The Bird of Gold': The Rise of India's Consumer Market, published by McKinsey & Company, May 2007, is now available. Free download, pdf format. 

If India continues on its current high growth path, incomes will almost triple over the next two decades, and the country will climb from its position as the twelfth-largest consumer market today to become the world's fifth-largest consumer market by 2025.

"The upcoming changes in the Indian consumer market will create major opportunities and challenges for Indian and multinational companies alike. Businesses that can meet the needs of India's aspiring middle class, keep price points low to reflect the realities of Indian incomes, build brand loyalty in new consumers, and adapt to a fast changing market environment will find substantial rewards in India's rapidly growing consumer market.  Likewise, India's policymakers will be challenged to keep India on the path of economic reform while addressing major challenges in infrastructure and social investment. The rewards, however, will be substantial progress in poverty reduction and a rising standard of living for much of India's population."

Chapter Summaries:

Chapter 1: Introduction
MGI describes its research approach, provides background on the Indian market, and discusses how that context informs the report's base-case scenario for future Indian growth—information which, in turn, drives the research projections of incomes and consumption.

Chapter 2: The Quadrupling of Indian Consumption, 2006–2025
The combination of more income per person, more people, and moderating savings will fuel a quadrupling of India's consumer market over the next two decades. This chapter offers a picture of the future development of the Indian consumer market in total.

Chapter 3: The Future Development of the Urban Market
In analyzing the trajectory of India's urban market, MGI forecasts urban consumption both to accelerate and to continue to grow faster than the overall economy, and estimates compound annual growth of 9.4 percent over the next 20 years.

Chapter 4: The Future Development of the Rural Market
An analysis of rural consumption shows that while its growth will continue to lag behind growth in wealthier urban areas, it will nonetheless accelerate from a compound annual rate of 3.9 percent during the past two decades to 5.1 percent during the next two.

Chapter 5: How Consumption Patterns Will Change
MGI uses an econometric model to estimate the future evolution of Indian consumption by income bracket across nine high-level and 30 more detailed product and service categories that cover 100 percent of Indian household consumption. Overall, Indian consumption patterns are already evolving rapidly and will continue to do so.

Chapter 6: Opportunities and Challenges
MGI explores the implications of India's emerging consumer market for businesses and policy makers.

Appendix A: Forecasts and Analyses by Consumption Category
This appendix offers more detailed analyses of future consumption trends in nine major product and service categories as well as 30 subcategories.

Appendix B: Detailed Description of the MGI Consumer Demand Model
This appendix provides an overview of our modeling approach and our data sources.

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The McKinsey Global Institute (MGI), founded in 1990, is McKinsey & Company's economics research arm. Its primary purpose is to undertake original research and develop substantive points of view on critical economic issues facing businesses and governments around the world. MGI's research is funded by the partners of McKinsey and not commissioned by any business, government, or other institution.

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