India will have to add around 80 million jobs by 2025 to ensure enough jobs for its growing population.
The government is trying to boost manufacturing in India, but it will still be 24 million jobs short as the large services sector do not generate enough employment, as estimated by HSBC Holdings PLC.
E-commerce could help in filling the gap, according to economists Pranjul Bhandari and Prithviraj Srinivas at HSBC.
Internet penetration and online purchases in India today is almost equal to where China’s were about seven years ago. That is when Chinese e-commerce had started booming.
India doesn’t have an organised network of brick-and-mortar retailers yet. India is still a cash-based economy, an attempt to give poor people access to banking has resulted in 220 million new accounts in past two years. Mobiles wallets and other payment methods are also on a rise among the youth.
Online sales is expected to jump from $21 billion now to $420 billion in 2025, depending on the success of government plans of modernising roads and expanding broad bank connectivity, training programs for workers, and incentives to create startup companies.
The boom could create about 20 million new jobs.
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