India’s retail market is projected to expand to Rs. 210–215 trillion (US $ 2.31 trillion–US $ 2.36 trillion) by 2035, up from approximately Rs. 90–95 trillion (US $ 991 billion–US $ 1.04 trillion) in 2025, supported by annual GDP growth of 8% and sustained consumption, according to a joint report by Boston Consulting Group and the Retailers Association of India.
The report noted, however, that organised retailers are no longer significantly outpacing overall category growth, marking a departure from earlier years when formal retail chains consistently grew faster than the broader market. The narrowing growth differential, particularly in offline retail, signals intensifying competition and the need for more sharply defined strategies.
P Venkatesalu, Chief Executive of Trent, commenting on recent moderation in growth at Zudio, stated that linear growth should not be expected in real markets. He observed that markets typically experience peaks and troughs, and that brands must continually reinvent themselves to remain desirable to customers.
The report underscored that private consumption — led by discretionary and services spending — remains the principal growth driver and is expected to push the retail market close to the Rs. 200 trillion (US $ 2.20 trillion) mark over the coming decade. However, it highlighted a structural shift in demand patterns, with consumers becoming more selective and less predictable.
Purchasing decisions are increasingly influenced by context, including immediacy of need and convenience. Shoppers are comparing prices across channels and demanding improved service and personalisation. As a result, retailers can no longer rely solely on store expansion or discount-led strategies to drive growth.
The study recommended clearer strategic trade-offs, advising retailers to identify priority consumer segments and align pricing, assortment and experience accordingly, rather than attempting to cater to all segments simultaneously.
Technology, particularly artificial intelligence, is emerging as a transformative force. The report noted that AI is reshaping product discovery and purchasing behaviour through AI-guided recommendations and digital transactions. With India’s internet user base having more than tripled since 2016, AI-led commerce is expected to scale rapidly, especially in urban centres and among Gen Z consumers.
Abheek Singhi, Managing Director at Boston Consulting Group, stated that future market leaders would combine a sharply differentiated value proposition with large-scale adoption of AI and technology, alongside disciplined execution.
