New Delhi: India’s consumer spending on goods is projected to grow by 7% annually over the next five years, according to a recent report by S&P Global Market Intelligence.
The report highlights that consumer spending, currently valued at $1.29 trillion in 2024, is set to experience significant growth driven by various economic factors.
The forecast indicates that the growth rate, adjusted for inflation, has already seen an increase of 4.8% over the past five years. This upward trend is expected to accelerate, particularly in sectors such as apparel, household equipment, and transport equipment, which are projected to grow by 9.5%, 8.8%, and 8.5% respectively.
The report attributes this growth to India’s expanding middle class, rising disposable incomes, and increased urbanization. Additionally, government initiatives like production-linked incentives (PLI) and tariffs have bolstered the manufacturing sector, particularly in electronics and telecom equipment.
India’s strategic focus on becoming a manufacturing hub has also played a crucial role. The “in-market, for-market” approach has attracted significant investments, enhancing local production capabilities and boosting exports. For instance, the export of telecom equipment has seen an annual growth rate of 44% from 2015 to 2024.
The entry of India into JP Morgan’s Government Emerging Market Bond Index in 2024 is expected to further enhance government funding and unlock substantial resources in domestic capital markets. This move is anticipated to provide a stable economic environment conducive to sustained consumer spending growth.
