Indians spend big despite economic slowdown and inflation worries
It's economic gloom all around the world but in India. It seems that Indian consumers are unaffected by global economic slowdown or inflation. That's what the festive season does to you here. According to early data, from the beginning of last month, Indians have shown no remorse in spending on everything from cars and jewelry to travel and houses.
Why does this story matter?
The pandemic forced Indians to lay low during the last two festive seasons. The current one is showing a complete about-turn. People have decided to let themselves loose after being confined to their homes for several months. The figures tell us that nothing is going to stop them from doing so. Even the economical downturn that we see all around the world.
Estimated sales will be twice as pre-COVID numbers
The sales (online and offline) during the festive season that starts in the last week of September and lasts till early November are expected to cross $27 billion. This is 25% higher than last year and is almost double the pre-COVID figure in 2019. Out of the $27 billion, offline sales will contribute $15.2 billion, while $11.8 billion will be from online platforms.
Receding COVID has unleashed the consumers' pent-up demand
It's not unusual for retail sales to peak during October-November when Dussehra and Diwali are celebrated. Even so, the estimated numbers this year are quite extraordinary. This is attributed to receding COVID. After two years of pent-up demand, the festive season is being seen as a good time to unleash the hunger to spend big.
Sales through online platforms have skyrocketed
The increase in online sales is another reason behind the significant rise in festive spending. In the first week, there was a one-fifth increase in online sales. Since 2018, there has been a four-fold rise in online buyers. Add to that the increase in demand for smartphones and clothing items, we get a big figure from online platforms.
Global economy is in tatters due to several reasons
The spending boom in India is despite the glum surrounding the global economy elsewhere. High interest rates, fast-rising inflation, and supply chain issues forced by the Ukraine-Russia war have the world economy in tatters. We have seen the effects of this in India as well. IMF predicts most big economies to be in recession next year. But that hasn't stopped the festive spending spree.
