Startups Can Contribute 4-5% Of India’s GDP: StrideOne Report


According to a StrideOne report, India’s startup ecosystem has the potential to contribute about 4-5 per cent of the country’s GDP (Gross Domestic Product) in the next 3-5 years, with over 60,000 registered startups.

According to the Economic Survey 2021-2022, India has approximately 61,400 registered startups, making it the world’s third-largest startup ecosystem after the United States and China.

According to the report, over 24,500 platforms will be registered in 2022, up from around 20,000 in 2021. It notes that registration of new startups is projected to grow at an annualised rate of 25 per cent from 2022-2027.

According to the report, job creation by startups will grow at a 24 per cent annual rate between 2022 and 2027. While startups created approximately 1,92,000 jobs in the previous year, the report predicts approximately 2,30,000 new jobs in 2022.

It also stated that startup funding has been rapidly increasing, with total funding raised increasing 42 per cent annually from 2016 to 2021, while deal count increased 23 per cent during the same period. Among the funds raised, SaaS, fintech, and logistics and autotech attracted the most investment.

The report examines how startups and players in industries such as textiles, the gig economy, and B2B logistics interact and contribute to overall growth.

Charting the country’s contribution to the gig economy, it notes that gig workers will account for more than 70 per cent of the employee base for fast commerce startups by 2022. While approximately 8 million gig workers made up 1.5 per cent of the workforce in India in 2020-21, their contribution to the overall workforce is expected to increase to 4 per cent by 2024.

The report added that startups are limiting the number of permanent employees they hire. These permanent employees are being replaced by gig workers. “Since October 2021, the total number of enterprises that have shifted to a semi-gig workforce model has increased by 15 per cent.

In terms of the B2B logistics market, which is expected to more than fivefold by 2025, the report notes that over 90 per cent of the country’s logistics startups, including Delhivery and Shadowfax, had small truck owners accounting for roughly half of their total fleet.

It also mentions that with startups enabling digitisation and platformisation, fleet owners can increase utilisation with tech optimization, reducing 40-50 per cent of their fleet’s idle time.

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