India's rising affluent class to drive premiumization and consumption growth

As India's affluent class continues to grow, there is a shift towards premiumization in various product categories. Manufacturers are adding more features to products and selling them at higher prices, with the average selling price increasing in categories such as refrigerators and shoes. This trend supports the theory that the affluent segment is driving consumption and willing to pay more for upgraded lifestyles. However, there are some factors to consider. Goldman Sachs' report may be biased towards selling a positive narrative about India's consumption potential. Additionally, while the report suggests that the affluent segment will expand to 100 million by 2027, it's important to note that income adjustments for inflation may classify more individuals as affluent without necessarily indicating wealth growth. Furthermore, the affluent class mentioned in the report represents only 4% of India's working-age population, raising questions about the long-term sustainability of consumption growth driven primarily by a small subset of the population.