India’s e-commerce market is forecast to grow by 12.5% in 2025, reaching INR17.7 trillion ($211.6 billion). This rapid growth will be driven by strong consumer appetite for online shopping and growing trust in digital payments. The sector’s momentum reflects deeper digital integration, government-led policy support, and rising adoption of AI-driven payment innovations, reveals GlobalData, a leading data and analytics company.

GlobalData’s E-Commerce Analytics reveals that India’s e-commerce market is projected to grow at a compound annual growth rate (CAGR) of 11.5% between 2025 and 2029 reaching INR27.3 trillion ($326.7 billion) in 2029.

Poornima Chinta, Senior Banking and Payments Analyst at GlobalData, comments: “The e-commerce market in India has experienced rapid growth in recent years, driven by broader digital adoption, increasing internet and smartphone penetration, and the availability of secure online payment tools. The growing popularity of online shopping events such as Flipkart’s Big Billion Days, Myntra’s Big Fashion Festival, and Amazon’s Great Indian Festival has further supported the surge in India’s online shopping market.”

The Indian government’s Goods and Services Tax (GST) rate cuts, effective from 22 September 2025, on food and household essentials, electronics, and fashion and wellness products are also supporting discretionary spending and e-commerce sales. Leading e-commerce firms, including Reliance Retail, Amazon, and Flipkart, are participating in the government’s 100-day “GST Bachat Utsav” campaign, which requires retailers to display GST discounts on invoices and submit reports on benefits passed to consumers.

Government and private-sector initiatives are another key driver of e-commerce growth. In December 2024, Amazon partnered with the government’s Startup India initiative to help startups build and scale their e-commerce businesses through mentorship, training, and access to Amazon’s technology, tools, and marketplace.

The deployment of AI and other innovative technologies are further accelerating the rise of online retail in India. In October 2025, the National Payments Corporation of India, Razorpay, and OpenAI launched a pilot program to integrate UPI within ChatGPT, enabling users to shop online and complete payments directly within the chat interface. Online supermarket “bigbasket” is among the first e-commerce platforms participating in the pilot.

In terms of payment tools, alternative methods are the preferred options, driven by the convenience and security of digital wallets and the strong preference for Unified Payments Interface (UPI)–based mobile payments among consumers and merchants. International brands such as Google Pay and Amazon Pay remain among the most widely used.

Payment cards are the second most popular e-commerce payment method with credit cards more preferred than debit cards due to the value-added benefits they offer, including interest-free instalment payment options, reward programs, cashback, and discounts. Their usage is set to increase further with banks offering discounts in partnership with online retailers.

In August 2025, State Bank of India (SBI) partnered with Flipkart to launch the Flipkart SBI Co-Branded Credit Card offering cashback on purchases made at Flipkart, Cleartrip, and Myntra in addition to other rewards and discounts.

Chinta concludes: “India’s ecommerce market will continue its upward growth trajectory over the next few years with consumer appetite for online shopping showing no signs of waning. The country’s young, upwardly mobile demographic, growing popularity of alternative payment solutions, favorable regulatory initiatives, and technological advancements are converging to transform how Indians shop—creating new market opportunities, improving customer experiences, and attracting fresh investment.”