India most attractive country for retail expansion, according to study by AT Kearney

India displaced Russia to move from second place to first in the 2005 Global Retail Development Index released by AT Kearney in July 2005. The Index is a study of retail investment attractiveness among 30 emerging markets across the globe.

The country's retail market totaling $330 billion is vastly underserved and has grown by 10 per cent on average over the past five years. It is also one of the most fragmented retail markets in the world -- the combined market share of the top five retai lers totals less than two per cent.

India's ranking was driven by an improved investment climate due to the recent relaxation of direct ownership restrictions on foreign retailers, it said. The message for retailers on India is clear: move now or forego prime locations and market positions that will become saturated quickly.

A T Kearney anticipated that global retailers such as Wal-Mart, Carrefour, Tesco and Casino would take advantage of the more favourable FDI rules and enter India through partnerships with local retailers.

Other retailers such as Marks & Spencer and Benetton Group, who are currently operating through a franchise model, will most likely switch to a hybrid ownership structure

..... AT Kearney's 2004 Global Retail Development Index