E-commerce Industry in India 2023 | Growth | Future | History & More

In India, e-commerce has had a major impact on business practices. India’s e-commerce business is predicted to increase from $46.2 billion in 2020 to $188 billion by 2025, according to a report by the World Economic Forum. US$ 350 billion is estimated to be the total by 2030.

A 21.5 percent growth in the Indian e-commerce industry is forecast for the year 2022, when the sector is expected to reach a value of US$74.8 billion.

An estimated US$ 111 billion would be spent on online shopping in India by 2024, with an additional US$ 200 billion predicted to be spent online by 2026.

The rise in smart phones and internet use has been a major catalyst for the industry’s expansion. As a result of the ‘Digital India’ initiative, the number of people with access to the internet is expected to rise to 830 million by 2021.

Approximately 55% of all internet connections were made in metropolitan areas, of that which 97% were wireless connections.

Market size

• The online grocery industry is expected to grow at a CAGR of 33% around US$ 3.95 billion in financial year 2021 to US$ 26.93 billion in 2027.
• An increase of US$ 537.5 billion in the year 2020 would propel India’s e-commerce and education technology markets to a $1 trillion dollar industry by 2030, according to the consumer digital economy.
• By 2025, Grant Thornton predicts that e-commerce in India would be valued US$ 188 billion.
• India overtook Canada as the eighth-largest e-commerce market in 2020, surpassing France’s $50 billion in sales.
• The Indian E-commerce sector is predicted to rise by US$ 38.5 billion in the year 2017 to US$ 200 billion by 2026, fueled by growing smart phone penetration, the arrival of 4G, and increasing consumer income.
• In 2020, India will have 140 million of the world’s biggest internet shoppers, behind only China and the United States.
• Even before the rollout of next-generation mobile broadband systems in India, Indian customers are rapidly buying 5G handsets.
• In 2021, there were 169 million smart phones shipped, and 5G shipments grew by 555 percent year-on-year. Even before the rollout of next-generation mobile internet technology in India, Indian customers are rapidly buying 5G handsets.
• There were 150 million smart phones shipped and 4 million smart phones shipped in 2020, spurred by increasing customer demand after the lockdown. Indian web users are predicted to reach around 900 million by the year 2025 from 622 million in 2020, expanding at a CAGR over 45 percent through 2025, according to a research by IAMAI & Kantar Research.
• Indian e-commerce platforms achieved US$ 9.2 billion in gross merchandise value during the 2021 Christmas season, a rise of 23% over the previous year’s US$ 7.4 billion.

Government Initiatives

• For the last two years, the Indian government has launched a series of programs aimed at improving the country’s economy and promoting entrepreneurship. E-commerce development in the nation is anticipated to be supported by the timely and successful execution of these schemes.
• The Indian government has made a number of steps to encourage e-commerce, including the following:
• Government e-Marketplace (GeM) serviced 9.04 million orders worth Rs 193,265 crore to 58,058 customers from 3.79 million sellers and service providers registered as of February 15, 2022.
• Government e-Marketplace (GeM) platform served 7.96 million orders from 3.06 million registered vendors and service providers as of November 2, 2021, according to the latest data available.
• 78 million orders price Of rs. 145,583 crore to 54,962 customers were processed by the Government e-Marketplace site (GeM) on October 11, 2021, via 2.92 million registered vendors and service providers.
• The Open Network for Digital Commerce (ONDC) will reportedly be used by the (DPIIT) to establish protocols for cataloguing, vendor discovery, and price discovery in order to systematize the on-boarding process for retailers on e-commerce platforms.
• All market participants should have equitable access to the e-commerce ecosystem so that it may be used to its full potential in service of the nation and its people.
• The Indian government raised the restriction on foreign direct investment (FDI) in the E-commerce marketplace model from 50 percent to 100 percent in order to attract more international firms (in B2B models).
• Investing heavily in a fiber network for 5G would help India’s e-commerce industry grow.

Future of E-commerce industry in India

• Directly benefiting India’s small and medium-sized companies (MSME), the e-commerce sector has had a positive cascading impact on other sectors as well. The Indian E-commerce market is predicted to overtake the United States by 2034 and become the world’s second-largest E-commerce market.
• Customer engagement & digital advertising are expected to be bolstered by technology-enabled innovations such as digital payments and hyper-local logistics.
• Additionally, as the E-commerce market expands, it will enhance employment, export earnings, tax collections by exchequers, and consumer satisfaction. The number of people using smart phones is predicted to climb by 84% by 2022, reaching 859 million people worldwide.
• The e-commerce sector in India is predicted to develop at a CAGR of around 35 percent to reach Rupees. 1.8 trillion in FY20, according to a recent report. The internet Gross Merchandise Value is expected to reach US$ 100 billion by 2025 as the Indian e-retail business surpasses 300-350 million customers during the next five years.
• Approximately US$2 billion in social commerce GMV is expected in India by 2020, according to a research by Bain & Company. Due to growing mobile use, it is forecast to reach around US$ 20 billion in 2025, and by 2030, it might reach US$ 70 billion.