BackStartups may make 4-5% of GDP in five years: StrideOne
The report by StrideOne forecasts more than 24,500 platforms to be registered in 2022, up from about 20,000 last year.
PremiumBENGALURU : With more than 60,000 registered startups, India’s startup ecosystem has the potential to contribute 4-5% to the gross domestic product (GDP) in the next 3-5 years, said a report by StrideOne.
India has about 61,400 registered startups, making it the world’s third-largest startup ecosystem in the world after US and China, as per the Economic Survey 2021-2022.
“This rise of startups has made India the third largest startup ecosystem in the world and has significantly impacted the Indian economy showcasing the ability to contribute approximately 4-5% to the GDP of India," said Ishpreet Singh Gandhi, co-founder of StrideOne, a tech-enabled non-banking financial company.
The report forecast more than 24,500 platforms to be registered in 2022, up from about 20,000 last year. It projected registration of new startups to grow at an annualized rate of 25% in the five years through 2027.
It said that job creation by startups will grow at 24% annually during 2022-2027.
While 2021 saw about 1,92,000 jobs being created by startups, the report forecast about 2,30,000 new jobs to be created this year. It also noted that startup funding has been growing rapidly, with total fundraising increasing 42% annually, during 2016-2021, while deal count climbed 23% in the period.
Software-as-a-Service (SaaS), fintech, and logistics and autotech sectors attracted the most investment.
However, a report by market intelligence platform Tracxn said funding in Indian startups fell by 35% till 5 December to $24.7 billion, from the same period last year, hit by a drop in late-stage funding.
According to StrideOne, more than 28% of micro, small and medium enterprises (MSMEs) in the textile industry in India rely on startup platforms to source business opportunities, registering a 29% uptick in their revenues after joining such platforms in 2022. Charting the gig economy’s contribution, it noted that gig workers already comprise more than 70% of the employee base for fast commerce startups in 2022.
While about 8 million gig workers comprised 1.5% of the workforce in India in 2020-21, their contribution to the overall workforce is expected to grow to 4% by 2024.
“Startups are limiting their hiring of permanent employees. Gig workers have begun to replace these permanent employees. The total number of enterprises who have shifted to a semi-gig workforce model has increased by 15% since Oct 2021," it noted.
On the B2B logistics market, which is projected to grow over fivefold by 2025, the report said that over 90% logistics startups such as Delhivery and Shadowfax had small truck owners make up about half of their total fleet.It also noted that with digitization and platformization enabled by startups, fleet owners can increase utilization with tech optimization, thus reducing 40-50% of their fleet’s idle time.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
