For companies looking to target high potential markets of tomorrow, global consulting major McKinsey & Company has identified 49 'metropolitan clusters' that could be growth hotspots in India.

These 49 metropolitan clusters will drive about 77 per cent of India's incremental GDP from 2012-2025, McKinsey said in a report titled 'India's economic geography in 2025: States, Clusters and Cities' released today.

By 2025, they would be home to 72 per cent of the consuming class and 73 per cent of income pool.

Of the 49 metropolitan clusters, 29 are located in 'performing and low performing' States which will lift the largest number of households to become Aspired households, the report added.

Of these 49 clusters, 21 are 'high growth high affluence' clusters --they rank highest on income per capita and are expected to grow faster than remaining clusters in India. They are expected to account for 44 per cent of India's consuming class and provide access to 47 percent of India's total income pool.

A 'metropolitan cluster' is a group of districts that have high economic potential, are contiguous such that each cluster represents serviceable market, and have a metropolitan district as the nucleus.

Tailoring strategies to the specific needs of customers in these 49 clusters can provide companies with a significant competitive advantage, particularly in consumer oriented industries such as cosmetics, sanitary ware, building products, apparel, telecom and financial services, the report said.

Allocating resources to these markets based on their potential can enable more targeted and hence profitable growth, it added.

49 METROPOLITAN CLUSTERS

There are four clusters in 'very High Performing States' ( Delhi, Chandigarh, Goa, Puducherry), 16 in High Performing States, 17 in performing States and 12 in low performing States.

The 16 clusters in 'High Performing States' are Mumbai, Chennai, Ahmedabad, Surat, Kochi, Coimbatore, Nagpur, Rajkot, Ludhiana, Thiruvananthapuram, Nashik, Tiruchirapalli, Aurangabad, Madurai, Solapur, Kozhikode.

The 17 metropolitan clusters in Performing States are Kolkata, Bangalore, Vishakapatnam, Hyderabad, Vijayawada, Jaipur, Kadapa, Adilabad, Nellore, Bhubaneswar, Jhodhpur, Raipur, Bikaner, Hubli Dharwad, Udaipur, Amritsar and Kota.

The 12 metropolitan clusters in low performing States are Jamshedpur, Saharanpur, Lucknow, Jabalpur, Indore, Bareilly, Agra, Ranchi, Varnasi, Patna, Bhopal and Gwalior.

GDP GROWTH

This McKinsey report has forecast India's average economic growth over the period 2012 to 2025 could be in the region of 7.2 percent a year. This forecast is assuming a scenario of 'growth renewal'.

This forecast is also in the absence of any domestic and international upheaval in this period.

It is also predicated on pace of reforms undertaken by the national and state governments, global political and investment climate and whether the 2019 general elections result in a stable government with a decisive mandate.

The base case assumption is annual 6.1 percent GDP growth (gradual recovery) for the latest study.

Srivats.kr@thehindu.co.in

comment COMMENT NOW