ 2.5 billion) by 2021. India is expected to become the world's third-largest consumer economy, reaching US$ 400 billion in consumption by 2025.
Modern Retail in India
Luxury market of India is expected to grow to US$ 30 billion by the end of 2018 from US$ 23.8 billion 2017 supported by growing exposure of international brands amongst Indian youth and higher purchasing power of the upper class in tier 2 and 3 cities, according to Assocham.
The size of modern retail in India is expected to double to Rs 171,800 crore (US$ 25.7 billion) from Rs 87,100 crore (US$ 13 billion) in three years driven by omni-channel retail.
The Indian retail trading has received Foreign Direct Investment (FDI) equity inflows totalling US$1.09 billion during April 2000–September 2017, according to the Department of Industrial Policies and Promotion (DIPP).