A recent study by the World Bank indicates online sales account for only 1.6% of the total retail sales. This compares very poorly with countries like China which has 15% of retail sales happening online. Surprisingly, even the global average is as high as 14%, showing that India has a long way to go and a massive scope in the online retail space.
In its report titled, â€˜Unleashing Ecommerce for South Asian Integrationâ€™ the World Bank says that though the country has already achieved a high degree of digitization, there are still issues relating to taxation and data privacy which pose challenges to the growth of e-commerce in a big way.
The report also refers to e-commerce trade between different countries and says there is very little of intra-regional e-commerce happening. If at all, the transactions involve countries in other regions like the US and the UK. China is included in the online trade happening from India. This has been revealed after a poll was conducted involving 2,200 firms spread over South Asia. Possibly the researchers expected more trade involving countries in the neighbourhood like Sri Lanka, Bangladesh, Singapore etc.
Not surprisingly, the report also found that mobile phones were one of the top categories of products sold online. Some of the other categories figuring among the most traded products on e-commerce platforms included electronics, clothing, footwear, and consumer durables. This too does not come as a big surprise. The only positive takeaway for the Indian e-commerce firms would be that the scope to grow is endless from this low figure of 1.6%.