Indian retail market set to reach Rs 190 lakh crore by 2034 as consumption surges

Mumbai, Feb 27: India, the fastest-growing major economy, is set to become the third-largest by GDP by 2030, driving a Rs 190 lakh crore retail market by 2034, according to a report released on Thursday. Consumption in the country has been expanding at a pace ahead of other large economies.

The Indian retail market is growing and this expansion has outpaced overall consumption, highlighting the sector’s resilience and strong momentum, according to the report by Boston Consulting Group (BCG) and the Retailers Association of India (RAI). India’s retail market has grown from Rs 35 lakh crore to Rs 82 lakh crore in the last decade, witnessing a 9 per cent growth. “It is expected to be Rs 200 lakh crore in the next decade and will offer diverse opportunities which are all at scale and need very different operating models to deliver a winning proposition.

There is an opportunity for multiple trillion-rupee turnover retailers by 2035,” BCG Managing Director and Senior Partner, Abheek Singhi, said. Affluent households are projected to triple by 2030, creating significant opportunities in premium and luxury retail, while the mass segment remains a dominant consumer base. Despite occasional periods of sharp volatility, the overall growth trajectory remains strong, with organised retail consistently outpacing the broader market, said the report. Women’s workforce participation has doubled in the past 5 years, closing the gap with men, and this has driven growth in women-centric categories such as beauty, personal care, and fashion. Gen Z and millennials form large consumer cohorts, necessitating alignment with their values and digital-first habits. Meanwhile, over the next decade, the 45+ age group will become the largest cohort leading to new consumer demands emerging, including preventive consumer health, said the report.

Despite rapid e-commerce growth, with online shopping penetration reaching 50 per cent, 58 per cent of purchase pathways remain purely offline. Consumers navigate between global aspirations and local pride, necessitating a harmonised approach that blends international trends with culturally relevant offerings. Indian retailers have successfully navigated a rapidly evolving market by making strategic choices that align with both demographic shifts and changing consumer behaviours, said the report.