Report Overview

An increasing demand for online shopping among consumers, widespread use of smartphones for social media, and further deepening of internet penetration are expected to boost the growth of India E-commerce Market during the forecast period between 2024 and 2030.

India E-commerce Market - Industry Trends & Forecast Report, 2030

The India E-commerce Market size was estimated to be worth USD 225.32 billion in 2023. During the forecast period between 2024 and 2030, the India E-commerce Market size is projected to grow at a CAGR of 11.38%, reaching a value of USD 303.11 billion by 2030. Major growth factors for the India e-commerce Market include the increasing penetration of smartphones and the Internet and the increasing number of e-commerce platforms in the country. The e-commerce platform offers a wide range of products and services as well as heavy discounts to grab a share in a price-sensitive market such as India, which contributes to its market growth.

E-commerce – Overview

Electronic commerce, or e-commerce, is the online purchasing and selling of products and services. Through the e-commerce sector, users may buy their goods and services without physically visiting the business. The digital channel-based sale of physical goods to individual end users is included in the e-commerce sector (B2C). This definition covers purchases done with desktop, notebook, and laptop computers as well as mobile devices (e.g., smartphones and tablets). The eCommerce market (eCommerce and C2C) does not include digitally distributed services (see instead: eServices), media downloads or streaming, digitally delivered products in B2B marketplaces, or the digital purchase or resale of used, damaged, or repaired goods.

India E-commerce Market

Growth Drivers

Favorable Government Regulations and Policies

According to the India Brand Equity Foundation, India permits 100% FDI in B2B e-commerce. India is now the third-largest consumer market in the world, and the country's e-commerce market is largely driven by these advantageous government laws and policies, according to a Deloitte India report. Furthermore, the country's internet and smartphone usage has increased dramatically as a result of initiatives like "Digital India." The e-commerce sector is registering significant growth in tier-2 and tier-3 cities as a result of growing internet usage and the adoption of 4G and 5G technologies.

Challenges

Lack of Data Security and Privacy

Data security and privacy are two of eCommerce's primary drawbacks. Despite the presence of sophisticated data encryption security technologies, most individuals are reluctant to provide their personal and financial information. Furthermore, some websites lack the tools and functionality necessary for transaction authentication. Therefore, there are cases of dishonest behavior. eCommerce expansion is impeded by the fear of disclosing financial information, such as credit card numbers.

Impact of Escalating Geopolitical Tensions on India E-commerce Market

Intensifying geopolitical tensions negatively impact the growth of India E-commerce Market. For instance, China is India’s biggest trading partner, with an estimated USD 103 billion in bilateral commerce between April 2019 and February 2020; the primary imports are consumer products, including toys, furniture, textiles, and shoes. However, violent clashes between the two countries in 2020 resulted in trade retaliation from India, under which several Chinese apps were banned. India banned several Chinese e-commerce platforms as well, including Alibaba and Zhejiang-based Chinese e-commerce portal Club Factory, Shein, which affected the growth of the India E-commerce Market.

India E-commerce Market

Segmental Coverage

India E-commerce Market – By Type

Based on type, the India E-commerce Market is segmented into B2C and B2B. The B2C segment accounts for a larger market share. This segment is further classified into clothing & footwear, beauty & personal care, food & grocery, appliances & electronics, home improvement, and others. The clothing & footwear segment holds the largest share of the market owing to the convenience e-commerce platforms offer in accessing trendy products and providing their customers with heavy discounts. However, the beauty & personal care segment is also registering a high growth rate during the forecast period owing to the increasing popularity of platforms such as Nykaa and Purple in the country.

India E-commerce Market – By Payment

Based on payment, the India E-commerce Market is segmented into cash on delivery (COD), credit card, debit card, bank transfer, prepaid card, digital & mobile wallet, and other digital payment methods. The cash-on-delivery (COD) segment holds the largest share of the India e-commerce market. The lack of trust on online payment and hesitance to share sensitive financial information over the internet contribute to the growth of the COD segment. However, the digital & mobile wallet segment is anticipated to register a CAGR during the forecast owing to the increasing popularity of online payment platforms, such as Google Pay and PhonePe.

India E-commerce Market – By Sales Channel

Based on the sales channel, the India E-commerce Market is segmented into online and offline. The online segment accounts for a larger market share. The growth of the market is attributed to various factors, including flexibility for customers, customized user experience, and the ability to allow users to review before making a purchase. Online platforms are available around the clock and will enable customers to browse through a wide range of products. In addition, companies are also providing customized user experience through the integration of advanced technologies, such as big data, which is propelling the online segment’s market growth.

Competitive Landscape

Major players operating in the India E-commerce Market include Amazon India, Flipkart, Nykaa, IndiaMART, Meesho, FirstCry, BookMyShow, OLX, MakeMyTrip, and AJIO.

To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In May 2024 – Google invested USD 350 million in Flipkart, a major e-commerce platform in India, and agreed to offer cloud services as part of the deal.

Scope of the Report

By Type

• B2C

1. Clothing & Footwear

2. Beauty & Personal Care

3. Food & Grocery

4. Appliances & Electronics

5. Home Improvement

6. Others

• B2B

By Payment

• Cash on Delivery (COD)

• Credit Card

• Debit Card

• Bank Transfer

• Prepaid Card

• Digital & Mobile Wallet

• Other Digital Payment

By Sales Channel

• Online

• Offline

By Device

• Mobile

• Desktop