It noted that in the neighbouring country of Bangladesh, too, the online sales a mere 0.7 percent of total retail sales, while that in China is 15 percent and around 14 percent globally.
The report titled, "Unleashing e-commerce for South Asian Integration" jointly released by World Bank Group and Cuts International said that e-commerce can become a driver of growth across South Asia and boost trade between in the region, but its potential remains largely untapped.
Increasing the use of e-commerce by consumers and firms in South Asia could potentially help increase competition and firm productivity, and encourage diversification of production and exports, it said.
"E-commerce can boost a range of economic indicators across South Asia, from entrepreneurship and job growth to higher GDP rates and overall productivity," said Sanjay Kathuria, World Bank Lead Economist.
A survey of over 2,200 firms in South Asia showed that the top concerns on cross-border among the South Asian countries in e-commerce include logistics, e-commerce and digital regulations, and connectivity and information technology infrastructure.
These barriers are significantly higher when trading with other South Asian countries, the report. The main international e-partners of firms in South Asia are China, the United Kingdom, and the United States.
Small and medium enterprises in the region reported that removing regulatory and logistical challenges to e-commerce would increase their exports, employment, and productivity by as much as 20-30 percent. To overcome these hurdles, the report proposes reforms in areas such as payments, delivery, market access regulations, consumer protection, and data privacy, at the national, regional, and global levels.