India is poised to witness the fastest growth in ultra-high-net-worth individuals (UHNWIs) globally, with their numbers expected to increase by 50% between 2023 and 2028. According to a report by McKinsey & Company and The Business of Fashion (BoF), this surge will fuel a major expansion in India’s luxury market, projected to grow 15–20% in 2025.
Key Drivers Behind India’s Luxury Boom
- Demographic Shifts: Rising incomes and a growing affluent class are accelerating luxury consumption.
- Expanding Retail Infrastructure: High-end malls like Mumbai’s Jio World Plaza and Galeries Lafayette are boosting luxury retail space in major cities.
- Government Policy Changes: Increased import taxes on luxury goods above ₹7,00,000 ($8,400) may shift spending from overseas to domestic markets.
- India’s Economic Ascent: India recently overtook Japan to become the world’s fourth-largest economy, reinforcing its position as a global luxury hub.
Global Comparison and Market Trends
While India’s UHNWI population is set to grow by 50%, Japan—the second-largest UHNWI market in Asia—is expected to see a 12% rise over the same period. However, China’s luxury sector, which grew 18% annually from 2019 to 2023, is now facing macroeconomic headwinds, impacting global luxury trends.
Future Outlook
India’s luxury retail expansion, coupled with strong domestic demand, positions the country as a key player in the global high-end market. As brands adapt to shifting consumer preferences, India’s ultra-rich class will continue to shape the future of luxury spending.
For more updates on India’s luxury market and economic trends, stay tuned!
