New Delhi [India], November 17 (ANI): India will be a focus for high street fashion brands, as the players will look to Asian growth markets such as India for manufacturing, said McKinsey & Company in its latest report.
The global consultancy firm said in the report that China’s economic deceleration, changing consumer preferences and the return of international travel are making growth in the country highly challenging, leading international fashion brands to look to other Asian markets.
The firm further added that the global fashion executives rank Asia growth markets as their top sourcing hotspots for the next five years, adding that the regulatory incentives in these countries fuel manufacturer capability building.
“India is expected to play a more prominent role,” added the global consulting firm, highlighting that the country is set to take on a bigger role in the global apparel market.
It further added, “India’s strong growth is rendering it a key global fashion market, particularly in the mid-market segment, which is expected to grow around 12 to 17 percent in 2025 compared to the projected low single-digit growth of the global fashion market.”
Going further, the report mentions that although India recorded the highest percentage of apparel quality failures in 2023, these issues may soon improve.
“The Indian government has invested around USD 2.5 billion in production-linked incentives and reforms to quality control orders, while foreign investment has increased 3x since 2019,” the report added.
Highlighting the opportunity, the report adds that the Indian economy, which is expected to become the fourth-largest economy in 2025, growing at 7 percent year on year, puts it to become the world’s third-largest consumer market by 2027.
Going further, the report adds that the growth of the non-luxury segment will be fueled by the middle class and digitization.
“There are 430 million people in India’s middle class–greater than the middle classes of the US and Western Europe combined. It is expected to reach 1 billion by 2050, largely from tier-two and -three cities,” it adds.
“Indian fashion customers are increasingly trend-focused. Digitization is accelerating this shift, as is the large share of young consumers in the country. People under the age of 35 make up 66 percent of India’s population, amounting to over 808 million people,” the report further adds.
The report added highlighting the opportunity in the luxury segment that India’s population of ultra-high-net-worth individuals (UHNWI), with over USD 30 million in assets, is expected to grow 50 percent from 2023 to 2028, making it the fastest-growing UHNWI population in the world.
“Aspirational customers, who make up about half of global luxury sales, are expected to grow from 60 million in 2023 to 100 million in 2027,” it added.
Among other prominant markets, the report also mentions potential in Japan and other emerging Asian markets. (ANI)
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