India’s retail sector entered the festive season with renewed energy, as lower GST rates coincided with Navratri to deliver a strong start to sales. From cars and electronics to footwear and FMCG staples, shoppers returned in force, reviving consumer sentiment. The government’s GST 2.0 reforms are expected to bring relief across households, with grocery bills likely to fall by 13% and small car buyers saving up to ₹70,000. Businesses have also been granted permission to continue using old packaging until March 2026, easing compliance challenges.
At the same time, the changing preferences of Gen Z and Millennials – with a spending power of $250 billion – are reshaping retail leasing towards lifestyle-led formats, particularly apparel and F&B. Health products, once niche, are now mainstream, with the segment valued at over ₹63,000 crore and growing at double-digit rates. Together, these trends highlight how affordability, experience, and wellbeing are defining India’s retail future.
Click on the headings below for insights on how these trends are shaping India’s retail landscape…
1. Lower GST & Navratri give mega start to festive sales
The 'first day first show' in the new GST regime saw a strong opening and footfalls didn't disappoint, along with deliveries and bookings. As lower GST on a host of consumer products such as cars, two-wheelers, TVs, ACs, FMCG food products, budget footwear and clothing, coincided with onset of Navratri, the buzz came back in markets pretty strongly.
2. Gen Z and Millennials’ $250 billion spending power redefining India’s retail leasing landscape
The preferences and buying power of Millennials and Gen Z consumers – pegged by Deloitte-FICCI at $250 billion in direct spending - is transforming India’s retail space from a shopping and transactional hub to an immersive, lifestyle-oriented experience. In top cities, the retail verticals capturing the lion’s share of leasing activity - apparel and F&B - accounted for 54 percent share, underscoring Gen Z’s appetite for fashion, gourmet, and lifestyle experiences.
3. As GST 2.0 debuts, PM Modi says reforms will bring relief for all
At IG Park in Itanagar, the PM acknowledged the sizeable presence of women in the gathering and said India’s “next-generation GST reforms” would bring significant relief to households by making kitchen supplies, educational materials, footwear and clothing more affordable. He iterated his commitment to boosting income and savings, reminding everyone that annual income up to Rs 12 lakh was now tax-free while GST had been pared to two slabs — 5% and 18% — with many items becoming tax-free.
4. New GST Rate: Manufacturers allowed to use old packaging until March 31, 2026
In a major relief to manufacturers, importers, and packers, the Ministry of Consumer Affairs has issued a fresh circular under the Legal Metrology (Packaged Commodities) Rules, 2011, allowing businesses to skip mandatory re-packaging, re-labelling, and re-stickering of unsold stock following recent GST rate cuts. The circular also extends the use of old packaging material until March 31, 2026, providing an additional three months beyond the earlier deadline.
5. From Niche to Necessity: Health products power Rs 63,000 crore FMCG market in India
Health has become an everyday choice for Indian consumers, with health-oriented food and beverage (F&B) products now representing Rs 63,093 crore in value, growing at a CAGR of 11.7% over the past four years, according to Worldpanel India’s Mainstreaming Health 2025 study. The research highlights that 87.9% of Indian households have purchased a health product in the past year, underscoring the fact that “health” is no longer niche- it has entered the mainstream.
The GST reforms, which kicked in from Monday (September 22, 2025), will lead to a saving of 13% in the household bills for groceries and daily essentials, while a small car buyer could save around ₹70,000. According to government estimates, stationery, clothing, footwear and medicines purchases would bring in savings in the range of 7-12%, while the savings would go up to 18% in the case of individual health and life insurance policies, which have been exempt from GST effective from Monday.
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