India’s food delivery sector emerges as key growth driver, gross output at `1.2 lakh crore in FY24: Report

New Delhi: India’s food delivery platform sector generated Rs 1.2 lakh crore in gross output in 2023-24 and has been expanding faster than the overall economy, emerging as a key economic driver, according to an NCAER-Prosus report.

Direct employment in the sector rose to 1.37 million in FY24 from 1.08 million in FY22, accounting for 0.2 per cent of India’s total workforce in both years.

Employment grew at a compound annual growth rate (CAGR) of 12.3 per cent during the period, significantly higher than the all-India CAGR of 7.9 per cent, the report titled Impact of Food Delivery Platform on the Indian Economy: GDP, Employment and Taxes said.

The study highlighted strong multiplier effects. For every Rs 10 lakh of production in the sector, economic output worth Rs 25 lakh was generated across the economy in 2021-22. Similarly, every Rs 10 lakh of income created in the sector led to Rs 24.8 lakh of income economy-wide in 2023-24.

In terms of taxation, Rs 10 lakh of production generated about Rs 40,000 in taxes, while supporting three jobs across the economy. Consumption linkages added another Rs 7 lakh to overall economic activity.

NCAER Professor Bornali Bhandari said the sector’s contribution to output, jobs and indirect taxes is growing much faster than the broader economy, signalling a structural shift in food services.

A separate report found benefits for restaurants, with 59 per cent reporting wider customer reach and platform-led revenue share rising from 22 per cent to 29 per cent between 2019 & 2023.