Digital economy | The e-com revolution

India’s digital revolution did not arrive with a bang; it seeped in, quietly rewiring the habits of a billion-plus people. What began as a state-led push—digital connectivity and near-frictionless payments—ended up reshaping the everyday: how Indians shop and save, hail rides and order dinner, work and invest.

Connectivity was the first hinge. Fourth-generation networks existed since the early 2010s, but high prices and patchy coverage kept usage limited. That changed decisively in September 2016, when Reliance Jio entered the market and drove data prices sharply lower. This commercial disruption coincided with the Modi government’s Digital India programme, launched a year earlier, which treated broadband access and digital literacy not as market outcomes but as public goods. Together, cheap data and state-backed digital rails collapsed the distance between metros and mofussil.

The second hinge was payments. Launched in April 2016, the Unified Payments Interface (UPI) found its moment later that year, when demonetisation jolted cash out of daily circulation. QR codes migrated from air-conditioned malls to kirana counters and auto dashboards. By 2025, UPI was processing around 20 billion transactions a month, less a fintech novelty than the country’s default payment language.

E-commerce ran hard on these rails. Amazon and Flipkart scaled quickly, but it was smaller startups that learnt to work India’s frictions—hyperlocal logistics, splintered supply chains. Zomato and Swiggy turned online food ordering into habit; quick-commerce firms like Blinkit and Zepto compressed grocery runs into minutes. A wave of niche direct-to-consumer brands bypassed traditional retail altogether, using digital discovery, payments and logistics to build national footprints.

This proliferation was not accidental. The Startup India programme, unveiled in 2016, signalled a decisive shift in state attitude—easier incorporation, tax incentives and a narrative that legitimised entrepreneurial risk after decades of regulatory suspicion. In hindsight, the 2021 startup IPO rush—led by Zomato and Paytm—and the correction that followed look less like a bubble bursting than an ecosystem testing its limits. By end-2025, it was back in the market, carrying a new cohort of listings—Urban Company, Lenskart, Groww, Physics Wallah—with even deeper digital roots.