The financing, technology and training. Advent of

The Indian economy has
been regularly showing good signs of development, with the average GDP growth
rate at 7.5% in 2015-16. The retail sector is showing a encouraging development
of 11% CAGR, rising from an estimated size of USD 600 Billion now to USD 1
Trillion in 2024. Although, currently the total e- Commerce spend in India
accounts for less than 2% of the total retail spending, e-Commerce has become a
key driver to create different markets in erstwhile inaccessible geographies.
The Indian consumers are quickly advancing towards adopting technology. While
the overall tele-density is 81.8%, the mobile tele- density is also high at
79.8% as of November, 20155. Additionally, during the same time, India beat the
United States of America to become the 2nd largest market after China, for
smartphones with 220 Million users – This was attributable to the availability
of highly inexpensive smartphones and with easy-to-use features which helped
first-time smartphone users leapfrog from the desktop/laptop phase. Internet
penetration is also significantly rising with the number of internet users at
354 Million as of September,2017. In addition, there is a shift in mobile usage
from voice to data. Mobile internet spend has risen from 54% to 64% from 2014
to 2015. This is due to an accessibility of high-speed 3G & 4G internet
connectivity at reasonable prices which has led to an growth in transactions
done via mobile.


rank for ease of doing business went up by 12 in just one year due to an enhanced
regulatory framework thus creating a conducive business-friendly environment.
These factors have positively impacted Private Equity and Venture Capital
investments into the country touching USD 20 Billion in 2019. Majority of these
investments have been in e-Commerce industry. The e-Commerce industry is likely
to form the largest part of the Indian Internet market with a value of
approximately USD 100 Billion by 2028. In addition to transforming and
revolutionising the retail sector in India, it is also facilitating MSMEs to
jump the development loop by providing means of financing, technology and
training. Advent of technology enabled innovations such as Digital Payments,
Hyper-local Logistics, Analytics focused Customer Engagement and Digital
Advertisements have enabled the e-Commerce industry to grow at a much faster

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Within the e-Commerce
industry, the Gross Merchandise Value (GMV) is an important metric for
valuations especially during the early stages of growth. The majority of B2C
e-Commerce companies, globally, despite being operational for 5-20 years,
report low profitability. The situation in India is no different i.e. a growing
GMV but at an overall loss as the e-Commerce companies establish themselves.
The GMV for B2C segment in India was approximately USD 16 Billion in 2015. This
trend however does not hold true for the B2B e-Commerce companies which are
profitable with greater GMV values. The Indian B2B e-Commerce market potential
was valued at USD 300 Billion in 2014, and is expected to reach USD 700 Billion
by 202011. The higher profitability in the B2B segment is attributed to reasons
such as lack of heavy discounts, greater emphasis on quality rather than on
price, and higher volumes of purchases.


Total online spending, inclusive of
domestic and cross border shopping, is likely to increase by 31 per cent
year-on-year to Rs 8.76 trillion (US$ 135.8 billion) by 2018. Cross border
shopping by Indians touched Rs 58,370 crore (US$ 9.1 billion) in 2016, and is
expected to by 85 per cent year-on-year in 2017. The top 3 countries preferred
by Indians for cross-border shopping in 2016 were USA (14%), UK (6%) and China


The Indian consumer internet market is
expected to grow by 44 per cent year-on-year to touch US$65 billion in 2017, up
from US$45 billion in 2016. Online travel agents account for the largest market
share (70 per cent) in the internet consumer market, while the remaining 30 per
cent is engaged by horizontal e-tailing, fashion, furniture, grocery, hotel,
food tech, cab aggregators, education technology, and alternative lending among

The internet industry in India is likely
to double to reach US$ 250 billion by 2020, growing to 7.5 per cent of Gross
Domestic Product (GDP), with the number of mobile internet users growing to
about 650 million and that of high-speed internet users reaching 550 million.5
About 70 per cent of the total automobile sales in India, worth US$ 40 billion,
are expected to be digitally influenced by 2020 as against US$ 18 billion in