Indian market: Comité Colbert signs agreement to facilitate French luxury expansion

Comité Colbert, a French committee uniting over 90 luxury houses across multiple sectors, formalised a Memorandum of Understanding (MoU) with the French-Indian Chamber of Commerce and Industry, with the ambition to support the development of French luxury houses in India and remove the main barriers to their establishment in this growing market.

The partnership was formalised in the presence of Sanjeev Singla, ambassador of India to France; Éléonore Caroit, minister delegate to the minister for Europe and foreign affairs, responsible for Francophonie, international partnerships and French nationals abroad; and Marc-Antoine Jamet, secretary general of LVMH.

Comité Colbert aims to accelerate French luxury development in India

The observation is that brands established themselves in India relatively early. However, many subsequently slowed their investments due to a lack of growth. According to Bénédicte Epinay, general delegate of Comité Colbert, the situation has changed profoundly in recent years and brands must reassess the potential of the Indian market.

India has numerous cities with over ten million inhabitants and is now the third country in the world for the number of billionaires. It also has a significant population of millionaires.

To illustrate this potential, Jamet cited a few figures: ten million weddings are celebrated in India each year. A wedding lasts an average of four days. For one of these days, guests wear Western outfits, thereby creating opportunities for French houses.

Another indicator: LVMH employs around 300 staff in India, compared to approximately 20,000 in China. The group wishes to reach a level comparable to that of China and have as many stores in India as it does in France.

Closer trade relations with India appear to be a response to the uncertainties surrounding trade with the US and China. However, there are still three barriers to entering this market.

Non-tariff barriers (BIS), main obstacle to luxury development in India

Comité Colbert is making the simplification of non-tariff barriers its priority. The constraints particularly concern tannery processes and certain chemical substances, which are banned in India but permitted in other countries. Companies must undertake numerous administrative procedures with multiple authorities.

For some luxury houses, compliance costs are equivalent to, or even exceed, the turnover generated in India.

Customs duties remain very high on many product categories. They are the primary obstacle to market entry. Free trade agreements between the European Union and India should, however, gradually eliminate these duties. The stated objective is for customs duties to be abolished within approximately five years.

According to the European Union representative, this is the most significant free trade agreement ever concluded between the European Union and a single country. It is expected to facilitate both European exports to India and the trade of raw materials such as diamonds and precious stones.

On the distribution side, premium shopping centres are a recent development. The main high-performing malls have been established within the last ten years. The Jaya World mall in Mumbai opened in 2023. The high-end retail offering is therefore still under construction.

The MoU is the first international partnership of its kind focused on the Indian luxury market. It includes plans for round tables, symposiums, professional delegations, dialogues with public authorities and cultural exchange programmes.

This article was translated to English using an AI tool.

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