India, like many other countries, has seen a major shift in its economy in the 21st century. The world economy is changing rapidly, and India is increasingly becoming a major contributor to that. Be it our rising population of affluent youth or our global connections in the corporate world, there is more money being poured into Indian infrastructure than ever. This has significantly impacted consumerism in the country.
For a large part of India’s independence, citizens relied on buying and using stuff that was only essential to them. From getting a roof over the head, i.e., a house, to getting a meal three times a day for one’s family, to clothes, and traveling for work, were the primary expenses for most middle-class Indians for many years since Independence.
As time passed, the country kept developing into a major economic and world power. Today, it stands as the fifth-largest economy in the world. Therefore, with such a stratospheric rise in India’s economy and Indians’ finances, there had to be a significant change in our buying preferences as well.
As of 2025, India has a large number of affluent people who live and work in the country. The number of millionaires in India will also likely increase by 105% by 2026. Most of them come from middle-class families. Their preference for clothing, shopping, jewelry, and other accessories is geared more towards luxury products and services.
It is simply because they can afford it without making any compromises in other necessary items. The newer generation also has a huge role to play in this shift towards luxury shopping.
The current generation, Gen Z, and their previous one, Millennials, are very different in their approach and outlook from Generation X before them. Younger people from these generations do not necessarily believe in conservatism, as their previous generations used to believe. They are more likely to live in the moment, treat themselves fairly, and enjoy to the fullest with the money they earn.
Plenty of them live by this phenomenon called the YOLO trend. Stands for ‘You Only Live Once,’ this new approach to living life allows Gen Z and millennials to indulge in something called ‘Experimental Luxury’. The idea is that since they live only once, they buy whatever they fancy at the moment without worrying about saving. They are traveling to out-of-the-box destinations and eating in restaurants well out of their reach.
This behavioural trend automatically creates a larger sale and consumption of luxury products. Since the majority of the consumer population in India today is either a millennial or a Gen Z, their shopping preferences are usually geared towards luxury products.
All of these factors had a combined effect on the luxury market and created a huge boom in the industry. Until last year, i.e., 2024, the luxury goods market in India was valued at $17.67 billion. While that in itself is a giant number, it will likely grow five to six times more in the next half-decade and reach around $85-90 billion by 2029-2030.
The major reason behind this growth in the luxury market in India is attributed to the rise in affluent people, the buying and consumption preference of Gen Z and millennials, and the overall rise in the Indian economy.
As foreign luxury brands started seeing this definitive shift in buying preferences among Indians, more and more of them started investing heavily in India. There was a Christian Dior runway show at the iconic Gateway of India in Mumbai last year, there was a Vivienne Westwood fashion show in Mumbai, and there was the huge Anant Ambani and Radhika Merchant wedding, which had a ton of VIP guests from Hollywood.
Besides the wedding itself, it was a grand opportunity to display India’s wealth to the world. It displayed India’s soft power and opened up the nation to a host of foreign brands that would not have invested in the country otherwise.
Many luxury brands are now bullish on India as a market and are willing to invest more. Estee Lauder saw a two-times growth in India in the last two years, Apple hit a record high sales in iPhones in India, and Aditya Birla Fashion Retail has announced a partnership with French luxury departmental store Galeries Lafayette. With this partnership, flagship stores in Mumbai and Delhi will house over 200 luxury brands.
Reliance Industries has partnered with Valentino and Balenciaga to bring them to India. Many more such developments are happening in the world of luxury and fashion concerning India. Hence, as a luxury manager and enthusiast, these are exciting times to live, consume, and invest in India.
Digitalization, the rise of online media, and the use of AI more recently have also spearheaded the growth of the luxury market to an unprecedented extent. Post COVID-19, as the world went into lockdown, online services and applications became the sole mode of communication and operations.
It became easier for people to sit at home and buy stuff. While it existed pre-pandemic as well, the pandemic more or less forced people to rely upon it. Since the opulence and wealth weren’t a problem anyway, people started buying more luxury products online.
Brands such as Tata CliQ also doubled down on this opportunity and started providing more online services and benefits. Along with that, the use of social media and the reliance on social media for marketing, consumption, and promotion have also given the luxury market a breathing space to develop. It helped it penetrate middle-class markets where it previously couldn’t penetrate. Overall, the shift to the online world helped the luxury market grow in India.
As one thing led to another, India now produces more entrepreneurs, more HNI (High Net Income), and UHNI (Ultra High Net Income) employees, and it allows for a greater penetration of the e-commerce market. Luxury Real Estate, Luxury Cars, and Luxury Brands are some of the largest luxury industries where Indians are splurging their money. All of these factors are additive and have significantly boosted the luxury market in India.
