India's retail sales rise 8% in Jul, GST reforms shape festive outlook

India’s retail sales grew 8 per cent year-on-year in July 2025, marking the third consecutive month of 7–8 per cent growth. This steady recovery from the 3–5 per cent levels earlier this year shows consumers are gradually opening wallets for discretionary purchases.

Retailers are cautiously optimistic as the festive and wedding season approaches, with momentum over the next quarter seen as the real barometer of sentiment.

In 2024, festive sales rose 7 per cent during October–November but slowed to 5 per cent in December. Household budgets also felt pressure from inflation and EMI obligations, curbing discretionary appetite, Retailers Association of India (RAI) said in a release.

This year, expectations are tied to GST reform. The new two-slab structure and removal of inverted duty in textiles are seen as positive moves boosting clarity and consumption in categories like food and CDIT.

However, concerns linger on garments and footwear above ₹2,500 now taxed at 18 per cent, mobile phones remaining under the 18 per cent slab despite being essential, and high GST on commercial rentals squeezing small and medium retailers’ working capital.

ALCHEMPro News Desk (HU)