India's e-commerce market to touch $550 billion by 2035: Report

E-commerce has brought a massive revolution in India's retail industry with growth projected to touch $550 billion by 2035, according to a report by Ananrock-ET Retail. It is likely to touch $345 billion by 2030-end, it added. The Indian e-commerce market is growing at a CAGR of 15 percent, and in 2024, the value of this disruptive segment was estimated at $125 billion.

According to Anuj Kejriwal, CEO & MD – ANAROCK Retail, the penetration of e-commerce in tier-2 and 3 cities has fueled the growth of the entire retail industry.

"The share of online shoppers from Tier 2 and 3 cities has increased to 56 percent in FY2024 from 46 percent in FY 2020, and is expected to reach 64 percent by FY2030," Kejriwal said.

Meanwhile, the overall Indian retail industry's market size is expected to touch $2,500 billion by 2035, witnessing a three-fold increase compared to 2019, the report added.

In contrast, new mall supply across the top 7 cities stood at 1 million sq ft in 2024 while the absorption stood at 6 million sq ft in 2024.

"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 percent 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," Kejriwal said.