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India | Category Summaries: Ecommerce

India’s booming ecommerce sector has a lot of growing room. Although India ranks third in number of Internet users, after the US and China, Internet penetration remains relatively low.

The number of Internet users totals around 213 million, according to the Internet and Mobile Association of India (IAMAI). That means only about 15 percent of Indians are online, compared with half the population in China, according to the World Bank.

The ecommerce category reached around $13 billion in revenue in 2013, and is expected to grow rapidly as more Indians shop online and more retailers compete for their spending, according to IAMAI. Leading those retailers are Indian brands such as the online mall Flipkart, started by former Amazon employees, and Snapdeal, with about 20 million users, which hopes to replicate the success of China’s Alibaba.

Amazon entered India in 2012. Two years later, just days after Flipkart raised $1 billion in funding.  Amazon announced plans to invest $2 billion in Inida.

Walmart plans to open an ecommerce site in India during 2014. About one-third of ecommerce sales in India happen over mobile phones and that proportion is expected to increase.

The ecommerce category is growing rapidly, but no brands appear yet in the BrandZ India Top 50 because none are publicly traded, an eligibility criterion.