India rises to the top spot in the Global Retail Development Index (GRDI)

AT Kearney - one of the world’s leading management consulting firms - introduced the Global Retail Development Index (GRDI) in 1995.

Since 2001, AT Kearney has released an annual study evaluating retail investment attractiveness across 30 emerging markets through the GRDI. The GRDI helps global retail corporations prioritize their international expansion strategies by assessing emerging markets based on 25 criteria, including economic and political risks, retail market attractiveness, market saturation levels, and the gap between GDP growth and retail growth. As of now, none of the top 10 retail markets in 1995 have retained their original rankings.

This year, India has been ranked the world’s most attractive retail market based on the GRDI, offering the highest investment potential for global retailers and food conglomerates seeking to expand internationally, such as Wal-Mart, Benetton, and Tesco.

India climbed from second to first place in the GRDI, replacing Russia, which had held the top position since 2003.

Experts attribute India’s advancement to a significantly improved investment environment, driven by the relaxation of direct ownership restrictions for foreign retailers.

India’s retail market is valued at USD 330 billion, with an average annual growth rate of 10% over the past five years. However, it still falls short of meeting the country’s consumer demand. India is also one of the most fragmented retail markets globally, with the combined market share of the top five retail chains accounting for less than 2% of the total.

Russia’s drop to second place in the GRDI may be due to the stagnant influx of foreign retailers in recent years. Although the Russian market remains attractive, increasing signs of saturation suggest that global retail groups should reconsider their market entry strategies for Russia.

Eastern Europe continues to represent the greatest investment opportunities for international retailers - 11 of the top 20 GRDI-ranked markets are located in this region.

Ukraine jumped from 8th to 3rd place, thanks to strong GDP and retail sales growth, along with a large urban population. Notably, Bosnia-Herzegovina and Macedonia entered the top 20 retail markets for the first time this year. Vietnam ranked 8th in the GRDI, maintaining its position among the world’s 10 fastest-growing retail markets.

However, this year Vietnam’s ranking dropped by one spot compared to the previous year.

(Source: VietNamNet)