CMAI–1Lattice consumer study report highlights rapid casualisation, rising momentum in womenswear and kidswear, lifestyle-led consumption and the enduring strength of physical retail.
India’s domestic apparel market is entering a new phase of sustained growth, with the market projected to rise from $95.7 billion (approximately Rs 8 trillion) in CY2025 to $146.3 billion (about Rs 12 trillion) by CY2029, representing a 9 per cent CAGR, according to the Indian Apparel Market Size: A Consumer Research Report 2025, released by the Clothing Manufacturers Association of India (CMAI) in association with 1Lattice, a leading market research consulting organization.
The study shows India is now the fourth-largest apparel market globally and reveals a consumer landscape undergoing significant transformation. Rising casualisation, evolving lifestyles, stronger demand from women and children, increasing preference for comfort and functionality, and the continued importance of physical stores are reshaping how Indians discover, purchase and consume apparel.
India’s apparel market has already demonstrated a strong post-pandemic recovery, expanding from $49.3 billion in CY2020 to $95.7 billion in CY2025, equivalent to an 18 per cent CAGR over the period.
The findings of the 2025 consumption survey are further reinforced by the annual business and market intelligence reported by leading listed apparel companies in India, including Aditya Birla Fashion & Retail, Arvind Fashions, Raymond, Page Industries, Kewal Kiran Clothing, Vedant Fashions, Gokaldas Exports, Cantabil Retail, TCNS Clothing and others. The convergence of consumer-level survey findings with the annual performance trends and business indicators of these leading listed companies provides a broader and more robust perspective on the evolving Indian apparel market, consumer demand and consumption dynamics.
Commenting on the study, Santosh Katariya, President, CMAI, said “The next phase of growth for India’s apparel industry will increasingly come from markets beyond the metros. Tier-2 and Tier-3 cities are already contributing significantly to apparel consumption, while rising aspirations are creating demand for a wider choice of brands, formats and fashion. The opportunity now is to build propositions that are contemporary, relevant and accessible to the emerging Indian consumer, while deepening distribution and retail presence across these markets.”
The findings point to an apparel market where consumers are becoming more diverse in their preferences, with demand spanning everyday casualwear, traditional and occasion-led clothing, formalwear, athleisure and functional apparel. Rahul Mehta, Chief Mentor, CMAI, said “One of the most significant shifts in India’s apparel consumption is the blurring of traditional category boundaries. Men’s wear is becoming more casual, comfortable and versatile, with consumers seeking styles that can transition seamlessly between work, leisure and social occasions. At the same time, women’s wear remains deeply rooted in ethnic wear while evolving through new silhouettes, Indo-Western styling and greater versatility. These shifts reflect an Indian consumer adapting apparel choices to a more contemporary and dynamic lifestyle.”
Six trends reshaping India’s apparel market
1. Rural India is the biggest consumption engine
One of the most striking findings is the geographic composition of the market. Of the approximately $95.7 billion apparel market in CY2025, $55.9 billion came from rural India, representing roughly 58 per cent of total apparel consumption. Metro & Tier-1 markets together accounted for only $14.2 billion, while Tier-2 contributed $8.5 billion, Tier-3 & below $17.1 billion.
This fundamentally changes the conventional perception of India’s apparel market. The growth opportunity is not confined to Mumbai, Delhi, Bengaluru or other major urban centres. The next billion-dollar opportunities are increasingly emerging from smaller towns and rural markets. For apparel brands & manufacturers, this means that distribution, pricing, product assortment and localised merchandising could become as important as brand building.
2. Casualisation is becoming a defining consumption trend
Casualwear has emerged as the largest apparel occasion in India, accounting for 31 per cent of the market, followed by ethnic wear at 27 per cent and formalwear at 26 per cent.
Consumers are increasingly prioritising comfort, versatility and clothing that can be worn across multiple occasions. In menswear, this is translating into strong demand for sub-categories like denims and T-shirts, while womenswear and kidswear are also seeing greater adoption of versatile, easy-to-wear styles.
3. Lifestyle, comfort and functionality are driving new demand
Changing lifestyles are increasingly influencing apparel choices, with fitness, comfort and functionality emerging as important demand drivers.
In menswear, Athleisure is gaining momentum, supported by demand for quick-dry T-shirts, stretchable joggers and moisture-wicking polos. In kidswear, growing parental focus on health and activity is driving interest in sportswear and activity-specific clothing, while breathable and easy-to-wear garments are supporting casualwear demand.
4. Womenswear and kidswear are gaining momentum
Menswear remains India’s largest apparel segment at $38.5 billion in CY2025, followed by womenswear at $35.6 billion and kidswear at $21.6 billion.
However, the growth trajectory is shifting. Between CY2025 and CY2029:
- Kidswear is projected to grow at 9.4 per cent CAGR
- Womenswear is projected to grow at 8.9 per cent CAGR
- Menswear is projected to grow at 8.5 per cent CAGR
Kidswear is expected to reach approximately $34 billion by CY2029, while womenswear is projected to reach approximately $55 billion.
Womenswear growth is being supported by increasing workforce participation, rising demand for Athleisure and the growing popularity of Indo-Western styles. The study also identifies increasing consumer interest in sustainable and ethical fashion choices.
5. Traditional and occasion-led apparel remains a powerful consumption engine
The rise of casualwear is taking place alongside continued demand for traditional and occasion-led clothing.
Ethnicwear accounts for 27 per cent of India’s overall apparel market, and approximately 60% of womenswear, with sarees and salwar suits among the largest segments.
In menswear, weddings and other celebrations continue to support demand for ethnic & occasion-led apparel, including sherwanis, bandhgalas and Indo-Western outfits.
This coexistence of everyday casualwear and traditional occasion-led consumption highlights the breadth and diversity of India’s apparel market.
6. India is becoming omnichannel, but offline retail remains central
India’s apparel consumer is increasingly engaging with both digital and physical channels. However, offline retail continues to dominate, accounting for 83 per cent of apparel sales in CY2025, compared with 17 per cent online.
Offline apparel sales were estimated at $79.4 billion, with Exclusive Brand Outlets accounting for approximately 50 per cent of offline sales.
Online apparel sales stood at $16.3 billion, with marketplaces contributing approximately 80 per cent of online sales, compared with 20 per cent through D2C websites.
The research shows that digital adoption is expanding the consumer journey rather than replacing physical retail, reinforcing the importance of an omnichannel approach for brands and retailers seeking to capture India’s next wave of apparel growth.
Demand Outlook remains broad-based
At the category level, menswear stood at $38.5 billion in CY2025, followed by womenswear at $35.6 billion and kidswear at $21.6 billion.
Within menswear, formalwear was the largest category at $17.1 billion, followed by casualwear at $15.5 billion.
Within womenswear, ethnic wear remained the dominant category at $21.2 billion.
In Kidswear, casualwear stood at $9.4 billion, ahead of formalwear at $7 billion.
Taken together, the findings point to a market where growth is being driven not by a single category or consumer cohort, but by the convergence of rising incomes, changing lifestyles, expanding aspirations, category innovation and greater access to brands and retail formats.
The consumption pyramid is broader than the organised market
The sheer scale of rural and non-metro consumption also highlights the continuing importance of the fragmented apparel ecosystem. The market’s future expansion will not come exclusively from premium branded consumers.
A large portion of growth will come from first-time branded consumers, upgrading consumers and consumers moving from unorganised to organised retail. This makes value-for-money positioning particularly important. The opportunity is therefore not simply premiumisation. It is aspirationalisation across price points.
The report suggests that India’s next phase of apparel growth will be defined by greater consumer diversity, faster-changing preferences and a more dynamic retail landscape. For manufacturers, this means greater flexibility and faster product cycles. For brands, it calls for sharper segmentation and stronger consumer insight. For retailers, it creates an imperative for regionalised assortments and seamless omnichannel integration. Together, these shifts point to a market that is becoming more dynamic, diverse and consumer-led, creating significant opportunities across the apparel value chain as India enters its next phase of growth.