By BW CFO World Online Bureau
McKinsey report expects India to have third-largest number of high income households by 2030
India could have the third-largest number of high income households by 2030. The country will be just behind China and the United States in this feat. Mumbai is likely to have the fourth most high income households in Asia, by then. McKinsey Paper said Asian consumers will account for half of the global consumption growth in the next decade. This will be a $10 trillion opportunity, of which India will contribute $1.8 trillion. “Asian consumers continue to face challenges associated with the COVID19 pandemic, but are likely to contribute to half of all global consumption growth in the next decade,” said Mahima Chugh, a McKinsey partner in Mumbai. Factors that will influence this growth include the increasing number of high-income households, shrinking household size, the doubling of the consumer class, seniors going online and the rise of e-commerce in the country. The average household size in the country is decreasing, having witnessed a 16 per cent decline, from 5.5 persons in 1999 to 4.5 persons in 2015. Aside from that, up to 55 per cent of India’s population could belong to the consuming class by 2030. This would be a significant improvement from the current 24 per cent.
“Asia’s consumer story over the next ten years and beyond is not only about scale and growth, but about growing diversity in consumer markets (in a region that is already hugely diverse) and how consumers in the region are trailblazing new paths,” said Jonathan Woetzel, a McKinsey senior partner in Shanghai and a director of the McKinsey Global Institute. Likewise, with the increase of the number of seniors going online, their consumption may grow twice as fast as compared to the rest of the population. The report said that consumption by those above the age of 60 may grow up to 1.6 times faster than that of the rest of the Indian population. The growth of e-commerce is also going to contribute to this significantly.
Similarly, with more seniors going online, their consumption may grow twice as fast as consumption by the rest of the population. Consumption by seniors (aged 60 and over) may grow 1.6 times faster than that of the Indian population as a whole, said the report. New sales channels such as e-commerce which is expected to grow 25 per cent annually till 2025, is also expected to fuel India’s growth story.