Published on: April 9, 2026
India’s online retail market concluded 2025 on a strong note, with e-retail gross merchandise value (GMV) reaching approximately $65–66 billion, growing 19–21% year-on-year, according to the How India Shops Online 2026 report by Bain & Company in collaboration with Flipkart.
Growth accelerated through the year, supported by improving macroeconomic conditions and consumer sentiment. Private consumption growth rose to 10.5% in 2025, up from 8% during 2022–24, driven by GST cuts, income tax relief, easing inflation, and lower lending rates.
Despite strong e-retail growth, the broader retail sector is expected to reach $1.6 trillion by 2030, highlighting the continued importance of offline infrastructure.
India’s online shopping market has more than doubled over the past five years, with the shopper base reaching 290–300 million in 2025.
Gen Z shoppers are driving trends through influencer-led discovery, immersive content formats, and instant credit usage, particularly in lifestyle, beauty, and electronics categories.
India’s e-retail penetration remains low at ~1.6% of GDP compared to:
The market is projected to reach $170–180 billion by 2030, sustaining 20%+ annual growth.
As India’s GDP per capita approaches $4,000 by 2030, discretionary spending is expected to rise significantly. Metro consumers already spend ~65% higher than the national average.
Shyam Unnikrishnan, Managing Partner at Bain & Company said,
“Five years ago, India’s e-retail story was about potential; today, it is a reality. GMV has more than doubled, the annual active shopper base has reached nearly 300 million, and the seller ecosystem has tripled, with growth increasingly led by Tier 2+ towns and Gen Z. This expansion is driven by real improvements in what e-retail offers customers; better value, wider assortment, deeper and faster access, and smarter discovery. The runway ahead is equally compelling, with two in three social and chat users yet to shop online. As India’s GDP per capita approaches the $4,000 inflection point, where discretionary spending has historically accelerated in other emerging markets, this will provide further tailwinds for e-retail. The next five years will certainly unlock the next wave of growth in India’s e-retail market.”
Manan Bhasin, Partner at Bain & Company, said,
“Quick commerce plays a dual role—as a convenience channel for household essentials and a fulfillment channel for discretionary categories. Shopping behavior in quick commerce is distinct; high-intent shopping missions drive a higher incidence of search, faster checkout velocity, and conversions. Sessions last less than five minutes, half the duration of traditional e-commerce journeys. Brands have a short window to win and must strategically invest to own the front screen through targeted marketing. Winning brands also understand micro-markets to inform assortment and pricing decisions.”
Balaji Thiagarajan, Chief Product and Technology Officer (CPTO), Flipkart added,
“Scaling digital commerce across India’s unique demographics is a precision game, not just a volume game. This is why Flipkart’s conversational engine is built specifically for the Indian context by Indians, for Indians. By layering GenAI, we are ensuring a vernacular conversation for a customer in Muzaffarpur feels as effortless as a customer conversant in English purchasing a product in a metro. This creates a truly personal, assisted journey for the next hundred million Indians.
The shift from ‘search and browse’ to ‘describe and get’ is the most significant change in how Indians will shop over the next five years. India is already the world’s second-largest ChatGPT market. That is not a coincidence; Indian consumers are highly receptive to conversational interfaces that work in their language and understand their context.”
Q-commerce has doubled annually over the past two years, driven by:
Q-commerce contributes significantly to online grocery growth, with e-grocery penetration increasing ~5x since launch and now accounting for nearly 1.5% of the total grocery market.
Growth is powered by continuous innovation in:
High-frequency categories such as grocery, beauty, and general merchandise contributed over 75% of incremental GMV growth between 2020 and 2025.
Festive commerce remains a major demand driver, with daily active users reaching ~120 million during peak sale periods.
Generative AI is rapidly reshaping online shopping experiences:
Conversational commerce is shifting behavior from “search and browse” to “describe and get,” enabling more intuitive and personalized shopping journeys.
While still in early stages, use cases are emerging in product research and comparison. E-retail platforms remain strong due to:
India’s e-retail sector is entering a high-growth phase driven by digital adoption, Gen Z influence, and innovation in commerce technologies. With strong fundamentals and massive untapped potential, the next five years are set to redefine the country’s retail landscape.
Read more: Flipkart Appoints Priyanka Roy As Associate Director – Communications
