AI to power India’s $2 trillion retail sector by 2030: Deloitte report

India’s retail sector, currently valued at about $1 trillion, is projected to nearly double to $1.9 trillion by 2030, with artificial intelligence at the heart of this growth, according to Deloitte’s new report AI in Retail for the Agentic Era: Aspiration to Action.

The report emphasises that AI is no longer a peripheral tool but a core enabler of enterprise strategy. Retailers are moving beyond pilots and proofs of concept, embedding AI to manage customer journeys, personalise offerings, and automate supply chains.

Anand Ramanathan, Partner and Consumer Industry Leader at Deloitte India, said: “AI is a catalyst for reimagining retail and the time to lead the re-imagination is now.”

Key Drivers of AI Adoption in Retail

    •    Channel-agnostic shoppers: Consumers expect seamless online-offline integration. AI is powering hyper-personalised engagement across touchpoints.
    •    E-commerce surge: Online retail in India is projected to touch ₹27 trillion by 2030. Quick commerce and social commerce are accelerating AI adoption.
    •    Premiumisation: Super-rich households are expected to grow 5x by 2030, driving demand for high-end products and personalised retail experiences.
    •    Urbanisation: With 40% of India’s population expected to live in cities by 2030, urban consumption patterns are reshaping retail strategies.
    •    Gen Z spending: With projected spending power of $250 billion by 2025, Gen Z is driving AI-led digital-first retail .

AI Use Cases Already in Play

    •    GenAI-powered shopping assistants on e-commerce platforms offering real-time product recommendations.
    •    AI algorithms in food delivery apps providing hyper-personalised meal suggestions.
    •    Retail conglomerates using AI to optimise supply chains and store assortments.
    •    Smart stores and digital twins simulating layouts to boost sales efficiency.

India’s AI spending is projected to triple from $7–8 billion in FY23 to $20–22 billion by FY27, growing at 30–35% annually. Deloitte notes that this surge will bring measurable value across three dimensions:

    •    Efficiency: automation and streamlined operations.
    •    Experience: personalised and seamless customer journeys.
    •    Intelligence: data-driven insights for faster decision-making.

Anand Mahurkar, Founder and CEO, Findability Sciences, said, "Agentic AI in retail is about elevating human intent into intelligent action. As agents learn, sense, and act in real time, the brands that thrive will be those that grant them agency — not control — and tether that agency to human purpose. What defines the next generation of retail isn’t automation, but orchestration — the ability of agents and people to co-create value seamlessly, responsively, and with trust."

Despite progress, retailers face challenges such as high implementation costs, data privacy concerns, and legacy system integration. Deloitte recommends:

    •    Investing in AI-ready infrastructure.
    •    Driving cross-functional collaboration.
    •    Prioritising responsible AI with transparency and fairness.
    •    Scaling personalisation and automation.
    •    Adopting a test-and-learn mindset to measure impact.