India retail market set to reach $2 trillion in next decade: Report

India continues to be a bright spot among the major economies and the retail market is expected to reach $2 trillion in the next 10 years, presenting a large opportunity for retailers, a new report showed on Wednesday. India is the fastest-growing country among the top five global economies and is expected to become the third largest by GDP in 2030. According to the report by the Boston Consulting Group (BCG) and the Retailers Association of India (RAI), the retail market growth is expected to continue at 9-10 per cent.

"The Indian retail sector will more than double in size to $2 trillion in the next decade across categories and formats, and the successful retailers are the ones who continue to challenge the perceived growth profitability trade off," said Abheek Singhi, Managing Director and Senior Partner at BCG. Store expansions continue to happen and with increasing urbanisation, there is more consumption expected to happen in tier 1 to 4 cities. "While e-commerce continues to grow, net new user addition has seen a slower pace in the year and the role and proposition of online needs to be re-imagined," the report mentioned.

Organised retailers need to sustain performance and continue to grow shares. "Retail is going through key shifts impacting the pace and shape of growth," the findings showed. "Income growth remains steady, and consumers are optimistic on their personal income outlook. At the same time, consumers increasingly look to spend on 'experiences' or save more through newer/nascent vehicles."

According to Kumar Rajagopalan, CEO, of RAI, by focusing on personalised customer experiences, exploring new collaborations, and leveraging AI for efficiency, "we can propel India's retail industry towards unprecedented growth and global competitiveness".