E-commerce Firms to Invest $8 billion in Infrastructure, Logistics in India: Assocham-PwC Study

With the growing popularity of online shopping in India, the e-commerce companies are expected to invest close to $6-8 billion in logistics, infrastructure and warehousing in the next few years, an Assocham-PwC study said.

The e-commerce market in India is expected to touch $80 billion by 2020.

At present, there is a very low level of air cargo penetration and only a few airports are equipped to handle large volumes of express delivery parcels.

As e-commerce gathers momentum and moves to the tier-II and tier-III cities, there will be increasing demand of expanding air cargo connectivity to smaller towns. The industry would invest about $8 billion by 2025, the study noted.

"Innovations are very important in this sector, as the demand is always for more reach and faster shipping at lower costs. The companies will need to invest in automation, while utilizing existing resources well," said D.S. Rawat, Secretary General, Assocham.

The overall e-commerce industry, valued at $25 billion has been growing at a compounded annual growth rate of about 35-40 per cent each year, the study said, adding that it is expected to cross the $100 billion mark in five years.

"India is successful in becoming the largest e-commerce market in the world. The rapid transformation in logistics, innovation, consumerism and productivity prove to be an interesting case study for other emerging economies," Rawat added.