Topics: Internet, Gross domestic product, Developing country Pages: 35 (5050 words) Published: October 20, 2014
Technology, Media, and Telecom Practice

December 2012

Online and upcoming:
The Internet’s impact
on India
Chandra Gnanasambandam
Anu Madgavkar
Noshir Kaka
James Manyika
Michael Chui
Jacques Bughin
Malcolm Gomes

This report is furnished to the recipient for information purposes only. Each recipient should conduct their own investigation and analysis of any such information contained in this report. No recipient is entitled to rely on the work of McKinsey & Company, Inc. contained in this report for any purpose. McKinsey & Company, Inc. makes no representations or warranties regarding the accuracy or completeness of such information and expressly disclaims any and all liabilities based on such information or on omissions therefrom. The recipient must not reproduce, disclose or distribute the information contained herein without the express prior written consent of McKinsey & Company, Inc.

Online and upcoming: The Internet’s impact on India


In the four decades since its inception, the Internet has driven dramatic change. It has enabled flows of information, including entertainment, news, and financial and academic material. It has brought people closer together by enabling various forms of interpersonal communication, notably e‑mail, instant messaging, video conferencing, and social networking. And it has allowed consumers to purchase virtually anything at any time, while providing producers with direct access to a wide range of markets. Furthermore, the Internet is a bustling industry, spurred by entrepreneurship and supported by a variety of industries and large enterprises. Online productivity tools and communications advancements provide benefits to almost all enterprises and governments. The Internet has helped governments to broaden their services to citizens and improve their delivery. In a very short period, it has become difficult for most of us to imagine a world without instant and continuous access to the Internet.

This report examines the impact of the Internet on India. It complements an earlier series in which we examined the Internet’s impact on a group of developing countries that have both the scale and the dynamism to become significant players on the global stage in the near future (see Online and upcoming: The Internet’s impact on aspiring countries, McKinsey & Company, January 2012). It also builds on our earlier assessment of the impact of the Internet on the advanced economies and several large developing economies, such as China, Brazil, Russia and India (see McKinsey Global Institute, Internet matters: The Net’s sweeping impact on growth, jobs, and prosperity, May 2011). As an ongoing body of work, our view of the Internet’s impact on India is evolving. The insights and conclusions presented in this report are refinements of our earlier multi-country work, based on an in-depth assessment of India-specific data and multiple expert interviews in India. As data sources improve and the body of knowledge relating to the Internet expands in India, we look forward to continue to evolve our perspectives.

Our research focuses on the way the Internet affects India’s economy currently, and its potential to do so in future. In our attempt to understand the impact of the Internet, we focus on how economic growth and prosperity have been affected; we also seek to discover how individuals, entrepreneurs, enterprises, and public sector entities have been transformed. In addition to assessing the Internet landscape and its impact on the various groups of participants, we examine the potential for India to utilize the particular strengths of its economy to enable businesses and individuals to derive greater benefits from the Internet. We do not offer prescriptive policies, but focus on opportunities and possibilities for India to accelerate its efforts to capture the Internet’s benefits. This is an independent McKinsey & Company report that draws on various sources: research from...
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