India’s retail market is projected to more than double to Rs 210–215 trillion by 2035 from its current size of around Rs 90–95 trillion in 2025, as per a recent report by Boston Consulting Group (BCG) and the Retailers Association of India (RAI). The report, presented at the Retail Leadership Summit 2026 in Mumbai, emphasizes the significant role of technology, particularly artificial intelligence (AI), in driving future retail growth. It analyzes the changing dynamics of the Indian retail sector, evolving consumer preferences, and the strategic decisions retailers need to make to stay competitive.
The report underscores India’s robust economic growth, with a GDP expansion of 8% in 2025, fueled by strong private consumption, especially in discretionary and services spending. It predicts that India is on course to become the world’s third-largest economy by 2030, offering substantial opportunities for retailers in the coming years. AI is identified as a key enabler not only in enhancing customer experiences but also in transforming essential retail functions like merchandising, supply chain management, marketing, and customer service.
According to the study, a comprehensive AI-driven transformation could lead to performance improvements ranging from 40% to 60%, significantly higher than the 10% to 15% gains from isolated AI applications. However, the report highlights that the majority of AI’s value creation stems from internal capabilities, process enhancements, and effective change management rather than technology itself. Abheek Singhi from BCG anticipates the retail sector in India to evolve into a nearly Rs 200 trillion opportunity in the next decade, while Bharat Mimani, also from BCG, emphasizes the pivotal role of AI as a core driver of competitive advantage in retail.
Kumar Rajagopalan, the CEO of RAI, stresses that the projected Rs 200 trillion opportunity in the next decade will not be solely achieved through sales growth. He advocates for the integration of AI across the entire shopping experience, the restructuring of talent and operational frameworks, and the adoption of transformation as an ongoing process rather than a one-time initiative.
