China, India consumer spending to triple by 2020: study

[JayAtl]

LONDON (Reuters) - Consumer spending in emerging market powerhouses China and India is expected to triple by 2020 to a combined $10 trillion a year, potentially helping to boost economic growth and corporate profits in the developed world, researchers said on Tuesday.

The study by Boston Consulting Group (BCG) is based on a survey of 24,000 consumers as well as interviews with business leaders. The business strategy consultancy predicts consumers in China and India will spend a combined total of $64 trillion on goods and services in the decade leading up to 2020.

Annual spending on consumer goods will be three times the level spent in 2010, according to "The $10 Trillion Prize: Captivating the Newly Affluent in China and India".
"We are at a turning point in history where relative wealth will shift from the West to China and India, but absolute wealth, including in the West, should increase," said Michael J. Silverstein, a senior partner at BCG and the book's co-author.

Some of the enthusiasm for India, China and other emerging markets has dimmed in recent months due to slowing economic growth, weak progress with structural reforms and political risks. Emerging equities have also not performed as well in recent years as their developed peers.
But the book's authors played down these worries, saying India and China were experiencing the inevitable volatility in emerging economies.

The middle class in the two countries is expected to reach 1 billion by 2020, BCG said, noting that in India, the proportion of middle-class people is expected to grow to 45 percent in 2020 from 28 percent in 2010.

BCG said Western companies need to win over the growing middle class of the two countries via long-term strategies adapted to the future spending habits of these new consumers.
It named Kraft, Yum! Brands, PepsiCo, Gucci, LVMH, BMW, and Pernod Ricard as companies that have deployed successful strategies in these countries

China, India consumer spending to triple by 2020: study - Yahoo! News

 

[JayAtl]

64 trillion on goods and services - phew.

 

[Jade]

64 trillion on goods and services - phew.

It seems it is a cumulative figure

 

[idune]

Why bundle india with Chinese consumer spending? Although this is just speculation what would be indian consumer spending alone?

 

[KRAIT]

Both China and India if work cooperatively, they can significantly boost their economies and India needs it more than China.

Such cooperation will also help in dialing down the intensity and decreasing the frequency of disputes.

Its about time, China and India make an economic zone. Russia which is also emerging faster will be another welcome addition.

 

[agamdilawari]

Why bundle india with Chinese consumer spending? Although this is just speculation what would be indian consumer spending alone?

Tujhko mirchi lagi to main kya karun

 

[KRAIT]

Why bundle india with Chinese consumer spending? Although this is just speculation what would be indian consumer spending alone?

Buddy, I think you should look at various well known brands coming to India to tap this emerging market.

Same is happening in Brazil. The telecom giant there is trying to add medical services to bring more people in total market potential.

Indian and Chinese population distribution income wise if looked, you will see huge segment of population ripe for these companies. 650 million middle class Indian is something that no MNC would let its competitor to take.

 

[ahfatzia]

The latest figure I can find is 09' figure. Anyone?


China 09' $1,835 billion this year (my guess) $ 3,000 b

India 09' $ 738 billion $ 1,500 b

combine $ 4,500 billions


Conclusion: No doubt $10 trillions is achievable and my guess is it'll surpass that number

List of largest consumer markets - Wikipedia, the free encyclopedia

 

[Chinese-Dragon]

Indian and Chinese population distribution income wise if looked, you will see huge segment of population ripe for these companies. 650 million middle class Indian is something that no MNC would let its competitor to take.

Why let MNC's take such a large consumer base?

Domestic markets should be dominated by Domestic companies. MNC's can have a minority market share, if they are competitive enough to keep it.

 

[IndoUS]

Surprisingly this news comes out after the reform talk. India should make sure to make it so that these big companies have to source product, materials from India for doing business. Specially in case of food the home grown crops to be given priority.

 

[dollarman]

Why bundle india with Chinese consumer spending? Although this is just speculation what would be indian consumer spending alone?

I don't know. Maybe ask BBC economists who wrote the article...

 

[ChinaToday]

I don't know. Maybe ask BBC economists who wrote the article...

They were paid by india government to write this bs

 

[KRAIT]

Why let MNC's take such a large consumer base?

Domestic markets should be dominated by Domestic companies. MNC's can have a minority market share.

Agreed. But by increasing competition and implementing policies to cap these MNCs which is the optimal way, not only improve quality of domestic industry but also helps in bringing FDI. Also the employee opting from MNC to domestic adds up in R&D of domestic industry.

Boost domestic industry but not on expense of keeping them away, they will move to some other country and it will not only be economical loss but also knowledge, know-how loss too.

I am not counting employment, better choices for consumer, shift in Service based economy of India etc. in this argument.

There are multiple reasons. You are right at not letting them significant portion but 30% of 650 million is still a huge number even if we reserve 70% to domestic ones.

The luxury industry such as luxury automobiles and other products which can only be afforded by the higher income segment of India, which is still huge, can be given major portion to these MNCs.

 

[ChinaToday]

Why bundle india with Chinese consumer spending? Although this is just speculation what would be indian consumer spending alone?

Exactly india consumer spending is peanut compared to china

 

[ChinaToday]

Both China and India if work cooperatively, they can significantly boost their economies and India needs it more than China.

Such cooperation will also help in dialing down the intensity and decreasing the frequency of disputes.

Its about time, China and India make an economic zone. Russia which is also emerging faster will be another welcome addition.

Cooperation with india? you must be joking right, your media and your millitary called us your enermy number1 ring the bell?