Sector snapshot
Consumption drives the Indian economy, and trading draws steady foreign capital. Private final consumption expenditure was 56.7% of GDP in FY2025-26 at current prices (MoSPI provisional estimates, 5 June 2026). Trading drew USD 4.0 bn of FDI equity in FY2025-26 and USD 51.6 bn since April 2000, the third-largest share of FDI equity over that period (DPIIT FDI Fact Sheet, March 2026).
| Indicator | Figure | Period and source |
|---|---|---|
| Private final consumption expenditure as a share of GDP | 56.7% | FY2025-26, current prices (MoSPI) |
| FDI equity into trading | USD 4.0 bn in the year; USD 51.6 bn since April 2000 | FY2025-26 (DPIIT) |
| Online retail market (approximate) | USD 80 bn, up 21% on the year | FY2025-26 estimate (IBEF) |
| E-commerce export target for 2030 | USD 200–300 bn | Invest India, retrieved 1 Oct 2026 |
Four things stand out:
- Consumers are the main demand engine. Private consumption is more than half of GDP. GST cuts from 22 September 2025 moved many everyday goods and most packaged foods to 5%.
- Online and quick commerce are scaling. India had 290–300 million online shoppers in 2025, the third-largest base after China and the US. Quick commerce was a USD 7–8 bn market in FY2024-25, projected at USD 65–70 bn by 2030 (IBEF).
- Global brands keep arriving. Over 30 global brands entered India in 2025 (IBEF). IKEA said in January 2026 it would more than double its India investment, to over ₹20,000 crore, within five years, adding stores and local sourcing (Reuters, 20 Jan 2026).
- Export inventory models are now allowed. Press Note 3 (2026) lets marketplace entities with FDI hold inventory to export goods made in India, effective 3 September 2026. Inventory-based selling to Indian consumers remains closed to FDI (EY alert, September 2026).
Note: The USD 80 bn online retail market (IBEF, FY2025-26) and Amazon’s goal of USD 80 bn of e-commerce exports by 2030 are different figures that happen to share a number. Keep them separate.
Where the opportunity is
Foreign brands are investing across six consumer segments. Each has drawn foreign capital or brand entry in 2025–26. Market figures are published estimates, shown with their year. The tag after each heading is the FDI or tax rule that frames the segment.
Single-brand stores — 100% automatic
IKEA said in January 2026 it would more than double its India investment, to over ₹20,000 crore, within five years, taking its stores from six to 30. Retail leasing in the top seven cities reached a record of about 8.9 million sq ft in 2025.
Marketplaces and e-commerce exports — marketplace: 100% automatic
Amazon announced in December 2025 an investment of over USD 35 bn in India by 2030, with a goal of USD 80 bn of e-commerce exports. Since 3 September 2026, FDI-funded platforms may hold inventory to export Indian goods.
Quick commerce — marketplace model
A USD 7–8 bn market in FY2024-25 that grew 110–130% a year over 2021–25 and is projected at USD 65–70 bn by 2030. In April 2026 Amazon said it would take Amazon Now to 100 cities and over 1,000 micro-fulfilment centres, within a ₹2,800 crore investment (Inc42, 27 Apr 2026).
Beauty and personal care — SBRT or licensing
Invest India projects growth from USD 21 bn in 2023 to USD 34 bn by 2028 (10–11% a year), with online sales reaching 33% of the total by 2028. Lush re-entered India in November 2025 through a licensing partner.
Packaged food and FMCG — food retail: approval
Food processing drew about USD 16.1 bn of FDI equity from April 2000 to March 2026 (DPIIT). Food PLI beneficiaries have invested ₹9,207 crore against ₹7,722 crore committed (PIB, 30 Jul 2026). Retail of food made in India allows 100% FDI with Government approval.
Durables, apparel and footwear — GST cut September 2025
On 22 September 2025, GST on air conditioners, dishwashers and televisions above 32 inches fell from 28% to 18%. Footwear and apparel priced up to ₹2,500 are now taxed at 5%, while apparel above ₹2,500 a piece rose from 12% to 18% (PIB, 3 Sep 2025).
Cash-and-carry wholesale and B2B e-commerce, food retail and duty-free shops are also covered in the FDI rules; textiles appear under central incentives.
The entry models in brief
A brand can enter in three ways. An own subsidiary under single-brand retail trading (SBRT) takes 100% FDI on the automatic route; above 51% FDI, 30% of the value of goods purchased must be sourced from India. A franchise or licence with an Indian partner needs no FDI but leaves the stores with the partner, as with Lush in November 2025. Selling through a marketplace needs no store at all, but delivery, warranty and pricing rest with the seller, not the platform. Multi-brand retail is capped at 51% on the Government route, with a minimum investment of USD 100 million, and only in the states and union territories that have agreed to it.
How this guide is organised
| Page | What it covers |
|---|---|
| Recent investments | Announcements since December 2025 by foreign retailers and consumer groups, as public examples |
| FDI rules | Caps, routes and conditions for SBRT, MBRT, wholesale, marketplaces, inventory exports, food retail, duty-free shops and land-border investors |
| Regulators and registrations | Government approval, GST, Shops and Establishments, CDSCO, FSSAI, Legal Metrology, BIS, CCPA and DPDP |
| Central incentives | PLI schemes, PM MITRA, ELI, Budget 2026-27 export measures, Export Promotion Mission, ONDC and Mega Food Parks, with status as printed |
| State incentives | Tamil Nadu, Maharashtra, Karnataka, Uttar Pradesh and Haryana |
| Tax and zones | GST changes, the personal-import tariff, courier exports, equalisation levy, duty-free shops and MOOWR, plus the corporate and withholding tax tables |
| Set-up roadmap | Ten steps from entry decision to first store, the entry vehicles and the ten incorporation steps |
| What to watch | Sourcing proof, marketplace neutrality, wholesale limits, dark patterns, gig workers and land-border owners |
| Recent changes | What changed since 2025, as a dated table |
| Sources | Every reference the brochure cites |
What to check next
- Decide between an SBRT subsidiary, a franchise or licence, and marketplace selling before any other step; the FDI conditions follow from the choice.
- If FDI will exceed 51%, model purchases against the 30% India-sourcing test from the first year.
- Check whether your target state is on the multi-brand retail consenting list; Tamil Nadu is not.
- Map every product category you will sell against CDSCO, FSSAI, Legal Metrology and BIS requirements before the first import.
- Confirm current GST rates for your products against the 56th GST Council decisions of 3 September 2025 (see GST and customs).