While American billionaires Warren Buffett and Bill Gates are in India trying to persuade the country’s rich to give their money away, another group of businessmen is here to get them to spend it on themselves. A team of Italian entrepreneurs who work in the luxury sector are in Mumbai for a two-day conference to talk luxury and business. It’s no big surprise that the luxury industry is eyeing markets like India. It’s estimated that in less than five years emerging markets will make up 50% of luxury sales globally.
The industry realized just how important these markets are during the global economic downturn–prompting commentators to say it was “saved by the BRICs,” referring to the top emerging markets of Brazil, Russia, India and China. For a country that boasts the world’s second-fastest growing major economy, India’s international luxury goods market is still surprisingly small. Here, it has failed to take off in the same way as in countries like China–where it has done spectacularly.
While China makes up an estimated 10% of the global luxury market, India accounts for less than 1%, or a market worth around $1.3 billion, according to data provided by Altagamma, which brought the delegation of businessmen to Mumbai. On the supply side, the gap between the two Asian giants is also vast: of the world’s leading 500 global luxury brands, only around 30% have an Indian presence, compared to China’s 70%, according to Altagamma.