Food delivery platforms employed 1.37 million in FY24, says NCAER

For every ₹10 lakh of output generated on such platforms, output yielded for the economy is ₹20.5 lakh

The food delivery platform sector in India employed 1.37 million workers in the financial year 2023-24 (FY24) and is growing at a compound annual growth rate (CAGR) of 12.3 per cent, estimates a new report released by the Delhi-based think tank National Council of Applied Economic Research (NCAER).

 

“The food delivery platform (sector) directly employed 1.08 million workers in 2021–22 and 1.37 million in 2023–24. This formed 0.2 per cent share of total workers in both 2021– 22 and 2023–24. Employment in the sector grew at a CAGR of 12.3 per cent between 2021–22 and 2023– 24, compared to all-India CAGR of 7.9 per cent,” noted the report titled: “Impact of food delivery platform sector on the Indian economy”. 

 

Niti Aayog has estimated the total number of gig workers in the economy at 7.7 million in 2020–21 (FY21), projecting the gig workforce to expand to 23.5 million by 2029-30 (FY30).

 

The study pieces together an entire value chain that stretches from platform development and payment gateways to restaurants and last-mile logistics to “carve out” food delivery as a distinct economic sector that does not currently exist in India’s official statistics.

 

“This sector has the seventh highest output multiplier and the second highest employment multiplier, only after hotels and restaurants, amongst the services sectors,” the report said.

 

The tax multiplier is estimated at 0.04, meaning production worth ₹10 lakh in the food delivery platform sector yielded about ₹ 40,000 in indirect taxes in FY22. With indirect taxes amounting to 4.7 per cent of the sector’s gross value added (GVA), the report concludes that total indirect tax proceeds generated through the sector’s wider economic activity are “almost double” the tax directly attributable to the platforms themselves.

 

The report estimates that the gross value of output (GVO) of the food delivery platform sector nearly doubled from ₹ 61,271 crore in FY22 to ₹1.2 trillion in FY24, raising its share in national output from 0.14 per cent to 0.21 per cent. “The GVO of the food delivery platform sector formed 0.5 per cent of services GVO in 2023-24,” added the report.

 

Over the same period, gross value added (GVA) of the food delivery platforms rose from ₹ 24,315 crore to ₹47,588 crore, or from 0.1 per cent to 0.2 per cent of India’s GVA.

 

“The GVO grew at a Compound Annual Growth Rate (CAGR) of 17.1 per cent and GVA at 16.9 per cent between 2021−22 and 2023−24. For the corresponding period, all India GVO and GVA grew at a CAGR of 8.7 per cent and 7.9 per cent, respectively,” according to the think tank.

 

Talking about the sector’s external linkages, the report highlighted that for every ₹10 lakh of output generated on food delivery platforms, the total output created in the economy is ₹20.5 lakh. NCAER estimates an employment multiplier of 3.41 in FY22 and 3.03 in FY24, implying that an additional ₹10 lakh of platform output generates roughly three jobs across the economy.