Retail sales rise by 8% Y-o-Y in July 2025

10 September 2025, Mumbai 

India’s retail sales increased by 8 per cent Y-o-Y in July 2025, continuing a three-month streak of 7-8 per cent growth. This recovery from the earlier growth of 3-5 per cent indicates, consumers are gradually increasing their spending on non-essential items. As the festive and wedding season approaches, retailers are cautiously optimistic, with the expectation that this positive trend will continue.

The festive quarter is a key indicator of consumer sentiment. In 2024, sales grew by 7 per cent from October to November before slowing to 5 per cent in December. Categories like food and groceries, quick-service restaurants (QSR), jewelry, and consumer durables were top performers. In contrast, sales of automobiles and white goods decreased as customers held off on purchases in anticipation of tax changes. Inflation and loan payments also put a strain on household budgets, leading to a more conservative spending pattern.

This year, the retail outlook is strongly linked to recent GST reforms. The new rates are expected to boost consumption in most categories, including food, electronics, and others.

The introduction of a simpler two-tier tax structure and the removal of the inverted duty on textiles are positive changes that provide more clarity for retailers.

However, some concerns remain. The 18 per cent tax on garments and footwear priced above Rs 2,500 and high GST on commercial rentals pose challenges. These factors could put a strain on the working capital of thousands of small and medium retailers.

Key industry voice, the Retailers Association of India (RAI) is actively working with the government to support employment, promote investments, and improve consumer choice and industry competitiveness.

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