India’s Internet economy to double to $250 billion

India's Internet economy is expected to double to $250 billion, according to a report by BCG-TiE released on Friday.

E-commerce and financial services are expected to drive this growth, accounting for about $40-$50 billion of the Internet economy, followed by e-commerce products ($45-$50 billion), private and government infrastructure spending ($50-$60 billion), connectivity ($45-$55 billion), devices ($30-$40 billion) and digital media and advertising ($5-$8 billion), according to the report.

“India's Internet economy is expected to double from $125 billion to $250 billion, growing from the current 5% to 7.5% of the country's GDP,” according to the report titled ‘The $250 Billion Digital Volcano: Dormant No More.’

Mobile Internet users in India are expected to double from 391 million to 650 million by 2020, the report said, adding that 85% of these will be high speed internet users against 56% currently. It added that the data consumption by 2020 could potentially increase 10-14 times. The average data consumption is projected to reach 7-10 GB per user per month by 2020.

“It is essential to understand the three forces that are now synergising to unlock internet consumption in India - 4G enabled devices, reliable high speed data and proliferation of digital content,” Nimisha Jain, a BCG partner and the report’s co-author said.