Despite the fact that every major international retail giant, from Walmart to Carrefour to Tesco, is looking to establish its presence in the country, India ranks 44 in a list of 250 most preferred retail destinations in the world.
A report by global real estate consultancy CB Richard Ellis, How Global is the business of retail, ranks the UK as the leader in international retailer presence, with 55 per cent of retailers surveyed present there. Ranked second is Spain with 51 per cent of retailers present. India is way behind China and Russia, who have found a position in the top 10.
The primary reason, says the report, for India lagging behind is the restriction on foreign investment in the retail sector, which is capped at 51 per cent for single-brand stores.
Speaking about the report,
Magazine, chairman and managing director, CB Richard Ellis South Asia, said: "Even though the Indian economy is growing at a rapid pace with consumers having more buying power, we are still only at 44th position on this list. This is primarily due to foreign direct investment (FDI) restrictions in retail and also relatively lower average per capita income in the country. Hopefully, if these norms are relaxed, coupled with expected economic growth, India could move up in the rankings."
France and Germany also performed strongly in the global ranking, achieving third and fourth positions, respectively, and emerging markets, including the United Arab Emirates, China and Russia, all figured in the top 10.
The United States, surprisingly, registered outside the top 10, at number 11, with 39 per cent of international retailers present in that market. The report attributes this to the maturity, size and strength of its domestic retailers, which make it a market that only the strongest foreign retailers are able to break into.
The report also analysed which categories of retailers have the strongest international penetration, and found that luxury goods dominated international retail expansion, with almost 90 per cent having a presence in more than 10 markets. This was markedly more than grocery, food and drink retailers, with just 60 per cent present in 10 or more markets, and clothing, footwear and accessories retailers, of which 54 per cent were in more than 10 markets.