The luxury market in India is estimated to exceed $14 billion in the next three years.

The Associated Chambers of Commerce and Industry of India (ASSOCHAM) said despite a continuing global economic slowdown, the luxury market in the country has touched around $8.5 billion, with a growth rate of 25-30 per cent in 2013, compared with just $6.5 billion in 2012.

“A young demographic profile, growing number of millionaires and billionaires and aspirational integration with the globe are all among the driving factors for the luxury markets which see a big potential in India,” said D S Rawat, secretary general, ASSOCHAM.

“Since the high-end products and life styles are not price elastic, they don’t get much affected by the slowdown,” he said.

The sectors such as five star hotels and fine-dining, electronic gadgets, luxury personal care and jewellery performed well in the year of 2013 and are expected to grow by 30-35 per cent over the next three years.

Big ticket spends such as on luxury cars mainly SUV are likely to continue, growing upwards of 15-20 per cent over the next three years, driven by consumption in smaller towns and cities.

ASSOCHAM said 2014 will be a good year for the Indian luxury market though the country will be facing general elections and not much economic reform may occur. The market will take off due to a good economical context and the increase of consumers’ spending pattern and the craze increasing for branded products especially amongst the youth.

“Luxury jewellery, electronics, SUV cars and fine dining have grown beyond expectations, while apparel, accessories, wines and spirits have continued their strong growth in 2013,” it says.