India is on track to become the second largest e-commerce market in the world by 2034, led by increased internet penetration, according to Akshay Gulati, Co-founder of Shiprocket – a logistics software company. India is currently ranked number 9 globally. “By 2030, about 1.3 billion Indians will have access to the internet and smartphones, with over 500 million online shoppers,” he said in an interactive session on day 1 of the 2-day Phygital Retail Convention.
The Indian market size is expected to be $60 billion by 2027, with over 800 brands in the direct-to-customer (D2C) segment. He said that from a customer perspective, online adoption has accelerated a lot in the last two years.
Gulati added that there is no restriction on information flow today, and trends don’t take 6 to 12 months to materialize. They happen overnight. E-commerce penetration is expected to almost double (to 15%) in India by FY2027, from 8% in FY2022. And the rising domestic e-commerce market will also open doors for Indian manufacturers, to top the global market with the D2C segment gaining momentum.
India’s post-pandemic exports are already at a record high. The total merchandise exports stood at 105 billion USD during the third quarter of FY 2021-22. Through the digital mode, the paradigm in consumption and spending has been repositioned, turning the brick-and-mortar mall infrastructure into experience centers.
With the introduction of 5G network and the rising per capita income, India’s merchandise retail will undergo a paradigm shift in the next decade.
Speaking at the inaugural session of the convention, Arvind Singhal, Chairman at Technopak, said, “the biggest transformation in Indian retail will be Open Network for Digital Commerce, with 5G network penetrating and facilitating product discovery a lot faster.”
He added, “consumption and spending patterns will be more digital. It will not be limited to offline retail stores. India’s per capita consumption will cross the $5,000 hurdle in the next decade, from $2,000 as of now. Then, the discretionary spending will rise as the country’s merchandise retail rises to $1.8 trillion, from $800 billion now.”
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