India to enter top 10 global duty-free markets by 2025
The duty-free market in India has been estimated to grow the fastest over the next couple years and is estimated to break into the global duty-free market as well.
- Indian duty-free market to grow at 20% CAGR.
- The retail market in India was been valued at $641 billion in 2016.
- Increase in the foreign tourists is expected to give impetus to India's duty-free market.
While the global duty-free market is expected to grow at 10%, the Indian market will grow at a much more sweltering pace.
India will have broken into the top 10 global duty-free markets in another seven years, a report by RedSeer Research revealed on Tuesday.
“The global duty-free market is expected to grow at 10-11% year-on-year till 2025, with the Indian duty-free market leading the pack at 20% CAGR,” the report said.
The report cited two reasons for growth in India’s duty-free market.
- Increase in the foreign tourists in India.
- Increase in the purchasing power of Indians who are now finding better offers in the Indian airports and contributing majorly to the duty free-travel retail market in India.
Foreign tourist arrivals (FTAs) in India in the month of October year on year was 18.1%, as per the data given by Press Information Bureau of India.
Number of FTAs in October, 2017 was 8.76 lakh as compared to FTAs of 7.42 lakh in October, 2016 and 6.83 lakh in October, 2015.
Recently India moved up a notch to place 126th in the International Monetary Fund's (IMF) ranking of countries based on their GDP per capita.
The ranking of countries is based on purchasing power parity (PPP) of citizens. India's GDP per capita went up to $7,170 (Rs 4.66 lakh) in 2017 from $6,690 last year.
The retail market in India was been valued at $641 billion in 2016, as per IBEF data.
At the current compounded annual growth rate, India has been ranked as the fastest going. Japan ranked second and China ranked third, in the report.
Image Source: RedSeer Research
“We expect India (which is currently not even in the global top 25 duty free-travel retail markets) to enter the top 10 global duty-free markets by 2025,” the report said.