INTRODUCTION
India and Italy have over the years developed strong business and trade ties. The bilateral trade between the two countries was valued at USD 14.25 billion in 2022-23. Italy is the 18th largest foreign investor in India with a cumulative FDI inflow of USD 3.40 billion from April 2000-September 2023 and fashion and textile play a vital role in the growth of the FDI in India. Fashion and Luxury are important aspects of the FDI growth in India. New entities and companies are established and set up to cater to the growing fashion market in India.
With the luxury retail market in India expected to reach USD 30 billion by 2025, it’s clear that this sector will play a major role in the retail industry. Having a grasp on how luxury brands adapt to customer expectations and market trends is crucial since the luxury market is dynamic and ever-evolving.
THE FASHION
The Italian and Indian fashion share many similarities, including a focus on luxury, craftsmanship, and a culture that values creativity. In recent times, more so on account of the increase in the per capita GDP of the country and in the inclination of the middle-class population to acquire luxury goods, India has seen a welcoming response towards luxury brand fashion. The Italian luxury fashion house such as Moschino and Alberta Ferretti, Pollini, Gattinoni, Byblos and Scorpion Bay have already had their presence in the Indian market through strategic operations. Other Italian brands such as Gucci, Salvatore Ferragamo, Versace, Armani, Ermenegildo Zegna, Tod’s and Boggi Milano, have been selling their products through local partnerships.
Looking at the consumption and demand for foreign luxury goods into India, the Indian Corporate Houses are also signing strategic partnerships with various international luxury brands. The Corporate Reliance Industries through its subsidiary Reliance Brands, which sells a raft of global labels, has inked a deal with Italian fashion house “Valentino” to launch its products in India. Reliance Brands also sells luxury brands like Ermenegildo Zegna, Bally and Brooks Brothers in India. It has also become the official retailer of TOD’s SpA, the Italian luxury brand in India since 2022. Reliance Retail’s owned “Hamleys” has opened its first exclusive store in Milan with an Italian franchisee namely GIOCHI PREZIOSI S.P.A (GP) wherein GP holds the exclusive rights to operate Hamleys outlets throughout Italy. It is located at the focal point within the bustling shopping and tourist hotspot of Corso Vittorio Emanuele II, Milan.
Another Corporate giant, Aditya Birla Fashion and Retail (ABFRL) has entered into a joint venture partnership with the shoe brand Christian Louboutin for the Indian market though incorporating a new subsidiary wherein they will hold an equal stake.
Further, ABFRL has also entered into a strategic partnership with Galeries Lafayette, renowned globally for its flagship location at Boulevard Haussmann in Paris, to open luxury department stores and a dedicated e-commerce platform in India. The flagship stores in Mumbai and Delhi will bring more than 200 luxury and designer brands under one roof. In Mumbai it is in operational by 2024, while in Delhi it shall be operational by 2025.
On the other side, there has been an increase in the exchange of work between the Indian artisan as well as the Italian luxury brand. The recent collaboration between the Indian artisan Rahul Mishra and the Italian luxury brand Tod’s has proved that Indian fashion has created a range of capsule collections and limited-edition pieces within the Tod’s Factory.
Looking at these collaborations, we have witnessed a lot of similarities between the fashion of Italy and India. Both Italian and Indian fashion are known for their use of high-quality fabrics like cashmere and leather, and for their glamorous style. In terms of craftsmanship, the concept of “Made in Italy” is similar to “Made in India” so as to say that it’s built on a system of small companies working together creatively. Culturally, India has a strong traditional fashion culture, and some say that Italian and Indian cultures are very close. Both countries share similar ideologies in terms of creativity and brand fashion.
From the point of view of statistics, Italy imported USD 19,392. million in apparel and India’s share of Italian imports in 2022 was 1.52%. In 2022, Italy’s fashion textile market generated USD 33,312.8 million in revenue. The market is expected to grow at a compound annual growth rate (CAGR) of 5.1% from 2023 to 2030.
In terms of India Revenue, the Luxury Fashion Market is projected to reach USD 74 million in 2024. Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 10.89%, resulting in a projected market volume of USD123.00m by 2029.
CONCLUSION
The new found corporation between the fashion giants of these two countries shall bring highlighted shift and a rapid growth of the luxury shopping market. Therefore, it is essential that these luxury brands stay on top of the growing trends in order to increase their footprints in the Indian market.