India’s digital economy to account for 20% of GDP by 2026: Rajeev Chandrasekhar

India’s digital economy will account for 20% of the country’s gross domestic product (GDP) by 2026, said Rajeev Chandrasekhar, the Union Minister of State for Information Technology. He added that India’s digital economy contribution to GDP has grown from 4.5% in 2014 to 11% in the current time.

The minister was speaking at the G20 Digital Innovation Alliance Summit on Thursday where he said that the center of gravity for tech used to be a few countries and corporations is now disrupted by open source systems and younger startups.

In June, a report by Google, Temasek, and Bain & Company found that India’s internet economy may grow to $1 trillion by 2030 from $175 billion in 2022. This growth is likely to be driven by key internet economy sectors like e-commerce, online travel, ride-hailing and food delivery apps. Notably, the rising digital demand in tier-2 cities has contributed majorly to the surge, along with digitalisation of traditional business and India Stack. The report also stated that internet economy’s contribution to India’s technology sector will grow from 48% in 2022 to 62% in 2030.

Earlier this week, the Union Cabinet approved the expansion of the Digital India program with an outlay of ₹ 14,903 crore for five years, from 2021-22 and 2025-26. Ashwini Vaishnaw, the minister for electronics and information technology said that a lot of work has already happened on this front and that the government is looking at modifying the existing schemes to make them more relevant to current requirements.

The Digital India Scheme was launched in 2015 and acts as an umbrella program, covering schemes like Aadhaar, MyGov, Bharat Interface for Money (BHIM), and country-wide broadband connectivity.