Revisiting India’s consumption story

Over the past few years, and especially since the pandemic, a list of familiar global names has thinned out of India’s consumer landscape. Dulux Paints (AkzoNobel sold its India business to JSW Paints), MG Motor (whose Chinese parent SAIC is progressively ceding control to JSW Group), Harley-Davidson, Citibank’s and now Deutsche Bank’s retail banking franchises, Ford Motors, Metro Cash & Carry, the Disney-Star combine, and Oriflame have all either sold out, scaled down, or handed the wheel to an Indian partner. Holcim exited ACC and Ambuja Cement. And as I write this, Volkswagen is reportedly in advanced talks to give JSW Group majority control of its India operations.

Strung together like this, the list reads like a verdict: global capital is losing patience with India’s consumption story. I don’t think that verdict survives a closer look — but the list is still worth taking apart, because the reasons behind each exit tell a more interesting story than the headline count does.

Not all exits are the same

Put these names together and it may look like one trend. But actually, it is at least four different stories.

The first is genuine competitive loss in a market that has moved on. Harley-Davidson’s 2020 retreat from direct sales and the slow bleed of foreign retail banking — Citibank’s book to Axis in 2023, Deutsche Bank’s now headed to Kotak — belong here. In both cases, the economics of scale — dealer networks, branch footprints, distribution cost — favored domestic players who could out-invest and out-price the global brand. This is the closest thing to a real “local brands are winning” story, and it is real.

The second is regulatory and geopolitical, not consumption-driven at all. SAIC is diluting its stake in MG Motor primarily because Chinese capital has faced tightened scrutiny since the 2020 border standoff — not because Indian buyers have stopped wanting MG’s cars; the Windsor EV, in fact, has sold rather well. Reading MG into a consumption-story narrative is a category error.

The third is global portfolio rationalization that has little to do with India specifically. Ford’s 2021 exit was part of a worldwide restructuring that also closed plants in Brazil and elsewhere. Holcim’s sale of ACC and Ambuja was a cement conglomerate stepping back from a market it judged non-core to its European strategy — not a comment on Indian construction demand, which has stayed fairly resilient. Disney folding its India business into the Reliance-controlled JioStar venture mirrors what Disney has done to linear television everywhere as broadcast economics erode; Reliance, not the Indian consumer, is the reason Disney still has a seat at that table at all.

The fourth is a capital-and-control trade, not a retreat. Volkswagen’s reported talks with JSW are not Volkswagen leaving India — they are Volkswagen conceding, after twenty years and a stubborn sub-3 per cent market share, that it cannot fund the next EV cycle alone and needs a local partner who reads the price-sensitive Indian buyer better than Wolfsburg does.

The JSW thread

One thing this exercise turned up that I did not expect going in: JSW Group shows up on the buying side of an unusually large share of these stories — MG Motor, Dulux Paints, and now potentially Volkswagen. That is not proof of anything by itself, but it is a useful reminder that “global MNC exits India” and “India loses access to global capital and technology” are not the same sentence. In each case, an Indian conglomerate with balance-sheet strength is buying its way into precisely the categories — autos, EVs, paints — that are supposedly the casualties of a weakening consumption story. That is an odd thing to do if the underlying demand were actually disappearing.

What the FDI numbers actually say

If the consumption story were genuinely broken, I would expect the capital data to show it. It does not, at least not yet. Gross FDI inflows into India rose to roughly $39 billion in calendar 2025 per UNCTAD, DPIIT’s own FY26 numbers show a similar climb, and India’s ranking among global FDI destinations improved rather than slipped. One caveat is worth flagging honestly: UNCTAD’s tracking also shows the value of newly announced greenfield projects easing off its 2024 peak, which suggests investors are increasingly buying into existing India-scale platforms — the JSW pattern again — rather than building fresh capacity from scratch. That is a subtly different form of confidence, not necessarily a weaker one.

Where this leaves the consumption thesis

I don’t read this list of exits as evidence that India’s consumption story might be weakening. I read it as evidence that the story is maturing. The easy years, when any global brand could set up shop and ride a rising tide on its own, are behind us. What survives now is either a business with genuine India-specific scale economics, or one willing to share control and capital with a domestic partner who has already solved for the Indian price point. That is a tougher bar than it used to be — it is not the same as demand disappearing.

Investor takeaways

·         Don’t treat every foreign MNC exit as one signal. Ask why — competitive loss, geopolitics, global restructuring, or a capital/control trade each carries a different implication for India-facing businesses.

·         Watch the consolidators as closely as the businesses exiting. JSW and its peers are effectively buying discounted access to categories — autos, paints, EVs — that global capital still wants exposure to.

·         Track greenfield investment announcements, not just aggregate FDI inflows, for a cleaner read on fresh conviction versus capital simply changing hands.

·         The bifurcation thesis I have written about earlier — mass versus premium, with the middle squeezed — remains, in my view, a better explanation for these exits than a blanket loss of faith in Indian consumption.