India’s retail sector recorded a 5% year-on-year growth in May 2026, according to Round 71 of the Retailers Association of India’s (RAI) monthly Business Survey.
Regionally, West India emerged as the strongest-performing market with 6% growth, while North and South India each reported 5% growth. East India recorded a comparatively moderate growth rate of 4%, indicating a more cautious consumer spending environment.
Among retail categories, Quick Service Restaurants (QSR) led the growth trajectory with a 9% increase, followed by Food & Grocery at 8%. Footwear registered 6% growth, while Apparel & Clothing, Jewellery, and Sports Goods each reported growth of 5%.
The survey indicates that consumers continue to exhibit measured spending behaviour, with value-conscious purchasing patterns influencing demand across sectors. In response, retailers are focusing on inventory optimisation, customer engagement initiatives, and operational efficiencies to maintain business performance.
At the same time, businesses are increasingly adopting AI-driven analytics and digital technologies to strengthen decision-making, enhance customer experiences, and support sustainable growth and profitability.
Commenting on the findings, Kumar Rajagopalan, CEO, Retailers Association of India (RAI), said:
“Growth eased to 5% in May, down from 7% in April, as inflationary pressures from global conflict weighed on consumer sentiment. Retailers are watching the situation closely as spending turns more cautious.”
The survey highlights the continued resilience of essential consumption categories, with food, grocery, and dining segments remaining key drivers of retail demand despite broader economic uncertainties.
