India’s retail market set to cross ₹190 lakh cr by 2034: Study

India’s retail market is poised to cross ₹190 lakh crore by 2034, according to the report titled "Winning in Bharat and India: The Retail Kaleidoscope". Online penetration has jumped to 50% in 2024, up from just 18% in 2019, whereas over 58% of purchases are still happening completely offline.

“Purchase pathways account for 26% purely online, 58% purely offline and 16% mixed. Mixed pathways include research offline,  purchase online or research online, purchase offline,” the report stated.

The report, jointly developed by Boston Consulting Group (BCG) and the Retailers Association of India (RAI) delves into India's consumption-driven growth.

“In the next decade, the Indian retail market will continue to grow at ~9%  annually, to exceed ₹190 lakh crore by 2034,” the report shared.

The retail surge is expected to maintain its rising trend, driven by higher spending capacity, supply side investments and strategic regulatory actions such as taxes and incentives. Education and workforce participation have contributed as a major factor that triggered a ‘Higher Spending.’ 

“One of the major findings of this year’s report is how successful retailers have deliberately chosen the consumer segments to prioritise. Some excel by championing efficiency and value in mass grocery or fast fashion, whereas others command premium segments through exclusive assortments, superior in-store experiences, and advanced digital tools. In all cases, a well-aligned operating model—covering merchandise, pricing, in-store and omni-experience, network, and promotion—is crucial to delivering on the chosen customer value proposition,” the report stated.

Worker population ratio (WPR) for Age 15 and above has grown 1% in men from 69% in 2017-18 to 74% in 2023-24, while WPR for women has grown 10%, from 19% in 2017-18 to 34% during the same period. WPR is described as the proportion of a country’s employed population.

Speaking on the complexity of the Indian retail market, P. Venkatesalu CEO and MD–Trent Ltd. said, “There is a certain level of complexity in the Indian retail market, players that have remained very clear and disciplined with their choices and have been able to execute at scale have registered relatively better outcomes. Very sharp choices, made in one’s context, are possibly key to success.”

When it comes to better products, global products are the preferred choice for 48%, whereas 70% prefer homegrown produced food. Meanwhile, 45% choose to purchase from Indian brands in categories like personal care and clothing and 26% think imported products are not made to suit the local lifestyle.

Since 2016, India has witnessed a homegrown revolution, with over 600 DTC brands emerging to meet consumers’ unmet needs.