Convenience economy at the heart of India’s services surge, foreign investment uptick: Report

The services sector is driving 55% of India’s GDP, powered by rising consumer demand for speed, comfort, and digital-first experiences, according to the Axis Services Sector Report. The rising consumer base in the convenience economy is fuelling growth in quick commerce and hyperlocal delivery segments, with companies like Swiggy, Zepto, and Blinkit becoming essential services. This is also attracting foreign investments to the segment, the report says.

According to the report, nearly 40% of Indian consumers are ready to shell out more for products and services that simplify life. 

India’s economy is undergoing a massive transformation, and at the heart of this shift is the services sector, which now contributes 55% to the national GDP, far outpacing agriculture and manufacturing, it adds.

The convenience economy

As more Indians are willing to pay extra for comfort and speed, the expansion is not just statistical; it's deeply personal, impacting how we shop, eat, stream content, invest money, and even seek healthcare, the report states. 

The Indian convenience food market alone is projected to grow from $10.1 billion in 2024 to $37.9 billion by 2033, at a CAGR of 15.01%—a strong indicator of this consumer shift. 

"This willingness to pay for "additional service" signifies a profound behavioural shift, driven by urbanisation, digital penetration, and evolving consumer expectations for instant gratification, all underpinned by advanced logistics and technology," reads the report.

While you order groceries in 10 minutes, India’s healthcare sector is seeing a parallel digital transformation. According to the Axis report, the sector clocked in a 62% year-on-year growth in March 2025, driven by AI, data analytics, telemedicine, and health informatics. From diagnostics on your phone to robotic surgeries, healthcare is no longer limited to hospitals—it’s a fast-growing, service-led, and tech-driven investment avenue. The sector is projected to touch $370 billion by 2027, up from $17 billion in 2000.

Premium, the new normal

More than 50% of e-commerce sales now come from premium segments, says the report. Whether it’s choosing Urban Company over a local parlour, or paying for Netflix over cable TV, Indians are showing a strong appetite for high-quality, digitally delivered services. The online retail market is expected to grow from $103 billion in 2024 to $325 billion by 2030, and this consumer behaviour is turning everyday choices into large-scale investment opportunities, the report says. 

A magnet for global money

It is not just domestic money, but the world, too, is watching the services boom. In FY25, India’s services sector attracted $9.35 billion in FDI, up 40.77% from the previous year, making it the top recipient of foreign equity inflows, according to the report. Private equity and venture capital funds are also doubling down, particularly in consumer services, healthcare, fintech, and digital platforms, signalling strong future earnings potential.

From what you order for dinner to how you pay your bills, see your doctor, or invest your salary, services shape every aspect of modern Indian life. The Axis report rightly says that this sector isn’t just growing, it is redefining India’s economy and offering one of the most inclusive and accessible investment themes for common investors.