The Indian ethnicwear market has been a significant segment within the retail industry. As of FY 2023, the market size of Indian ethnicwear stands at USD 20.9 Billion. This segment experienced a substantial decline in FY21 due to the pandemic, but has since recovered, surpassing pre-COVID levels in FY23. The Indian ethnicwear market is projected to continue its strong growth trajectory, driven by factors such as rising disposable incomes, global influence and diaspora, rise of ecommerce, celebrity endorsements, media influence, etc.
By FY26, the Indian ethnicwear market is expected to reach a market size of USD 26.9 Billion with a CAGR of about 9%, reflecting its sustained popularity and market expansion.
Gender Segmentation
The Indian ethnicwear market exhibits distinct trends across different demographic segments. In 2023, the women’s category dominates the ethnicwear market with 81% market share. The kids’ category commands 10% and the men’s category commands 9% market share. The dominance of women’s ethnicwear is driven by the wider variety of garments, frequency of purchase with respect to everyday wear as well as occasion wear, high demand for new designs, colors and patterns, higher willingness to spend on multiple outfits for different occasions, online shopping trends and higher level of customisation involved in women’s ethnicwear leading to higher spending per garment.
Men’s and Kids categories have a similar market size due to the consumer behavior, cultural influences and market dynamics. Both are purchased mostly for specific occasions such as festivals, weddings and cultural events as men and kids are increasingly shifting to western wear on a daily basis. There tends to be lesser emphasis on customisation in both kids’ and men’s ethnicwear compared to women’s ethnicwear, contributing to the lower market size through lower average price points.
The same trend is expected in 2026 with women’s ethnicwear commanding the highest share and men’s and kids’ segments having a similar market size.
Category Mix – Women
Salwar Kameez has the highest share in women’s ethnicwear, commanding USD 9.1 Billion in 2023 due to its versatility, functionality, fusion fashion, appeal across age groups, suitability for different body types, affordability, professional use, etc. Salwar Kameez and kurtis are versatile and can be worn on multiple occasions, they are known for their comfortable fit, ease of movement and practicality making them suitable to a broad demographic for everyday wear, work, and social gatherings. Also, the fusion of modern Indian clothes, such as kurti with jeans, appeals to a wide audience, including younger generations.
Sarees hold a significant share as well in the market with USD 6.8 Billion in 2023 due to its cultural heritage, craftmanship, suitability for all occasions especially for the older generations, fashionable and elegant statement, global appeal, media representation, etc. The global influence of the Indian culture, driven by the frequent feature in international media and increased demand by diaspora has introduced sarees to the global audience. They appreciate the rich culture and its exotic charm.
Category Mix – Men
Kurta sets command the highest share with USD 0.7 Billion in 2023 due to its popularity among the older generations and rural population as daily wear, minimal styling requirement, comfort, fusion appeal, increasing popularity among urban areas for both formal and semi-formal events, varied price points from affordable options to high end designer sets and versatility across regions from North to South India and beyond. Sherwani, Indo western, and Bandis/Nehru Jackets have a similar market size due to their formal and occasional wear preference. However, the share of sherwani will increase from USD 0.5 Billion to USD 0.8 Billion due to the increase in disposable income and the subsequent shift in consumer preferences towards wanting to wear a unique attire for occasion wear, as there is a trend towards formal fusion ethnicwear, where the modern designs and silhouettes are coupled with the elegance of the traditional garment. The growing appreciation and adoption of Indian culture globally has led to an increase in demand for such culturally rich garments, thereby boosting the market size and E-commerce acting as a catalyst.
The Indian Diaspora Contributing to the Growth of Indian Ethnicwear
Ethnicwear isn’t just popular and a growing market in India but has also made its presence internationally with Indians living abroad. They are getting increasingly interested and demanding ethnicwear to express pride in their cultural identity, foster a sense of belonging and cultural continuity for themselves and their children, as well as bridging the gap between cultures of where they come from and where they are residing to encourage a broader acceptance and appreciation for Indian fashion.
Key Factors Contributing to the Growth
- Global Market Reach & E-Commerce Growth: E-commerce has played a pivotal role in providing numerous ethnicwear brands a global stage and a way to reach the Indian diaspora. It enables the Indian diaspora to receive a diverse product offering and a convenient shopping experience. Brand like Biba, Fabindia, etc, are offering a convenient shopping experience, detailed product descriptions, and various payment options catering to the Indian diaspora’s needs. Also, Jaypore is a brand that aims to reach the Indian diaspora especially during festive seasons through targeted advertising and offering promotions on ethnicwear and accessories while igniting the Indian cultural sentiment. Brands such as Manyavar are enhancing their reach and engagement through capitalising on influencers from the Indian diaspora. They promote their festive and wedding collections on social media through collaborations with such influencers and in turn widen their consumer base by reaching potential customers globally.
- Celebrity & Media Influence: Bollywood celebrities and Indian influencers often wear ethnicwear in movies, events, and appearance both globally and within India. Global stars like Priyanka Chopra and Diljit Dosanjh have been bringing Indian festivities and Indian ethnicwear on the Global stage. Diljit Dosanjh was witnessed wearing an Indian Ethnic Attire while at “The Tonight Show” and Priyanka Chopra took to social media to showcase her celebrating holi with her Husband Nick Jonas in Indian ethnicwear attire. Lately, a lot of Hollywood and global celebrities have been seen wearing Indian ethnicwear and embracing the Indian culture. Jennifer Aniston wore an Indian ethnicwear garment, lehenga-choli, in an Indian wedding scene in the movie Murder Mystery 2. On the recent launch of the Nita Mukesh Ambani Cultural Centre, a space that pays a tribute to India’s glorious legacy, traditions, and heritage, global stars like Zendaya attended the launch and wore a saree and promoted the rich culture of India. The limelight that Indian ethnicwear has been getting has contributed to its growth globally.
- Economic Contributions & Market Expansion: The Indian diaspora has a higher disposable income and the willingness to spend on high quality ethnicwear for both gifting and personal use. To fulfill the high demand, multiple brands have opened retail stores outside of India. Fabindia operates stores in markets such as Singapore, the UAE, Mauritius, Malaysia, and the US. Manyavar has 15 international stores across U.A.E, U.S.A, Canada and UK. Also, the Indian retailer Pernia’s Pop-Up Shop has opened its first flagship store just before the pandemic in Mayfair, a popular destination in London for international luxury brands.
- Cultural Promotion & Preservation: The celebration of weddings and festivals outside of India has significantly contributed to the increase in the demand of ethnicwear. The Indian diaspora increasingly feel the need to stay connected to their roots especially with the growing popularity of Indian culture globally. Diaspora communities celebrate weddings and festivals with Indian ethnicwear garments like Sarees, sherwanis, etc.
