Travel industry to lead e-commerce trade in India

13 Oct,2011

By A Correspondent

With a booming retail market and over 100 million internet users in the country, e-commerce is likely to enter a high growth phase in coming years, economic advisor at the Department of Information Technology Mr BN Satpathy has said.

Travel will continue lead the online trade of goods and services in India and globally as new business models emerge in e-commerce space, he said while addressing delegates at a conference organised by The Associated Chambers of Commerce and Industry of India (Assocham).

Mr Satpathy said the government is working on a new Information Technology Policy which will propel the growth of low-cost, internet-enabled and hand-held devices. He asked business chambers like Assocham to be an interface so that industry data gathering and dissemination can be made online.

Chamber secretary general Mr DS Rawat said the market size of e-commerce industry is expected to be Rs 46,520 crore by December 2011 with 81 per cent travel transactions and 6 per cent product purchases.

“India is poised to be one of the top e-commerce hubs in the near future as number of internet users boom. This will bring in a new revolution in retail industry,” he said, adding that the size of e-commerce globally is about 700 billion dollars.

Accelerated innovations have expanded the online retail market to $241 billion in Europe, $176 billion in the United States, $76.4 billion in China and $10.3 billion in India.

The Indian retail industry is currently estimated at $520 billion and e-commerce is a sub-set of it. With high GDP growth rate figures, young population with a median age of 25 years, large and relatively insulated rural tracts coupled with people’s hunger for achievement, the country is projected to witness maximum growth coming from tier II and tier III cities.

At present, small towns contribute 40 percent of all e-commerce transactions due to increasing broadband penetration. Industry experts say the numbers of people who have ever used internet and personal computer literates have increased to 88 million and 119 million respectively.

India has the second fastest growing travel market globally which is estimated at $42 billion. Of this, the online travel market is expected to grow from $2.9 billion in 2008 to $7 billion by next year.

Others who spoke during the conference were Mr Balendu Srivastava, group business director of e-Tech Group at IMRB International, Mr Kashyap Vadapalli, director of Category Management at eBay India, Mr Dhruv Shringi, co-founder and CEO of, Mr Harish Bijoor, CEO of Harish Bijoor Consults Inc and Mr Bikky Khosla, CEO of

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