The Bird of Gold: The Rise of India’s Consumer Market - Mckinsey

Business standard published the excerpts of a report by mckinsey on Indian Consumer and it predicts a great future for indian consumers and an explosive growth in indian consumer’s spending..

Now, experts say golden bird will fly again. A report on the Indian consumer market, prepared by the McKinsey Global Institute, points to explosive growth in consumer spending in the next two decades, taking the market to a jaw-dropping Rs 69.5 lakh crore ($1.5 trillion), four times the present size of Rs 16.9 lakh crore.

Mckinsey predicts that by 2025, there will be 9.5 million households with greater than 10 lakhs in income, 128 million households with 2 to 10 laks in income and 93.1 million households with 1 to 2 laks in income. With growth primarily in communication ( 13.4%) , healthcare ( 15.9%) , education ( 11%) , transport (8.3%), personal products (9.2%), housing ( 6%), food (4.5%), apparel (6.5%) etc.

“If this does occur, India’s climb out of poverty will rank alongside China’s as one of the great achievements in economic history,” the report continues.

Defining the middle-class as those earning between Rs 2 lakh and Rs 5 lakh annually, the report forecasts a dramatic change in the size of this group: from 50 million people (5 per cent of population), the middle class will swell to an impossible-to-ignore 583 million (41 per cent) by 2025.

It isn’t about size alone: this group will control Rs 51.5 lakh crore by that time, an 11-fold increase; that’s 58 per cent of total income in the country. A number of these people will be “new-to-bracket” consumers, which means they will probably be aspirational and willing to try new products.