Fireworks light up the night sky during Diwali celebrations in India.
India’s festive economy is witnessing strong activity across traditional markets, digital payments and e-commerce, but the latest data also points to growing caution among urban consumers.
According to the Confederation of All India Traders (CAIT), Diwali-related trade across the country is expected to cross ₹7 lakh crore this year. The traders’ body said business had already crossed ₹6 lakh crore by November 7, while Delhi alone recorded trade worth more than ₹1 lakh crore.
Gold, silver, jewellery, electronics, automobiles, clothing, sweets and festive decorations were among the major categories driving purchases.
Urban households expected to spend less
However, the strong trade estimates come alongside signs of pressure on household budgets.
A LocalCircles survey estimates that urban Indian households will spend approximately ₹1.97 lakh crore on discretionary festive purchases in 2026, down 6% from ₹2.10 lakh crore in 2025.
The survey found that 57% of urban households planned festive spending, while 31% did not intend to make discretionary purchases.
It also found that 83% of households planning to spend expected to use their savings to fund at least part of their purchases.
Online festive sales record slower growth
India’s online festive sales have also recorded slower growth.
According to a November 8 report by The Financial Express, online festive sales grew 13–15% year-on-year, below industry expectations of 20–25%.
Rising prices of smartphones, laptops and large appliances, along with fewer discounts, affected big-ticket purchases.
Quick commerce and smaller purchases gain momentum
However, smaller purchases and quick commerce continued to gain momentum.
Data from e-commerce technology platform Unicommerce showed that online order volumes increased 21% between October 6 and November 4 compared with the corresponding period last year.
Quick-commerce order volumes grew 75%, while their gross merchandise value increased 38%.
UPI transactions hit a record high
India’s digital payments ecosystem also recorded a major milestone.
According to the National Payments Corporation of India (NPCI), UPI processed a record 25.47 billion transactions worth ₹31.53 lakh crore in October.
The average daily transaction value crossed ₹1 lakh crore for the first time.
GST collections rise 22.9%
India’s gross GST collections reached ₹2.31 lakh crore in October, registering 22.9% growth compared with the same month last year.
Net GST collections stood at approximately ₹2.03 lakh crore, up 25.6%.
Automobile sales present a mixed picture
The automobile sector presented a mixed picture.
According to the Federation of Automobile Dealers Associations (FADA), vehicle retail sales declined 23.8% year-on-year in October to 31.72 lakh units.
However, the decline was partly attributed to a shift in the festive calendar, as Diwali fell in November this year compared with October in 2025.
Electric vehicle sales, meanwhile, reached a record 3.55 lakh units in October, registering nearly 45% annual growth.
India’s festive consumption landscape is changing
Overall, the latest figures present a mixed picture of India’s festive economy.
Traditional market trade, digital payments, quick commerce and electric vehicle sales are showing strength, while urban household spending projections and online sales growth indicate greater caution among consumers.
The data suggests that India’s consumption story is evolving, with smaller cities, affordable purchases and digital commerce playing an increasingly important role.
The bigger story this Diwali is not just how much Indians are spending, but how their spending habits are changing.
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