It is a millennial world – and with that comes the ability to do almost anything online. This is not a surprise to most Americans, as many well-known American clothing retailers have fallen prey to the rise of e-commerce. However, what may come as a surprise is that this is becoming a global phenomenon.
In a recent study, India was recognized as having the fastest growing e-commerce business in the world, where the market is expected to reach $64 billion by 2021. Below are three reasons why India has become the perfect platform to capitalize on e-commerce:
-
Social Factors: More than 50% of India’s population is below the age of 25, and more than 65% of its population is below the age of 35. Last year, India hit one billion mobile phone users, which includes over 125 million smartphone users, a number that is rapidly growing. The youth of the Indian population compounded with the expansion of data usage creates a social atmosphere for e-commerce to thrive.
-
Economic Factors: After Prime Minister Modi’s legislation to demonetize the 500 and 1,000 rupee notes, India will move towards a cashless society by default. Currently, most items in India are paid for with cash, but the lack of cash notes should incentivize Indians to spend their money electronically, facilitating a platform for e-commerce.
-
Political Factors: Recently, the Indian government has pushed legislation to make it easier for e-commerce companies to conduct business in India. Specifically, companies with 100 percent foreign direct investment do not need government approval to operate a retail e-commerce business in India. The legislation has made the process less bureaucratic and many Indian companies are already being flooded with foreign investments.