In what could be considered as a startling fact, the Indian e-commerce market has managed to surpass all our expectations and has managed to grow by 209 percent over the last five years. From $4.4 billion (Rs 20,020 crore) in the year 2010 to $13.6 billion (Rs 83,096 crore) in 2014, the e-commerce sector has been able to record these figures despite the fact that the country’s use of internet is much lower than many other poorer countries.
The data was made public in a reply given to the Lok Sabha recently. Further, according to a January 2016 report of Associated Chambers of Commerce & Industry of India, the Indian e-commerce market can be expected to surpass the $38 billion mark (Rs 252,700 crore) by this year end.
Another report by Confederation of Indian Industry (CII) and Deloitte, a consultancy firm, reveals that the Indian online retail sector will be a monstrous 1 trillion (Rs 660,000 crore) market by the end of year 2020 and this growth in the e-commerce will lead to big-big innovations taking place in the Indian market.
Further, the report also talked about how the Goods and Services Tax bill, once implemented, will be boosting the growth of e-commerce sector as it would simplify the taxation and logistics by a great deal.
Though India’s Internet penetration has been on a rise, but it is much less when compared to the rest of the world. There were approximately 354 million internet users as of September last year. Online shoppers in the country have also seen a significant 95 percent jump from 20 million in the year 2013 to 39 million in the year 2015.
Further, another major problem with internet in India is the speed constraint. According to IndiaSpend, the average broadband speed in the country is 2 mega bits per second (mbps), which makes it ranking a poor 115 on a global level.
Recently, the Indian government had has allowed 100% foreign direct investment (FDI) in online retail marketplaces-electronic platforms that connects sellers and buyers.
According to experts predictions, this growth in online e-commerce will spur the competition scene in the Indian online market, and this would further lead to a lot of international competitors stepping in and the domestic online retailers taking the brunt as a result of this. Recently, US based online retailer Amazon has taken over the second position in the largest online marketplace by shipments in India last month from Snapdeal, pushing it to a sad third place. The first position is being currently held by Flipkart.
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