India To Surpass China To Become The World Largest International Market

India is poised to become the world's largest international market in 2023, surpassing China, according to a statement made by Walmart's Chief Financial Officer, Brett Biggs. This is due to several factors, including a growing middle class, increasing internet and smartphone penetration, and the government's push toward digitalization.

Foreign Direct Investment (FDI) in India has played a significant role in India's growth story over the past few decades, and the country has witnessed a steady increase in FDI inflows in recent years. 

India's e-commerce market has seen significant growth in recent years, with companies such as Amazon, Walmart-owned Flipkart, and Reliance Retail's JioMart expanding their operations in the country. The COVID-19 pandemic has also accelerated the shift toward online shopping, with consumers increasingly turning to e-commerce platforms to purchase essential goods and services.

In addition to the growth of the e-commerce sector, India's retail industry is also experiencing a transformation. The government has implemented several initiatives, such as the National Retail Policy and the Single Brand Retail Trade Policy, to attract foreign investment and promote domestic manufacturing. This has led to increased interest from international retailers, such as Walmart, who see India as a lucrative market.

India's demographic advantage, with a large and young population, also contributes to its potential as a major market. The country's middle class is expected to continue growing, with estimates suggesting that it could reach 547 million people by 2025, up from 267 million in 2016. This represents a significant opportunity for retailers, who are looking to tap into the growing consumer base.

The government's push towards digitalization, including initiatives such as Digital India and the Unified Payments Interface (UPI), has also played a role in India's rise as a major market. These initiatives have helped to increase internet and smartphone penetration, making it easier for consumers to access e-commerce platforms and conduct online transactions. This has also attracted significant investment from global players. For example, Amazon and Walmart have invested heavily in India's e-commerce sector, while Google and Facebook have invested in the country's digital payments ecosystem.

The government has also taken steps to improve the ease of doing business in India, such as simplifying tax procedures, reducing red tape, and improving infrastructure. India has climbed the World Bank's Ease of Doing Business rankings from 142 in 2014 to 63 in 2019, and the government aims to break into the top 50 in the next few years.

In conclusion, India's potential as a major market is undeniable. With a growing middle class, increasing internet and smartphone penetration, and the government's push toward digitalization, the country is set to become the world's largest international market in 2023. Retailers and e-commerce companies must continue to adapt to the changing market conditions and take advantage of the opportunities presented by India's transformation.

Fox&Angel is an open strategy consulting ecosystem, put together by a top-line core team of industry experts, studded with illustrious success stories, learnings, and growth. Committed to curate bespoke business & strategy solutions for each of your challenges, we literally handpick consultants from across the globe and industries who fit the role best and help you on your path to success.