India’s digital economy is set to grow nearly twice as fast as the overall economy, potentially contributing close to one-fifth of the country’s national income by 2029-30, according to a report by the Ministry of Electronics and Information Technology.
Within six years, the digital economy’s share is projected to surpass that of agriculture or manufacturing. In the near term, the highest growth is expected from digital intermediaries and platforms, followed by increased digital diffusion and the digitalisation of other sectors, the report stated.
The domestic cloud services market and the global capability centre sector are identified as the fastest-growing segments in India. The report highlighted that the adoption of artificial intelligence (AI) for enhancing operations, improving customer experience, and launching innovative services could drive the cloud services market to grow at a compounded annual growth rate of 24% between 2024 and 2027, potentially reaching US$ 20.3 billion.
Among traditional sectors such as banking, financial services, retail, education, hospitality, and logistics, digital growth remains uneven. The report observed, “For example, retail sales are digitalising much more than wholesale sales. Firms are also investing in digital methods for customer acquisition and business development. Chatbots and AI applications are fairly commonplace.”
With the rapid digitalisation of industries and increased adoption of emerging technologies like AI, India’s digital economy is poised to play a pivotal role in the nation’s economic landscape, outpacing the growth of traditional sectors in the years to come.
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