Study on E-Commerce in India & Madhya Pradesh as a state

India has recorded total $1124B national sales (+Export) in FY 2020 with 12.5% of CAGR. Out of which E-
commerce sales figure stood at 5% of total sales which is $64B with 25% of CAGR in same FY.
India has reached to 5% of penetration ($64B market) in E-commerce space and expected to reach 11%
($120B) by 2024. As compare to $20B E-Commerce market in 2016, which tripled by $64B market in 2020.
Despite of lockdown out of few categories which gives growth, E-Commerce was one of them who post 8% of
growth.

To evaluate E-Commerce, Internet penetration status is

backbone for the sector performance. As per TRAI 2020
figures, India has successfully managed 50% of internet
penetration in country (105% in Urban & 28% in Rural =
avg 55%) which is 65 Cr of Population and projecting to
reach by 90 Cr of population by 2024. Interestingly rural
India growing by 45% in 2021 as compared to 22% in
2020.

Immense E-Commerce potential mainly coming from

Startups, where out of 9, 4 are in business with
eCommerce. Also, in supply side, customer base has
reached to 150million shoppers in 2020 which is expected to reach 220million by 2024. Which means India will
add new 7 Cr shoppers in next 4 years.

From all category, Grocery market alone estimated to reach $20B in 2024 which is now at $1.9B with growth
rate of 57%

Demographically, to untapping the potentials in eCommerce which are mainly coming from tier 2 & 3 markets
who accounted 90% of share from new or fresh customers. Big giants like Flipkart/Amazon has reported 3 out
of every 5 orders are coming from tier 2 and 3 cities.

Madhya Pradesh still lagging the national average of 55% internet penetration in country. MP stands on 44% of
penetration which is just ahead of UP, Bihar & Assam stating lot of ground yet to cover.

Karnataka, Maharashtra, AP, Tamilnadu and Delhi are top

5 states in terms of eCommerce penetration which
accounts 60% of total national pie. And 15 top cities
alone cater 65% of total order books in ecommerce
space. Whereas MP contributes less than 1% of total
eCommerce contribution in overall India.

Bhopal and Gwalior ranked 16th and 18th recently in key

eCommerce hub of nation. Where as Indore, Ujjain &
Hoshangabad along with Katni and Maow are in potential
players list in state contribution.

As government intervention in promoting eCommerce in

last month union cabinet has approved 16 states for their
Bharat net project under PPP model and MP is one of
them which will benefit to end mile reach for potential
entrepreneurs. Also, The Confederation of Indian Traders
(CIAT) also in pilot study in MP state to launch eStores to
all MSMEs at national level to compete with big fish like
Amazon or Flipkart. Also various national yojnas like Digital India, Make in India, Start-up India, Skill India &
schemes like Mudra, SFURTI, PPP model are all focussed in single direction to untapped eCommerce potential
and mainly to empower MSMEs of the nation. Also, various policy supports like 100% FDI, 61000Cr Bharat Net
investment for broadband are all align to promote eCommerce and MSME space.

Major Hub in MP Districtwise are Mandideep in Bhopal,

Pithampur & Dewas in Indore, Maneri & Katni in Jabalpur,
Malanpur & Banmore in Gwalior.

MP has a made a significant progress in the last couple of

years and is further paving way to be at the forefront of the
eCommerce revolution. The State has set up over 24,000
kms of optical fibre backbone to cover all its 313
developmental blocks across 45 districts (One of the highest
optical fibre coverage in the Country). Four software
technology parks (STP units) are in the pipeline to be setup
in Bhopal, Indore and Gwalior including high-speed data
connectivity. The State boasts of 38 IT engineering colleges
and provides a learning ground for the future IT
professionals by establishing the countries first Indian
Institute of Information Technology and Management (IIITM)
at Gwalior. This is an added advantage to the investors
looking to invest in the MSME space in the State as there
would be a wide availability of qualified and skilled
professionals at a relative low manpower cost.

Governments, whether of any state or at the Centre, have on various platforms accepted the potential of
micro, small, and medium enterprises (MSME) and the pivotal role they play in the Indian economy. No matter
what the industry or domain, MSMEs contribute a major role in its growth. But with deeper internet
penetration, MSMEs have gained muscle like never by catering to an online base. The internet was once the
weakness of MSMEs, but with the passage of time this has turned into their strength and eventually
ecommerce has become a game changer for them. By embracing ecommerce platforms, MSMEs are
surpassing past revenues and business margins due to increased market reach and by establishing online
connections with new and unexplored markets.

Source:

https://www.ibef.org/industry/ecommerce.aspx

https://www.freepressjournal.in/bhopal/bharatnet-in-madhya-pradesh-villages-implementation-through-ppp-
model-in-16-states

https://trai.gov.in/sites/default/files/Report_09112020_0.pdf

https://in.fashionnetwork.com/news/Cait-carries-out-pilot-in-madhya-pradesh-to-create-e-commerce-stores-
for-traders,1176604.html

https://economictimes.indiatimes.com/tech/technology/indias-e-commerce-sector-sees-big-growth-in-
2021/articleshow/80055318.cms?from=mdr

https://browntape.com/which-part-of-india-is-contributing-the-most-to-e-commerce-growth/

https://www.statista.com/statistics/759376/india-number-of-online-consumers/