2017 Dot-com Shining: India’s Rising Ecommerce Industry

ecommerce india

According to the Central Statistics Organisation (CSO) and International Monetary Fund (IMF), with various positive factions thriving, including that of E-Retail,India has emerged as the fastest growing economy in the world. As recent as few years, India has noted a constructive rise in people venturing out for online retail. The past year’s ecommerce sales were approximately $16 billion with chances of market expanding up to seven times higher, according to Morgan Stanley. Channelized by this robust investment in the sector and swift increase in the number of netizens, various agencies predict that Indian e-commerce sales are expected to reach US$ 120 billion by 2020. Three of the main driving factors to supplement this rise would be the inculcation of niche players, role of FDI and GST and how e-retail is changing the face of food and grocery for good.

Niche players: a key part of e-growth

The recent rise in digital literacy has led to an influx of investment in e-commerce firms, levelling the market for new players to set up their base, while churn out innovative patterns to disrupt old functioning. Online retailing has had a heady impact on the sales turnover of brick and mortar stores, urging market pundits to rethink business on the terms of product innovation. Consumers have opened up to personalization and unique product offerings, making the adage “one size fits all” redundant in the marketplace. Also, the marketplace is changing rapidly to accommodate a new culture of diversity, with taste being as varied as Chicken Tadka in Sushi. These have allowed niche players catering on specific categories to take the podium. Businesses have realized the shift away from offering everything for a large demography to focusing on just a singular idea executed exceptionally well, is an effective path to success.

The niche business model is flawlessly suited to today’s dynamic personalized economy, where consumers are harking for the kind of expertise that can be facilitated through laser-focused models. The new economy is being driven not only by the consumers who are procuring products and services according to their requirements , but also by entrepreneurs who are gearing to strike the apt balance between fulfilment of passions and  progressive financial success.

The government, from their part, has come up with beneficial reforms to promote this rise of niche players.

Roles of FDI and GST in this e-rise

The government has been promoting the cause towards a prolific digital environment, for a while now. Their most significant and often conversed regulation which impacts e-commerce is that of FDI. As per prior law, FDI in ecommerce was not allowed for single brand/multi-brand retail companies, although 100 per cent FDI is allowed under the automatic route in wholesale/B2B e-commerce/ for companies providing “technology platform” services for retail transactions. The burgeoning expansion of Indian ecommerce market has ensured in cementing its value amongst conglomerate retail/ecommerce players from European and American markets while the FDI regulations acted as a check in not letting foreign players set up a majority base at the behest of our economy. Hence, the FDI has single-handedly uplifted the structure and revenue scale for the benefit of all e-commerce players in the country.

The recent announcement of GST roll out, another significant reform would help e-retail competitors streamline their supply chain and simplify their tax structure, while rationalizing seamless integration of goods and services across the country. Moreover it will eliminate the dual taxes being imposed on the current ecommerce eco system. The incorporation of GST ensures absolute clarity in regards to application of direct taxes on transactions undertaken by online businesses. It is the first step taken by the Government in clearing laws for e-commerce, in-turn providing a stable environment to harness growth and development.

Apart from GST/FDI and rise of personalized offerings, e-retail is getting an additional boost through nurturing Food and Grocery, under their expansive wings.

Food and Grocery getting an e-lift by venturing online

Earlier, Food and Grocery section taking the online route, would be an improbable dream for many. Fortunately, with more consumers opting for convenience and the adaptation of a digitally charged ecosystem, big and small players are slowly infiltrating the market with their food and grocery-based offerings.

The eventual shift from neighbourhood kiranas to snap online purchases is brought about by birth of competitive pricing and the convenience of shopping from the comfort of one’s own home. Also, the availability of goods from any end of the world, acts as an icing to the already nuanced cakes. Indian consumers have overcome unfounded biases towards purchasing items online and preaching the safety of automated and online transactions. The accessibility of multiple payment methodologies have added to ease online shopping while saving both time and money. Yet, the need to overcome delivery challenges seems to be one of the major issues, that is being worked upon on a steady manner. In short, it is beneficial for Food and grocery to eschew the cause of digital liberation for a guaranteed chance at critical prosperity.


The stabilisation of e-retailing is in position to play a fundamental role in garnering sustainability and economic viability to various sectors of the economy. With such key factors in mind, e-retailers should progressively move forward to usher this revolution, in the upcoming years.


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