Indian consumers are forming one of the most fascinating growth stories in Asia, with low penetration of branded consumer goods and rising incomes creating an exciting business and investment opportunity. Only a minority of Indians purchase branded consumer packaged goods and the number of Indian households earning at least INR 240,000 (USD 3,500) is predicted to rise to more than 60 million by 2020, from 33 million households in 2015, under normal economic growth conditions. The topline story and our in-country channel checks have renewed our conviction that it is a great time for new brands and consumer categories in India.
India boasts preferential demographics with hundreds of millions of young and educated workers. These youth may have small wallets but they have huge aspirations with their own preferences and tastes. The country's rural population is becoming part of the growth story rather than holding back the country’s progress. While rural consumption has not always been smooth, the Indian government remains focused on productivity improvements such as country-wide unique identification, village electrification, bank penetration, and digitizing land records. India's biggest challenge is to create nearly 10 million jobs a year to keep its young people employed. Monetary easing, government expenditures, falling inflation, and increasing foreign direct investment are supportive, yet much more remains to be done for sustained economic growth over the next 5-7 years.