New Delhi: Stressing the need for India to create its own luxury brands, NITI Aayog CEO Amitabh Kant on Friday said the circle of growth should expand and move from tier 1 cities to tier 2 and tier 3 cities.
"India should create its own luxury brands like France and Italy, because brands give you value over a period of time... If you want luxury markets to grow and expand in India then it is very important that we keep expanding the circle of growth and move from tier 1 cities to tier 2 and tier 3 cities," Kant said at an event organised by industry body Assocham.
"In tier 1 cities, the rents are extremely high...rents are high because land value has been very high. Luxury market has to grow, we need to provide space at low cost, fortunately, in my view with demonetisation, land prices will fall over a period of time and that will give further push to the growth of the luxury market," he added.
Noting that growth in luxury markets in Europe and America was directly associated with baby boomers who were born during 1946 to 1964, the NITI Aayog CEO said that while the population in Europe and America is getting older and older, the population in India is getting younger and younger, and India will keep getting young till 2040, therefore, luxury market in India will keep growing.
India has been inspiring the luxury and fashion industry of world for years, Kant said adding,"As High Networth Individuals (HNIs) in India are growing, their spending on lifestyle products will increase, so luxury markets in India will keep growing."
He said that one needs to look at luxury market from a long-term perspective.
"As India continue to grow and expand, the luxury market will grow in a big way," Kant pointed out.
He also emphasised that India needs to grow at 9-10 per cent for the next 30 years to lift its vast population out of poverty.