India set to be 3rd largest consumer mkt by 2026

India's private consumption has almost doubled to USD 2.1 trillion in 2024 from USD 1 trillion in 2013, growing at 7.2% CAGR, faster than the US, China and Germany, according to a report.

On course to become the world's third-largest consumer market by 2026, India is well-positioned to reap the benefits of a demographic dividend, said the report titled 'India's changing discretionary spending: Key insights for brands' launched by Deloitte India with Retailers Association of India on Thursday.

"Surpassing Germany, India's private consumption has almost doubled to USD 2.1 trillion in 2024 from USD 1 trillion in 2013, and during 2013-23, India's consumption grew at 7.2% CAGR, faster than China, the US and Germany," it said. By 2030, the report said, "The number of Indians earning over USD 10,000 annually is expected to nearly triple, increasing from 60 million in 2024 to 165 million. This reflects the significant growth of the country's middle class and a fundamental shift towards discretionary spending." 

It pointed out that several key forces are driving the consumption boom, including premiumisation and evolving consumer preferences, as with rising affluence, consumers are prioritising quality, convenience and experiences over price. Gen Z and millennials, who account for 52% of the population, are driving this shift and the demand for premium brands, sustainable products, and personalised experiences.

"India's consumer landscape is undergoing a fundamental transformation. The surge in discretionary spending, expanding digital commerce and increasing access to credit are redefining the rules of engagement for brands," Deloitte India Partner and Consumer Industry Leader  Anand Ramanathan said. By 2030, he said, "India's per capita income is expected to exceed USD 4,000, unlocking new opportunities across sectors.