Retailers report 28% year-on-year growth in March due in part to inflation: RAI

By

Isabelle Crossley

Published
Apr 13, 2022

Retailers in India have grown on average by 28% year-on-year in March, 2022 which represents the highest pace since the onset of the pandemic but inflation has played a significant role, according to the Retailers Association of India. 

Retail growth was at 12% higher compared to pre-pandemic March 2019 showing a return to more positive consumer sentiments thanks to lower Covid-19 infection rates and an end to all lockdown and retail restrictions. The fastest growing area of the country for retailers was the West which saw 37% year-on-year growth, according to a survey by the RAI, accessed by ET Bureau. The South grew at the lowest rate at 21%, although this is still a high growth rate. 
 
“However, when looking at the performance, one needs to factor in the inbuilt inflation in most products like garments, electronics and some FMCG [fast moving consumer goods] products,” said the RAI’s CEO Kumar Rajagopalan, ET Bureau reported. 

Retail inflation based on the consumer price index reached a 17-month high in March, 2022 and totalled 6.95% during the month, according to government data released on April 12. This inflation has caused retail prices to rise in many product categories which has also led to higher revenue for retailers, the Times of India reported. If inflation continues at this high rate, many consumers will have to further trim their expenses to keep up which could be challenging for non-essential goods retailers such as garment and cosmetics businesses.