In India, Demand For Luxury Products For Diwali Triggers Concern
NDTV
Low-income earners staying on the sidelines and unable to regain their pre-pandemic appetite to buy is a worrying development for an economy that relies on private consumption for some 60 per cent of its growth.
Household spending trends ahead of India's main festive season are flashing warning signs of a widening chasm in demand recovery as inflation hovers around 7 per cent and unemployment keeps on rising.
Consumer-goods makers are reporting robust demand for items priced nearly $2,000, while industry data on sales of budget phones priced below $100 and motorcycles, an indicator of rural demand, are showing a weaker trend.
Customers are in the market for premium products, said Satish NS, senior vice president at the Indian unit of Qingdao, China-headquartered Haier Group Corp. Sales of front-load washing machines, and double-door refrigerators that cost about Rs 150,000 ($1,878) are higher than the low-end products forcing us to push our supply chains in "top gear," he said.
Low-income earners staying on the sidelines and unable to regain their pre-pandemic appetite to buy is a worrying development for an economy that relies on private consumption for some 60 per cent of its growth. India is battling high inflation by raising borrowing costs, which in turn risks damping consumer demand.
