1.The $ 44.9 billion FMCG
Hinterland consumes around 60% of the total goods manufactured in India with majority of the products coming from FMCG sector. As per the Indian Brand Equity Foundation, the overall FMCG market is expected to increase at a CAGR of 14.7 per cent to touch US$ 110.4 billion in the period 2012-2020, with the rural FMCG market anticipated to increase at a CAGR of 17.7 per cent to US$ 100 billion during 2012-2025.
2. Great opportunities for retailers
Indian market is dominated by rural population with over 720 million consumers spread across 0.63 million villages in the country. Therefore most big retail companies have been catering the untapped rural market. ITC has taken a rural initiative through Choupal Sagar, DCM with Hariyali Kisan Bazaars, and Pantaloons in a JV with Godrej (Aadhars). As per the recent Nielsen estimates, consumption in rural areas is growing at 1.5 times the rate in urban areas.
By 2025, India is expected to become the fifth largest consumer durable market in the world. Hinterland will play a major role in making India the fifth largest in the world as rural consumer durable markets is growing by 30%, and it is expected to grow by 45% in FY 2014. The demand from rural and semi-urban areas is projected to expand at a CAGR of 25 per cent to US$ 6.4 billion in FY15.
4. BPO in Rural India
BPO services in metros now seem to be focused more on high-end knowledge-based services, while there’s been a silent shift happening to smaller Indian towns. One of the biggest benefits that rural BPO services bring is employment to villages and small towns. This development also helps mitigate the risk of BPO jobs moving to alternate locations, ensuring the growth of BPO in India.
5. Telecommunication with 302.73 million rural users
Today, India stands as the second largest in telecommunication market in the world. As per the data released by Cellular Operators’ Association of India, the country’s GSM operators added 2.10 million rural users in June 2014, taking their total to 302.73 million. Bharti Airtel has the maximum rural users at 96.63 million, whereas Vodafone added 90.91 million. Idea Cellular’s rural subscriber base stands at 76.85 million, whereas that of Aircel and Uninor stand at 25.96 million and 12.38 million, respectively.
6. Internet penetration and E-commerce
E-commerce companies understand the growth potential of rural India. The unavailability of attractive offline channels in under-developed cities has encouraged the brand-aware population to shop online. According to a data, 3,311 Indian cities were engaged in online shopping of which over 1,267 were non-metro cities.
7.The Rise in demand for better Healthcare
Healthcare market of India is currently estimated at USD 80 billion, and is expected to grow to USD 280 billion by 2020. As per the investment Commission of India, the healthcare industry in India has experienced a remarkable growth of 12% per year. Due to rising population, disposable incomes and literacy; increasing incidence of lifestyle diseases; increasing penetration of health insurance; and medical tourism have all contributed to the demand for better healthcare in rural India.
8. Two-wheeler market
Rural India accounts for almost 37% of automobile industry sales. Strong rural demand and rising popularity of scooter, cars tractors have helped automobile marketers to increase their sales. A total of 16.9 m two-wheelers were sold in FY14. Motorcycles accounted for 74% of the total two wheelers sold and grew by a mere 4%. The scooters (geared and ungeared) segment was the star of the two wheeler industry logging in a growth rate of 22%.