Indian E-commerce to Reach $550 Billion by 2035: Report
E-commerce is transforming India's retail industry, according to a joint report by ANAROCK and ETRetail. The report projects that Indian e-commerce will grow at a CAGR of 15%, reaching $550 billion by 2035. In 2024, the sector was valued at $125 billion and is expected to hit $345 billion by 2030.
This growth is driven by rising internet penetration, increased smartphone usage, a robust digital payment ecosystem, and a tech-savvy young population. Government initiatives like Digital India and advancements in logistics and supply chain networks have further accelerated the sector’s expansion.
“Besides the metros, e-commerce players are also tapping the growing demand from smaller towns and cities. Resultantly, the share of online shoppers from Tier 2 and 3 cities has increased to 56% in FY2024 from 46% in FY2020, and is expected to reach 64% by FY2030," says Anuj Kejriwal, CEO & MD – ANAROCK Retail. “Meanwhile, the overall Indian retail industry's market size is expected to touch USD 2,500 Bn by 2035, witnessing a three-fold increase compared to 2019. The report states that this growth is powered by rising disposable incomes, increasing urbanization, a young and tech-savvy population, and an ever-expanding middle class. Today, the industry is defined by sprawling malls and thriving e-commerce alongside traditional bazaars.”
" New mall supply across the top 7 cities was a mere 1 Mn sq. ft. in 2024, while absorption stood at 6 Mn sq. ft.,” says Anuj Kejriwal. “New supply is lagging far behind demand. Current supply and demand trends for mall spaces indicate a post-pandemic rebound in leasing, now largely driven by experiential retail. Apparel and the F&B sectors consistently contribute nearly 45% of demand, remaining the top footfall drivers. Also, post-COVID, the mall vacancy rate has declined from 15.4% in 2019 to 8.1% in 2024," he added.
The report highlights that major domestic and international retailers have ambitious plans to increase their footprint in India's smaller towns and cities, resulting in a surging supply of malls in tier 2 and 3 markets which will, potentially, account for over 26 million sq. ft. of mall spaces by 2030.
