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India E-commerce Market

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Author

Geetanshi Chugh

Published On

Oct 2025

Product Code

KRR13

Base Year

2024

India E-commerce Market

Macroeconomic Indicators

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Summary

The India E-commerce market is segmented by by product categories (online retail, online travel, online food and grocery delivery, online matrimony and classified, other online services). Factors such as rising internet penetration rate, rise in adoption of omnichannel, increased market potential of Tier I, II, III cities, increasing Foreign Direct Investments (FDI), introduction of web content in local languages are leading the growth of India E-commerce market.

Market Overview

India E-Commerce Market Highlights

The India e-commerce market reached INR 12,739.20 billion in FY’23, recording a CAGR of 38.8% during the historic period FY’18–FY’23. The annual growth rate of the market in 2023 stood at 43.5%. Furthermore, the market is expected to reach INR 62,280.70 billion by 2029, growing at a CAGR of 30.3% during the forecast period FY’23–FY’29. Major players in the Indian e-commerce market include Amazon, Flipkart, Zomato, JioMart, Bharat Matrimony, MakeMyTrip, Info Edge, and EaseMyDeal. The market’s growth is being driven by the rising internet penetration rate, increased adoption of omnichannel strategies, expanding market potential across Tier I, II, and III cities, growing Foreign Direct Investments (FDI), and the introduction of web content in local languages.

India E-Commerce Market Definition

India E-Commerce Market: In this report, the India e-commerce market size is defined on its GMV (Gross Merchandise Value), which is calculated by considering total value of goods and services sold over a given period of time through brand’s website or marketplace. The market is segmented by product categories (online retail, online travel, online food and grocery delivery, online matrimony and classified, other online services). The report encompasses all the players specified in above product category segmentation such as, Amazon, Myntra, Flipkart, Zomato, Swiggy, Jio Mart, Bharat Matrimony, Make My Trip, Goibibo, Info Edge, Ease My Deal, Soul Play and many more. Additionally, the report will analyze market future projections, industry analysis, key factors influencing India e-commerce market.

Online Retail: This segment comprises sale of electronics, apparel, personal care products, and books through an online portal.

Online Travel: This segment covers domestic air ticket booking, rail booking, international air ticket booking, hotel booking, bus/cab booking, and tour packages.

Online Food and Grocery: This segment consists of delivery of food items from various restaurants as also home delivery of grocery items.

Online Matrimony and Classified: Revenue generated from online job portals, real estate services, matrimonial websites, and automotive eservices fall under this segment.

Other Online Services: Other online services include online ticket bookings for entertainment as well as payment for DTH, telephone bills, electricity bills, etc.

Business-to-Business(B2B): This model refers to online businesses that deal with two or more firms/businesses. Major B2B websites in India include ‘Tradeindia.com’, ‘Indiamart.com’, ‘India.alibaba.com’, and ‘Amazondistribution.in’.

Business-to-Consumer(B2C): It is an online portal used by companies to sell products to consumers. Key B2C websites in India are ‘Just Dial’, ‘Click India’, and ‘Sulekha’.

Taxonomy

India E-commerce Market Ecosystem

The ecosystem of India's e-commerce market is vibrant and dynamic, characterized by a multitude of players offering a wide range of goods and services online. Key players such as Amazon, Flipkart, Zomato, Jio Mart, Bharat Matrimony, Make My Trip, Info Edge, and Ease My Deal dominate the landscape, driving innovation and competition. With diverse offerings spanning retail, food delivery, travel, and more, these major players shape consumer experiences and influence the trajectory of the e-commerce sector in India.

India E-Commerce Market Size (by Value, in INR Bn), 2018-2023

The year-on-year growth rate for each year ranges from 37.7% in 2019 to 43.5% in 2023, indicating that the pace of growth has accelerated in recent years. The market has grown exponentially over the past five years due to the surge in internet and smartphone users, improved policy reforms, and an increase in disposable income. India has a vast and diverse consumer base, including urban and rural populations, and e-commerce companies are increasingly targeting the untapped potential in tier II, tier III cities, and rural areas to expand their reach.

India E-commerce Market Industry Analysis

Online retail market size and growth forecast (2020 – 2028e) in INR Bn

In 2022, the Indian online retail market was valued at INR 5,504.10 billion and is projected to reach INR 20,608.18 billion by 2028, growing at a robust CAGR of approximately 22.54%. This remarkable growth is primarily driven by the increasing adoption of internet-enabled devices and the convenience offered by online shopping. Factors such as diverse payment options, attractive cashbacks, and frequent discounts have further enhanced consumer engagement across digital platforms. Leading players like Amazon India, Flipkart, Snapdeal, Myntra, and Nykaa E-Retail Pvt. Ltd. continue to dominate the market landscape, leveraging innovation and customer-centric strategies. Overall, the sector’s rapid expansion reflects the evolving needs and preferences of Indian consumers in an increasingly digital and connected retail environment.

Online travel services’ market size and growth forecast (2020-2028e) in INR Bn

India's online travel services market, valued at INR 1,226.63 billion in 2022, is projected to reach INR 8,085.69 billion by 2028, growing at a CAGR of approximately 34.89%. Improved air and rail connections between tier I and tier II cities have led to a surge in domestic travel bookings, predominantly on online platforms. Factors such as mergers, partnerships, alliances, increased international tourist visits, and the widespread adoption of online payment platforms are propelling the growth of the online travel market. Additionally, a notable shift toward mobile-based transactions is evident, with a significant portion of bookings now occurring through mobile apps in the Indian online travel sector.

Online food and grocery delivery market size and growth forecast (2020 – 2028e) in INR Bn

The online food and grocery delivery market in India was valued at INR 1,116.55 billion in 2022 and is projected to reach INR 4,659.46 billion by 2028, growing at a CAGR of around 48.62% between 2023 and 2028. The rise in income among India's middle-class population has been a key driver for the expansion of the online food delivery industry. Additionally, increased internet and smartphone usage, coupled with rapid lifestyle changes, have significantly contributed to the market's growth. Online grocery platforms are also gaining popularity due to growing consumer awareness, improved digital literacy, and enhanced internet accessibility across the country.

Online matrimony and classified market size and growth forecast (2020 – 2028e) in INR Bn

As of 2022, the Indian online matrimony and classified market was valued at INR 309.02 billion and is expected to reach INR 1,871.57 billion by 2028, growing at a CAGR of approximately 33.04% from 2023 to 2028. Online classifieds encompass various categories such as job portals, real estate, matrimony, and automotive e-services. Tech-savvy consumers increasingly prefer online classifieds due to their convenience and effectiveness in finding desired results. Key players in the digital classified market in India include Quikr, Sulekha, Just Dial, naukri.com, OLX, and Click India.

Other online services’ market size and growth forecast (2020 – 2028e) in INR Bn

Online services in India include booking tickets for entertainment, DTH recharges, and paying bills for services such as telephone, electricity, water, and insurance. The revenue in this sector is projected to reach INR 720.03 billion by the end of 2022 and INR 5,461.69 billion by the end of 2028, growing at a rate of about 37.96% from 2023 to 2028. Advancements in technology within the banking, financial services, and insurance (BFSI) industry in India have led to increased use of digital financial services and wallets nationwide. Furthermore, all financial institutions are encouraging the use of e-financial services to ensure streamlined and efficient operations.

Rising internet penetration rate

Over the period from 2007 to 2022, India has experienced a significant upward rise in Internet Penetration Rate, marking a substantial increase from 4% in 2007 to 48.7% in 2022. This progressive trend underscores the country's evolving digital landscape, with notable strides in connectivity and online accessibility, reaching a pivotal milestone in 2019 when the Internet Penetration Rate reached 50%. As more individuals gain access to the internet, a larger consumer base emerges, fostering widespread online shopping adoption. Improved connectivity empowers users in remote areas, facilitating their participation in the digital economy. This surge in online accessibility not only broadens the customer base but also creates a conducive environment for e-commerce businesses to thrive, leading to sustained growth in the Indian e-commerce sector.

Omnichannel on Consistent Rise

As companies adopt omnichannel solutions to meet customer needs, they are increasingly using stores to fulfill online orders, helping brands deliver faster and enhance the overall shopping experience. In the past fiscal year (FY 2023), there was a significant 44.6% increase in orders being shipped directly from stores. Simultaneously, the number of stores using omnichannel technology witnessed substantial growth of 58.4% during the same period. This shift highlights a positive trend where businesses are efficiently blending their online and in-store capabilities to better serve customers.

Tier I Cities Constitute the Highest Market Share; Tier II & Tier III Towns Showcase Enormous Potential

As things return to normal, traditional markets are regaining momentum, with Tier I cities leading the way. In these cities, the number of orders has increased at a faster rate compared to smaller cities. Tier I cities recorded a 31.1% jump in orders from the previous year, while Tier II and Tier III cities experienced growth rates of 23.3% and 22.4%, respectively. Many people have returned to metropolitan and Tier I cities for work as offices resumed operations, which has further boosted business in these top-tier cities, making them stand out in terms of order growth.

Increasing foreign direct investment (FDI)

Increasing FDI in the Indian e-commerce market will help domestic players expand their e-commerce businesses. In August 2018, Walmart acquired a 77% stake in Flipkart and entered the Indian e-commerce market. The entry of Walmart into the Indian market will aid the economy in many ways, particularly by creating around 10 million jobs in the coming years. Moreover, Walmart has a history of sourcing more than 90% of its goods locally from the countries in which it operates its e-commerce business, thereby benefiting local sellers. Apart from Walmart, other major investors in the market include SoftBank, Tiger Global, Sequoia Capital, Bessemer Venture Partners, and Nexus Venture Partners. With the increasing participation of foreign players in the Indian e-commerce market, competition is expected to intensify, leading to the overall development of the market space. In 2020, despite the impact of COVID-19, India registered a 13% growth in FDI, at a time when fund flows declined significantly in major economies such as the UK, the US, and Russia.

Web content in local languages

In 2021, about 833.71 million people were using the internet in India. Liv.ai, a startup specializing in AI-based speech recognition, partnered with Flipkart to enhance the conversational shopping experience. In September 2019, Flipkart introduced a ‘Hindi’ interface to attract 200 million customers from smaller cities. Similarly, Amazon launched its e-commerce site in Hindi in 2018, making product details and discounts accessible in the language. Recognizing that people prefer local languages, companies plan to offer web content in regional languages, aiming to broaden the customer base of the e-commerce market.

COD and Prepaid Order Returns in %, FY’22 & FY’23

In 2023, there was a slight increase in the percentage of Cash-on-Delivery (COD) orders returned by customers, rising from 19.3% in 2022 to 20.9%. On the other hand, the return rates for prepaid orders remained mostly steady, with a small increase from 5.6% in 2022 to 5.8% in 2023. The overall distribution of COD and prepaid orders remained unchanged, with 60% of total returns being COD and 39% for prepaid. Interestingly, this pattern stayed consistent across both years, indicating that COD orders consistently accounted for more than 60% of returns, while prepaid orders made up around 39% of returns.

Legal Barriers

In December 2018, the Department of Industrial Policy and Promotion (DIPP) introduced new Foreign Direct Investment (FDI) rules for e-commerce players in India. Amazon and Flipkart, two major e-commerce players, were unexpectedly affected by these regulations, potentially hindering the rapid 40% annual growth of the online retail industry in India. The Indian government allowed 100% FDI in the marketplace model but not in the inventory-based model of e-commerce. Stricter regulations were imposed on foreign-owned e-commerce marketplaces (ECMs) following complaints from vendors and traders. The changes included restrictions on ECM-owned businesses selling products on the same portal, a 25% cap on sales by a single vendor, and limitations on exclusive partnerships and preferential services. Additionally, ECMs are now prohibited from influencing product sale prices, which has impacted seasonal sales promotions by companies such as Amazon and Flipkart. As a result, revenue growth for these companies is expected to be negatively affected since they own businesses like Cloudtail Retail, Appario, WS Retail, RetailNet, and Omnitech Retail.

The Ministry of Commerce and Industry launched the Government E-Marketplace (GeM), an online platform for public procurement in India, on August 9, 2016, with the goal of creating an inclusive, effective, and transparent platform for buyers and sellers to conduct procurement activities in a fair and competitive manner. The value of products and services purchased through the government portal in FY 2023 exceeded INR 2 trillion. As of November 2022, the GeM portal had served 12.28 million orders valued at INR 3.35 trillion from 5.44 million registered vendors and service providers for 62,247 buyer organizations. The Make in India program, launched in 2014, is intended to develop the industrial infrastructure in India. The Draft National E-Commerce Policy of the Government of India encourages FDI in the marketplace paradigm of e-commerce and further states that the FDI policy for the e-commerce sector was created to ensure a level playing field for all participants. Udaan is a business-to-business (B2B) internet trading network that connects small and medium-sized manufacturers and distributors with online merchants while also assisting them with logistics, payments, and technology. The marketplace has retailers in over 80 Indian cities and delivers to over 500 cities. Additionally, the Start-up India program, announced by the Indian government in August 2015, has introduced a strong ecosystem for nurturing start-ups. The government has provided support through funds such as the Fund of Funds (with a corpus of INR 100 billion) and Startup India Hub, which serves as a single point of contact for the start-up ecosystem.

India E-Commerce Market Segmentation

India E-Commerce Market Segmentation by Product Categories (in %), 2022

Online Retail: The online retail product category holds the highest market share of 62.01% in India e-commerce market. This category includes Apparels, Footwear, Consumer Electronics, Jewelry, Home Décor, Toys and Games, Baby Care Products etc. E-commerce platforms provide access to a vast array of products and brands, giving consumers more choices than traditional retail stores.

Online Travel: Following closely behind is the online travel segment, capturing 13.82% of the market. This signifies the continued importance of online platforms for booking flights, hotels, and travel packages.

Online Food & Grocery Delivery: This segment grabs significant 12.58% share, reflecting the growing trend of online grocery shopping and food delivery, driven by convenience and changing lifestyles.

Online Matrimony & Classified: This category holds a smaller share of 3.48%, showcasing the niche presence of online matrimonial and classifieds platforms in the e-commerce landscape.

Other Online Services: The remaining 8.11% encompasses a diverse range of online services like online ticket bookings for entertainment, direct to-home (DTH) recharges, telephone bills, electricity bills, water bills, insurance premium payments, and net banking.

India E-Commerce Market Future Outlook

The market size for the Indian e-commerce market is expected to reach a staggering INR 62,280.7 billion by FY’29, indicating a substantial increase from the current figure of INR 12,739.2 billion in FY’23. The year-on-year growth rate for the market is projected to remain high throughout the period, ranging from 39.7% in 2024 to 24.5% in FY’29. This signifies a consistent upward trajectory, even though the growth rate might gradually taper off in the later years. The compound annual growth rate (CAGR) for the entire period is estimated to be 30.3%, further emphasizing the robust and sustained growth potential of the Indian e-commerce market.

Company Profile of Major Companies in India E-Commerce Market

Company Name	Establishment year	Description
Amazon India Limited	1994	Amazon.com, Inc. is an American multinational technology company focusing on e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence. It is considered one of the Big Five American technology companies, alongside Alphabet (parent company of Google), Apple, Meta (parent company of Facebook) and Microsoft.
Flipkart Internet Private Limited	2007	Flipkart Private Limited is an Indian e-commerce company, headquartered in Bangalore, and incorporated in Singapore as a private limited company. The company initially focused on online book sales before expanding into other product categories such as consumer electronics, fashion, home essentials, groceries, and lifestyle products.
Nykaa	2012	Nykaa is an Indian e-commerce company headquartered in Mumbai. It sells beauty, wellness and fashion products through its website, mobile app, and over 100 physical stores.[4] In 2020, it became the first Indian unicorn startup headed by a woman.
Zomato Limited	2008	Zomato is an Indian multinational restaurant aggregator and food delivery company. Zomato provides information, menus and user-reviews of restaurants as well as food delivery options from partner restaurants in more than 1,000 Indian cities and towns, as of 2022–23. Zomato has 12,000 restaurant partners and more than 1.4 million eateries listed. Additionally, Zomato Gold has approximately 6500 restaurant partners in India Zomato rivals Swiggy in food delivery and hyperlocal space.
BigBasket	2011	BigBasket is an Indian online grocer headquartered in Bangalore, India, and currently owned by Tata Digital. It was the first online grocer in India, set up in 2011. It is a registered company with name as the Supermarket Grocery Supplies Pvt. Ltd. As of January 2023, the company operates in more than 30 cities in India and processes around 15 million orders per month.
Indiamart	1996	Indiamart is India's largest online B2B marketplace, connecting buyers with suppliers. The online channel focuses on giving buyers and sellers a platform of exchange, these can be individuals, SMEs, or big businesses. Indiamart has a large and diverse customer base, ranging from small businesses to large corporations, and covers a wide range of industries including manufacturing, construction, and agriculture. The platform has over 100 million registered buyers and over 6.5 million suppliers listed on its platform. Indiamart has also been expanding its services to include value-added services such as payment processing, logistics support, and marketing services. The company has also launched a mobile app to make it easier for businesses to connect on-the-go.
Uber Technologies	2009	Uber Technologies, Inc., commonly referred to as Uber, provides ride-hailing services, food delivery, and freight transport. The company is headquartered in San Francisco and operates in approximately 70 countries and 10,500 cities worldwide. The company has over 131 million monthly active users and 6 million active drivers and couriers worldwide and facilitates an average of 25 million trips per day. It has facilitated 42 billion trips since its inception in 2010 and is the largest ridesharing company in the United States.
Bharat Matrimony	1959	BharatMatrimony is an online matrimonial service and a part of Matrimony.com. It was founded in 2000 by Murugavel Janakiraman, who later met his wife through his own matrimonial site. The company has 130 offices in India, with offices in Dubai, Sri Lanka, United States and Malaysia to cater to customers beyond India.

India E-commerce Market Macroeconomic Indicators

India's population was around 1,437 million in 2023, increasing by 30 million from 1,407 million in 2021. By the end of 2025, India's population is predicted to reach 1,500 million.

In the year 2020, The population between the 25-49 age group is the largest age group (36.40%)  in India followed by 0-14 (26.40%), 50+ (19.40%), and 15-24 (18%).

In 2023, India's GDP was valued at USD 3732 billion, up from USD 2710 billion in 2018. The country’s GDP is expected to reach 5000 billion by the end of 2025.

In 2023, India’s Inflation rate stands at 5.66 % an increase of approximately 2.5% from the 2018 inflation rate of 3.94%. During the COVID-19 pandemic in 2020, the inflation rate in India surged unexpectedly to 6.62% from 3.72% in 2019.

As of 2023, India comprises of majority of the middle-class population which is 57% of the total population of India. After the middle class comes the lower-class category which comprises 33% of the total population of India. The remaining 10% of the population belongs to a high-income class.

1.1. Market Highlights

1.2. Market Definition

1.3. Taxonomy

2.1. Ecosystem of Major Entities involved in India E-Commerce Market

2.2. Ecosystem of Major Players by Product Category

4.1. E-Commerce Market Share Based on Product Categories in %, 2022

5.1. Company Profile of Major Companies in India E-Commerce Market

5.2. Competitive Benchmarking of Players in India E-Commerce Market

5.3. Website Benchmarking of India E-commerce Market

6.1. Market Size of Product Categories in India Ecommerce Market

6.2. Growth Drivers of India E-Commerce Market

6.3. Major Challenges in India E-Commerce Market

6.4. Trends in India E-Commerce Market

7.1. Tier Wise order volume growth Post Covid of India Online Retail Market in %, FY’23

7.2. Tier Wise Market Share of India Online Retail Market in %, FY’22 & FY’23

7.3. Order volume & GMV Growth across different E-commerce Categories of India Online Retail Market in %, FY’23

7.4. Brand Website and Marketplace growth of India Online Retail in %, FY’23

7.5. Brand Website and Marketplace growth Across different E-Commerce Categories of India Online Retail Market in %, FY’23

8.1. Mergers and Acquisition in India E-Commerce Market, 2022

11.1. Population of India (2018-2023)

11.2. India GDP and Inflation Rate (2016-2021)

11.3. India Currency Exchange Rate (2017-2021)

11.4. Population Based on Age Group in India 2010-2025

11.5. Population of India by Income Class, FY’23

Disclaimer

India E-Commerce Market Frequently Asked Questions

Frequently Asked Questions

India E-commerce Market

Author

Pages

Published On

Product Code

Base Year

Summary

Market Overview

India E-Commerce Market Highlights

India E-Commerce Market Definition

Taxonomy

India E-commerce Market Ecosystem

India E-Commerce Market Size (by Value, in INR Bn), 2018-2023

India E-commerce Market Industry Analysis

Online retail market size and growth forecast (2020 – 2028e) in INR Bn

Online travel services’ market size and growth forecast (2020-2028e) in INR Bn

Online food and grocery delivery market size and growth forecast (2020 – 2028e) in INR Bn

Online matrimony and classified market size and growth forecast (2020 – 2028e) in INR Bn

Other online services’ market size and growth forecast (2020 – 2028e) in INR Bn

India E-Commerce Market Segmentation

India E-Commerce Market Segmentation by Product Categories (in %), 2022

India E-Commerce Market Future Outlook

Company Profile of Major Companies in India E-Commerce Market

India E-commerce Market Macroeconomic Indicators

India E-Commerce Market Frequently Asked Questions