E-commerce sector revenue to reach $120bn by 2020

The Dollar Business Bureau

Driven by the rising penetration of internet, demographic dividend and better economic growth, the e-commerce sector in India is estimated to reach $120 billion by 2020 from $30 billion at the end of 2015-16.

“The country’s e-commerce revenue is expected to surge from $30 billion in 2015-16 to $120 billion in 2020, at an annual growth rate of 51 percent, the highest in the world,” said a joint study by ASSOCHAM-Forrester.

The study pointed out that India may be behind China and other e-commerce giants such as Japan, in terms of base, however, the country’s growth rate is relatively higher than others.

Compared to India’s e-commerce sector’s annual growth rate of 51 percent, China’s industry is witnessing 18 percent growth, Japan is growing at 11 percent and South Korea has 10 percent growth rate the study added.

With 25 million internet users added every year, India is way ahead of BRICS countries like Brazil and Russia. It has a 400 million internet user base in 2016, compared to Brazil’s 210 million and Russia’s 130 million, the report noted.

Having one of the youngest demographic profiles in the world, about 75 percent of online users are in the age group of 15-34 years, the study said.

Therefore, it is not startling to see that the focus of the growth was on the young users in the last one year, added the study.

The study said that online travel has witnessed growth in almost all subcategories comprising airlines, car rentals, hotels and information and travel review sites. One, out of 5 users, visits the Indian Railways website.

Around 60-65 percent of the combined e-commerce sales in India took place via smart phones and tablets. The big hits on the online shopping list are branded apparels, accessories, gifts, jewellery and footwear, it added.