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Indian E-commerce industry may touch 22 bn in 2015 PwC

In coming years, as internet presence increases in rural areas, rural India will yield more e-commerce business.
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The Indian e-commerce industry is expected to touch $22 billion mark in 2015, says PwC report. The sector in India has grown by 34 percent (CAGR) since 2009 to touch $16.4 billion in 2014.

Currently, eTravel comprises 70 percent of the total e-commerce market. eTailing, which comprises of online retail and online marketplaces, has become the fastest growing segment in the larger market having grown at a CAGR of around 56 percent over 2009-2014.

The size of the eTail market is pegged at $6 billion in 2015. Books, apparel and accessories and electronics are the largest selling products through eTailing, constituting around 80 percent of product distribution, the PwC report titled ''E-commerce in India: Accelerating Growth” said.

The increasing use of smartphones, tablets, internet broadband and 3G has led to developing a strong consumer base likely to increase further.

E-commerce will rise rapidly in India in coming years. Around 75 percent of Indian internet users are in the age group of 15 to 34 years. In coming years, as internet presence increases in rural areas, rural India will yield more e-commerce business.

By 2020, eTail in India is expected to account for 3 percent of total retail. Further, orders per million are expected to more than double from five million in 2013 to 12 million by 2016, which will mean more opportunities for both consumers and eTail companies. While the share of online shopping in total retail has increased at a fast pace in the last few years, it is still miniscule compared to the figure in China, where the share is 8-10 percent.

According to Forrester Research, an independent technology and market research firm, only 16 percent of India’s total population was online in 2013 and of the online users only 14 percent or 28 million were online buyers.

India, therefore, was still in a nascent or immature stage of evolution of online retail spending. China was in ascending stage at 50 percent, whereas Japan (69 percent), Australia (57 percent) and South Korea (70 percent) were in mature stage.

In absolute terms India’s internet users are short by only 36 million as compared with 279 million in the US and higher than that in Japan, Brazil and Russia, according to the report.

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