India's digital economy drives economic growth

India’s digital economy has expanded rapidly over the past decade, playing a key role in economic growth, employment, and sustainable development. According to the State of India’s Digital Economy Report 2024, India ranks as the third-largest digitalized economy globally and 12th among G20 countries in individual user adoption.
 
By 2029-30, India’s digital economy is expected to contribute 20% of national income, surpassing agriculture and manufacturing. In the short term, growth will be driven by digital platforms, intermediaries, and deeper industry adoption, gradually balancing the share of ICT industries in the digital economy.

In 2022-23, the digital economy accounted for 11.74% of GDP ($402 billion) and employed 14.67 million workers. ICT services and electronics manufacturing contributed 7.83% of Gross Value Added (GVA), while digital platforms and digitalization in BFSI, retail, and education added another 4%. India also hosts 55% of the world’s Global Capability Centers (GCCs), driving AI, cloud services, and business outsourcing.

Digital adoption varies by sector. Retail is shifting to omni-channel models, while BFSI has 95% digital transactions, though lending remains offline. Education favours hybrid learning, and hospitality and logistics integrate AI, though smaller firms lag behind.

By 2030, the digital economy will make up one-fifth of India’s GDP, with digital industries growing at 17.3%, far outpacing overall economic growth of 11.8%. Digital platforms, in particular, are set to expand by 30%.

Currently, 2.55% of India’s workforce is employed in digital sectors, with women benefiting from increased job opportunities in industries where mobility was a barrier.
India’s digital expansion is reshaping the economy, driving innovation, job creation, and economic inclusion across various sectors.

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