India’s Food Delivery Sector Nearly Doubles in Two Years, Emerging as a Powerful Economic Engine – NCAER-Prosus studies

• Food Delivery Platforms support 1.37 million jobs, and are growing faster than the national economy
• Food Delivery Sector Powers Restaurants, Agriculture, Logistics and Tech, Generating 2× Wider Economic Value
• Each platform job supports more than 2.7 additional jobs across the wider economy, revealing one of India’s highest service-sector multipliers

The National Council of Applied Economic Research (NCAER), India’s leading economic policy think tank, today released two landmark studies with Prosus, a global technology player and the power behind the world's leading lifestyle e-commerce brands. Titled 'Impact of Food Delivery Platform on the Indian Economy: GDP, Employment and Taxes’ and ‘Impact of Food Delivery Platforms on Restaurants’, the studies offer clear evidence on how food delivery platforms are reshaping the country’s restaurant ecosystem, labour markets and economic structure. They assess both the micro-level impact and economy-wide contribution of the platform sector through rigorous input–output analysis of 640 participating restaurants across 28 Tier 1, 2 and 3 cities. Alongside NCAER’s previous platform survey published in 2023, these findings complete a three-year research programme on India’s food delivery platform economy.

Reflecting on the findings, Dr Bornali Bhandari, Professor, NCAER, shared: “These studies offer a comprehensive empirical picture of how digital food delivery platforms are intersecting with India’s economy. The sector’s contribution to output, employment and indirect taxes is not only measurable but growing at a pace far exceeding that of the broader economy. At the restaurant level, the evidence of expanded market access, higher compliance and improved operational capabilities points to a structural shift in how food services businesses participate in the economy. This research aims to equip policymakers with credible data on a sector that has scaled rapidly and is now deeply woven into India’s digital and economic fabric.”

Adding industry perspective, Sehraj Singh, Managing Director, India & VP – Group Public Policy and Corporate Affairs, Prosus, noted, “The findings of these studies reflect what millions of small restaurants and platform workers experience every day. Platforms have become an essential bridge to demand, enabling restaurants to reach customers far beyond their immediate surroundings and giving many of them their first exposure to digital visibility, regulatory compliance and data-driven decision-making. The sector’s million-plus workers, supported by India’s growing digital infrastructure, represent one of the most dynamic labour segments in the country. At Prosus, we are proud to invest in platforms that don’t just grow fast - but grow responsibly, strengthen the economy, and align with India’s long-term development goals.”

Key findings from the Economic Impact study demonstrate:

• The food delivery platform sector generated ₹1.2 trillion in gross output in 2023–24 and has been expanding at a rate faster that of the overall economy
• The sector directly employed 1.37 million workers in 2023–24, up from 1.08 million in 2021–22
• Each platform-linked job supports 2.7 additional jobs across the wider economy, making it one of the highest employment multipliers in India’s services sector.

Showcasing meaningful gains for restaurants on platforms, the Restaurant Impact study indicates:

• 59 percent restaurant owners reported expanded reach to new customers
• 52.7 percent added new menu items
• 50.4 percent witnessed an increase in customers
• Restaurants’ revenue share from platforms increased from 22% to 29% (from 2019-2023)

Platforms also provided operational tools - onboarding, training, menu guidance, advertising support and accounting features - that many small and home-based kitchens did not possess prior to joining the ecosystem.

In addition to the empirical findings, the studies highlight several policy considerations for India’s evolving platform economy. The strong link between platform participation and MSME formalisation suggests an opportunity for targeted incentives that encourage small restaurants to adopt digital tools and expand market reach, especially in Tier 2 and Tier 3 cities. Given the sector’s high employment multiplier and growing fiscal footprint, integrating platform-sector metrics into national statistical and labour monitoring systems would enable more accurate tracking of a rapidly expanding services segment.

The research also points to the need for balanced regulatory approaches that support predictable operations for small businesses while preserving innovation, ease of entry and consumer benefits. Finally, as the sector employs more than a million workers, enhancing the portability of social protections could strengthen economic security without compromising flexibility for platform-linked labour.

Together, the studies provide a robust foundation for policy discussions related to digital platform regulation, MSME development, labour markets and urban economic planning. By quantifying the sector’s economic footprint and presenting detailed evidence on restaurant behaviour, formalisation and business outcomes, the research advances understanding of a segment that is increasingly central to India’s service economy.

Impact Assessment of Food Delivery Platforms on Restaurants report.

Impact of Food Delivery Platform Sector on the Indian Economy report.

About NCAER

India’s largest and oldest economic think tank, NCAER, was established in 1956 as a public-private partnership by the then Commerce Minister T.T. Krishnamachari and J.R.D. Tata. The vision was a newly independent country needing neutral institutions to serve as sounding boards for the government and the private sector. In 2013, Prime Minister Dr Manmohan Singh, a former member of NCAER’s Governing Body, while laying the foundation stone for the new building, suggested that public-private institutions like NCAER ensure economics is both “light-bearing” and “fruit-bearing”.

NCAER’s flagship products include the annual India Policy Forum (the longest-running annual policy conference in India), the India Human Development Survey (India’s longest panel survey data, jointly with the University of Maryland), and the States’ Economic Forum (jointly with NITI Aayog), besides current active policy research work with 12 central ministries and three state governments. NCAER plays an important role in providing India’s policy makers specific, finite, and actionable economic ideas to reconcile a rapidly changing world with our national aspirations for ViksitBarat@2047.