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India to be the fastest growing E-Commerce Market in Asia-Pacific; Market Set To Grow to $8.8 Billion by 2016

According to the latest research by Forrester, a leading global research and advisory firm, the e-commerce market in India is set to grow the fastest within the Asia-Pacific Region at a CAGR of over 57% between 2012-16. The report, titled “Asia Pacific Online Retail Forecast, 2011 To 2016,” has been issued by Forrester Research Inc. Analyst Zia Daniell Wigder, with Steven Noble, Vikram Sehgal and Lily Varon.

The recently released report looks at growth in key e-commerce markets in the Asia-Pacific region, besides identifying key trends in each of the markets and projected market size by country over the next five years.

Forrester had written its first online retail forecast for the Asia Pacific region in October 2010. As per the company, since then, e-commerce in every market in the region has charged ahead, with growth continued unabated.

As per Wigder, “India will grow quickly off a small base. India’s eCommerce market, by far the smallest of those covered in the forecast, is poised to grow by more than five-fold by 2016 as the number of online buyers and per capita online spending increase rapidly. This market is gaining more attention as global brands look to markets that are in the early stages of eCommerce adoption but offer significant long-term potential.”

As per the report, while compound annual growth rates in the mature e-commerce markets of Japan, South Korea, and Australia will run 11% to 12% over the next five years, in the rapidly growing markets of China and India, these growth rates will be 25% and 57%, respectively.

The report also highlights the rapid growth of the e-commerce market in neighbouring China, where a CAGR of over 20% will take the market to over $350 billion. According to Wigder, “When the U.S. online retail market was roughly the same size as China’s is today, it was growing at a fraction of the pace.”

Forrester Research’s projections for Asia-Pacific e-commerce sales by country (in billions, in U.S. dollars), in 2012 and 2016.

The forecast notes e-commerce’s rapid growth in India, where sales are forecast to grow 57% annually through 2016. Wigder says e-commerce sales in India will surpass $1 billion for the first time this year and reach $8.8 billion by 2016. India’s e-commerce industry is set to grow on the back of rising demand from consumers and increasing penetration of technology. The report gives credence to the fact that E-Commerce in India is here to stay.

Forrester is a global research and advisory firm headquartered in Cambridge, Massachusets, and has over 1200 employees across 27 cities. The company has over 450 research professionals and serves over 2,600 clients with revenues in excess of $220 million. The company was founded in 1983 by George F.Colony who now serves as its CEO and Chairman of the Board.

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    India’s e-com industry is already greater than 8.8 bn dollars if you combine the sales on credit and debit cards, net banking, and other modes of online payment such as ITZ cash card etc. Over 75%of that is on travel I.e. online travel agents, irctc etc. I think the research is talking about non-travel related ecom revenue

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    I have been in the Supply chain Management industry for sometime. I do agree with the assumption of the article published.Now, in India becoz of the ITES industry in Cities especially in Bangalore we have noticed several online portals as Flipcart, Ebay, Yebhi, FashionandYou etc. are tremondously growing. There growth is only from India not from other countries, I next revolution will be E-Commerce and Online Trade where everyone likes to sit at their home and shop. Making the work easy in their finger tips.

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    i have been in retail industry from quite sometime and can confidently state that this is not going to happen. Analysts and consultants have been very bullish on india/ growth in india. But this growth is not going to translate to growth in ecommerce. Indians are not even ready to go and shop in modern retail stores forget about shopping online. this will take much more time. Indian shoppers are very choosy and stingy when it comes to spending and ecommerce would be the last place for them to shop.

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