India E-Commerce Market Size

India E-Commerce Market Analysis

The India E-Commerce Market size is estimated at USD 112.93 billion in 2024, and is expected to reach USD 299.01 billion by 2029, growing at a CAGR of 21.5% during the forecast period (2024-2029).

One of the primary factors driving the market's growth is rapid urbanization. Additionally, rising internet penetration and devices such as smartphones, laptops, and tablets to access e-commerce websites boost the market's growth. E-commerce allows businesses to conduct business without maintaining a physical presence, saving money on infrastructure, communication, and overhead.

• The policies introduced by the Government of India, including 100% FDI in B2B E-commerce through the automatic route in the marketplace model of B2C E-commerce, are projected to boost the sector's growth. As per the new FDI policy, online entities, through foreign investment, cannot offer the products sold by retailers in which they hold an equity stake.
• According to the India Brand Equity Foundation (IBEF), the Indian government's Digital India effort aims to drive it into an online economy worth trillions by 2025. It has led to the formation of a new steering group to review and analyze the development of an e-commerce platform for the government.
• The commerce ministry has started a new committee to review the Open Network for Digital Commerce (ONDC) strategy. ONDC is an e-commerce platform that the government is supporting and aims to provide the final shop's infrastructure, which will resemble Flipkart and Amazon. Such developments are expected to drive the studied market.
• According to IBEF, by 2024, online retail penetration will reach 10.7%, up from 4.7% in 2019. Likewise, by 2025, India's internet buyers will number 220 million. According to a Payoneer report, India's e-commerce sector is ranked 9th in the world for cross-border growth. E-commerce in India is expected to grow from 4% of total food and groceries, fashion, and consumer electronics retail sales in 2020 to 8% by 2025.
• Expansion of e-commerce can raise competition in retail markets, increase consumer choice, and motivate and expedite product distribution innovation. However, several competition agencies' recent enforcement and advocacy work have revealed the possibility of anticompetitive behavior in the internet context. Concerns about potential market fragmentation are significant among many organizations that have looked into the topic of e-commerce competition.
• The pandemic-induced lockdown and mobility restrictions represented a significant point for e-commerce in India, driving demand to new highs, bringing new shoppers and sellers into digital platforms, and offering players long-term growth. Containment efforts introduced people to the convenience of online buying and motivated online buyers to buy more, making the Indian e-commerce business one of the significant beneficiaries of the pandemic.