India- The Top Retail Destination

 The retail market in India has undergone a major transformation and has witnessed tremendous growth in the last 10 years

  • Indian retail market is expected to reach $1.1 Tn by 2027 and $2 Tn by 2032 growing at 25% CAGR
  • India currently has the 4th Largest retail market in the world

India ranks among the best countries to invest in the retail space. Factors that make India so attractive include having the second largest population in the world, a rising middle-income class of ~158 households, increasing urbanization, connected rural consumers and increased discretionary spending amongst consumers.

  • India ranked No. 1 in Global Retail Development Index (GRDI) in 2023
  • The retail sector in India accounts for over 10% of the country’s GDP and around 8% of the workforce (35+ Mn). It is expected to create 25 Mn new jobs by 2030
  • Increasing demand for organized retail space has helped create a capacity of ~120 Mn square feet (MSF) in retail space across major Indian cities. Major Indian cities include Delhi (23.7 MSF) and Mumbai (16.7 MSF)
  • Food & Grocery, Apparel & footwear, and consumer electronics are the largest retail segments, constituting 63%, 9% and 7% respectively of the retail market
  • The E-Commerce market is projected to grow at 18% annually through 2025 and is expected to touch $350 Bn in GMV by 2030
  • Luxury retail market in India is valued at $30 Bn and is steadily growing owing to rising disposable income and increasing investment by foreign brands
  • India’s digital economy is expected to reach $1 Tn by 2030
  • UPI accounts for a significant portion of all digital payments, accounting ~14 Bn transactions valuing  INR 20.44 Lakh Cr in May 2024 alone
  • Digital payments gross transaction value ($T) is expected to grow from $0.6 Tn (2022) to $3.1 Tn (2030)

Recent policy changes allow 100% FDI under the automatic route for single-brand retail trading and allow such entities to commence e-commerce operations prior to starting brick & mortar retail, provided they do so within 2 years of the start of online retail.

For further details, please refer FDI Policy

  • %

    Contribution to India's GDP

  • %

    Share in India's employment

  • %

    Growth rate of retail sector over 2022-32

  • %

    Share of Organised retail of total retail market

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India is the 5th largest global destination in terms of retail space

India is currently the 2nd largest internet market with 830 Mn users on a path to become a $1 Tn internet economy by 2030

Growth in income will transform India from a bottom of the pyramid economy to a truly middle-class led one, with consumer spending growing from $1.5 Tn today to nearly $6 Tn by 2030.

Industry Scenario

The Indian e-commerce industry is expected to cross the $350 Bn in GMV by 2030.

Indian retail market is estimated to reach $2 Tn by 2032, driven by socio-demographic and economic factors such as urbanization, income growth and rise in nuclear families. On the other hand, the Indian e-commerce industry is expected to cross $350 Bn mark by 2030, growing at a CAGR of 23%. 

The Indian e-commerce market was estimated to be worth over $55 Bn in Gross Merchandise Value in 2021. E-commerce and consumer internet companies raised $15.4 Bn in PE/VC funding in 2022, almost twice the amount raised in 2020 of ~$8.2 Bn. India will become the 3rd largest online retail market by 2030 and is expected to have about 6 Mn MSME merchants by 2027. 

The Indian retail market is largely unorganized. However, over the next 3-5 years, share of modern retail (including e-commerce) will increase to 30-35% with share of traditional retail coming down to 65-70%.


  • Growing income

    By 2030 India will add 140 Mn middle-income and 21 Mn high-income households – Leading to a huge emerging middle class.

  • Increased online spending

    Online shoppers in India are expected to reach ~500 Mn in 2030, more than 2x increase from 220 Mn users in 2022.

  • Growth of rural consumption

    Rural per capita consumption will grow 4.3 times by 2030, compared to 3.5 times in urban areas

  • Young millennial households

    By 2030, India will add nearly 90 Mn new households headed by millennials, who were born into liberalized India.


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Asked Questions

Is FDI allowed under Multi-Brand Retail in India?

As per the FDI Policy, foreign direct investment is allowed under Multi-Brand Retail Trading upto 51% through the government approval route.

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Are there any laws protecting consumer interests on online retail transactions?

The government notified the Consumer Protection (E-Commerce ) Rules, 2020 in July 2020, with the aim of protecting consumer interests, as well as outlining duties of the sellers and e-commerce entities.

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Can an SBRT entity commence e-commerce operations?

Subject to the conditions of SBRT under the FDI policy (link:), a single brand retail trading entity operating through brick and mortar stores, is permitted to undertake retail trading through e- commerce. Further, as per policy, retail trading through e-commerce can also be undertaken prior to opening of brick & mortar stores, subject to the condition that the entity open brick and mortar stores within 2 years from date of start of online retail

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Are there any sub-condition to Multi-Brand Retail Trade (MBRT) under the FDI Policy?

The FDI Policy specifies few sub-conditions that must be met by entity undertaking Multi Brand Retail Trade:

  1. Fresh agricultural produce, including fruits, vegetables, flowers, grains, pulses, fresh poultry, fishery and meat products, may be unbranded.
  2. Minimum amount to be brought in, as FDI, by the foreign investor, would be US $ 100 million.
  3. At least 50% of total FDI brought in the first tranche of US $ 100 million, shall be invested in 'back-­‐end infrastructure' within three years, where ‘back-­‐end infrastructure’ will include capital expenditure on all activities, excluding that on front-­‐end units
  4. At least 30% of the value of procurement of manufactured/processed products purchased shall be sourced from Indian micro, small and medium industries, which have a total investment in plant & machinery not exceeding US $ 2.00 million.

For more information, please refer to the FDI Policy

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What is the Consumer Protection Act, 2019?

Consumer Protection Act, 2019 is an Act instituted by the Government which covered consumer rights under the following areas:  

  1. Right to Safety 
  2. Right to be Informed 
  3. Right to Choose 
  4. Right to be heard 
  5. Right to seek Redressal 
  6. Right to Consumer Awareness

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