India had embarked on a series of economic reforms since 1991. The reforms included liberalization
of foreign investment, significant reduction in tariffs and other trade barriers and
significant adjustments in government policies.41 The reforms over the years had resulted in
higher growth rates, lower inflation, and significant increase in foreign investment (see
Exhibit 4). In 2006, India was ranked as the fourth-largest economy in the world in terms of
purchasing power parity42 and the tenth-most-industrialized country in the world.43 In 2006,
the middle class44 in India was estimated at around 250 million and was growing in double
digits in urban and second tier 45 cities.46 The spending power had increased considerably in
the recent years (see Exhibit 5). According to a report47 by KPMG,48 disposable incomes remained
concentrated in urban areas, well-off and affluent classes, and double-income households.
Consumers in the age group of 20–45 years were emerging as the fastest growing
consumer group.
India’s population was one of the youngest in the world and was to remain the youngest in
the coming years (see Exhibit 6). In 2000, one-third of India’s population was below 15 years
India had embarked on a series of economic reforms since 1991. The reforms included liberalization
of foreign investment, significant reduction in tariffs and other trade barriers and
significant adjustments in government policies.41 The reforms over the years had resulted in
higher growth rates, lower inflation, and significant increase in foreign investment (see
Exhibit 4). In 2006, India was ranked as the fourth-largest economy in the world in terms of
purchasing power parity42 and the tenth-most-industrialized country in the world.43 In 2006,
the middle class44 in India was estimated at around 250 million and was growing in double
digits in urban and second tier 45 cities.46 The spending power had increased considerably in
the recent years (see Exhibit 5). According to a report47 by KPMG,48 disposable incomes remained
concentrated in urban areas, well-off and affluent classes, and double-income households.
Consumers in the age group of 20–45 years were emerging as the fastest growing
consumer group.
India’s population was one of the youngest in the world and was to remain the youngest in
the coming years (see Exhibit 6). In 2000, one-third of India’s population was below 15 years
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