‘India’s ecommerce market to cross 100 billion dollars by 2020’

India's ecommerce market is expected to breach the 100-billion dollars (over Rs 6,00,000 crores) mark by 2020, triggered by increasing internet usage, discounting and investment by online retailers, says a report by Goldman Sachs.

The overall online market, including travel, payments and retail, in the country could reach 103 billion dollars (over Rs 6,69,000 crores), the US investment bank said in a report this month, adding, the figure is a 27 percent jump from the 81 billion dollars (over Rs 5,26,000 crores) it estimated in May, this year. The majority of this upward revision is contributed by the etail segment, which is estimated to reach 69 billion dollars (over Rs 4,48,000 crores) by FY20 compared with 47 billion dollars (over Rs 3,00,000 crores) earlier.

“Higher growth in this space is due to the higher-than-expected internet and smartphone penetration, digital wallet adoption, last-mile logistics investments, continued discounting and better execution,” analysts Rishi Jhunjhunwala, Venkat Surapaneni and Piyush Mubayi wrote in the Goldman Sachs report.

The drivers to this revised estimate are launch of 4G service by Bharti Airtel in about 300 cities and Reliance Jio Infocomm’s plans to launch the high-speed data service in the fourth quarter of this fiscal, announcement by Taiwanese electronics maker Foxconn Technology Group that it plans to invest five billion dollars (over Rs 32,400 crores) in India over the next five years, while Uber said it will invest one billion dollars (over Rs 6,490 crores) in the country in six to nine months to expand and improve operations, according to the report. The Reserve Bank of India has also issued 11 payment bank licences, which are expected to further catalyse the e-payment landscape.