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Home»Business»India’s e-retail market overtakes US with $60 billion size but growth halves in 2024: Here’s why | Business News
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India’s e-retail market overtakes US with $60 billion size but growth halves in 2024: Here’s why | Business News

April 15, 2025No Comments3 Mins Read
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Whilst India has emerged as a key marketplace for e-commerce, with the sector surging to roughly $60 billion in gross merchandise worth (GMV), boasting the world’s second-largest on-line shopper base, progress on this phase final 12 months halved to 10-12 per cent in comparison with historic progress charges of 20 per cent, in response to a report by Flipkart and Bain & Firm.

Nonetheless, regardless of near-term macroeconomic headwinds, the long-term prospects stay robust, the report mentioned. Three key disruptions, fast commerce, trend-first commerce (particularly in style), and hyper-value commerce, will outline the following chapter of progress, it added.

The slowdown, and anticipated rebound

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India’s consumption and discretionary spending have confronted headwinds lately, with personal consumption progress slowing from 11 per cent within the pre-Covid (2017–19) interval to round 8 per cent post-Covid (2022–24), the report mentioned.

“This decline is pushed by increased inflation and a stagnation of actual wages. The stress in consumption is obvious in e-retail progress in 2024 being 10–12 per cent, in comparison with historic progress charges of over 20 per cent,” it added.

Nonetheless, the latest fiscal and financial coverage interventions are anticipated to drive a rebound in e-retail progress, particularly from the festive interval of 2025, on account of revival within the consumption cycle, the report mentioned.

The e-retail market is predicted to scale to $170–190 billion by 2030, rising at over 18 per cent yearly. Almost 1 in 10 retail {dollars} is projected to be spent on e-retail by 2030, fueled by an uptick in discretionary spending as India’s GDP per capita crosses the essential $3,500–4,000 threshold, a key tipping level noticed in e-retail spending globally, the report mentioned.

The disruption

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Excessive-frequency classes akin to grocery, life-style, and common merchandise will drive e-retail progress, accounting for 2 out of each three {dollars} spent on e-retail by 2030. These classes are set to see a two- to four-fold enhance in e-retail penetration over this era, per the report.

There has additionally been a change within the on-line procuring panorama in India. “Person adoption is already spreading from Tier-2 to Tier-3 cities, with three in 5 new customers since 2020 coming from cities designated Tier-3 or smaller. This progress is unlocking entry for shoppers in distant, brand-starved areas, as evidenced by the 1.2 occasions increased e-retail shopper penetration within the Northeast in comparison with the remainder of India. The vendor base can be diversifying, with 60 per cent of recent sellers since 2021 hailing from Tier-2 or smaller cities,” the report mentioned.

Fast commerce accounted for over two-thirds of all e-grocery orders and a tenth of total e-retail {dollars}, and is projected to develop at over 40 per cent yearly by way of 2030, pushed by enlargement throughout classes, geographies, and buyer segments.

Pattern-first commerce can be quickly gaining momentum in India. Pattern-first style alone is predicted to develop 4 fold, reaching roughly $8 to $10 billion by 2028, with greater than half of this income from on-line gross sales, the report mentioned.

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Hyper-value commerce — ultra-low worth assortment — has seen a worldwide surge, exemplified by the success of Temu within the US. In India, hyper-value commerce’s contribution to e-retail has scaled from round 5 per cent of e-retail GMV in 2021 to greater than 12 per cent in 2024. These platforms have gained robust traction amongst lower-middle-income shoppers, significantly in Tier-2 or smaller cities, by specializing in an inexpensive product assortment.



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billion business eretail Growth halves heres Indias market news overtakes size
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