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India's middle class fuelling boom in retail industry
By agencies
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Thursday, 09 June 2005, 19:30 IST
NEW DELHI:India's policies of market liberalization, coupled with an emerging middle class, have been credited as the main reasons the country's economy rose over the past few years.
And it is this group of middle class Indians, willing to spend like never before, that is said to be fuelling a retail industry boom. Bliss, as far as the Indian middle class is concerned, can be bought.
A new generation of consumers has emerged, and they are fervently treating themselves to an extravaganza called good living.
Easy bank loans and the like are propping them up further.
D H Pai Panandikar, Economic Analyst, said, "If you look at the kind of growth that has taken place in the industries, in consumer durables, the growth rate is something like 11 to 12 percent in the recent past. And if you look at growth rate in cars, in passenger vehicles, the growth rate is something like 30 percent. Likewise if you see the air traffic, the civil aviation has expanded very fast, not so much the railway traffic. So there is a shift from essentials, to what we may call luxury goods."
Their sheer buying power spells a boom for the retail sector.
Analysts say that from the present $180 billion and growing at 30 percent a year, retail trade is expected to be worth $270 billion and create more than 1 million jobs by 2010.
Growth rate is in top gear in specialty sectors like clothing, consumer durables, books and music, and luxury items.
And all of these together promises to leave the much-spoken-about Indian IT and IT-enabled services sectors far behind.