By Amit Kapoor and Nabha Joshi
The promise of meeting every need, from restocking the kitchen to outsourcing household chores, is becoming a defining feature of India’s urban consumer economy. These services are part of an expanding gig economy estimated to engage 12 million workers and expected to grow to 23.5 million by 2029-2030. New entrants are expanding the market by competing to deliver a wider range of needs through on-demand services, while established platforms strive to reach their profitability potential. As this economy grows, one must question: what sustains this promise of ever-cheaper, ever-faster service? The answer matters because it reveals what this expansion rests on: innovation and productive capacity, employment opportunity, or the efficient commercial organisation of readily available labour.
Understanding its scale and competitive landscape means looking at the business structures and strategies that allow firms to deliver services and capture value, and at the employment they create.
The quick commerce ecosystem is a capital-intensive, factor-driven business. It relies on dense dark store networks, high-frequency inventory management, algorithmic dispatch, and rider fleets built for expedited last-mile delivery. The promise of instant delivery rests not on proprietary technology but on cheap labour, product assortment, and the capacity to finance rapid expansion. The platform brings consumer demand and an available workforce together, allocating workers to the service required. Beyond the digital interface, gig workers shoulder much of that promise, owning the vehicle, phone, and tools it demands.
Their real advantage often comes from labour arbitrage: the ability to draw on a vast supply of relatively cheap, weakly protected labour, organise it efficiently through digital systems, and convert that social asymmetry into profit. Digital systems allow platforms to organise a vast, often informal workforce across cities, mobilising, allocating and monitoring workers without assuming the full costs and obligations of conventional employment. Fixed employment costs become a pay-per-task or piece-rate system that supports stable wages, while riders bear the costs of timely delivery, safety, demand fluctuations, and rating penalties for delays beyond their control. Technology routes orders, predicts demand and monitors performance, yet the pursuit of competitive advantage remains factor-driven.
These operational models raise a wider question about the kind of enterprise India’s ecosystem rewards. In an economy marked by high friction, organising a fragmented system of products and services matters, provided it catalyses new products, technologies, and capabilities rather than becoming an end in itself. The true measure will be whether firms convert operational scale into proprietary capabilities that raise output and value per worker, or keep expanding through the addition of capital, dark stores, and low-cost labour.
Their expansion also assumes that cheap labour will persist and that workers will keep accepting its costs and uncertainties. That assumption alone invites questions about labour market conditions. During the pandemic, gig work offered immediate earnings, low barriers to entry, and flexibility, and it still suits part of the workforce, including students, migrants, and women who left full time employment for caregiving. Yet the rise of 55%, roughly 4.3 million additional workers between 2021 and 2025, now up to 2% of India’s total workforce, cannot be ascribed to a growing preference for flexibility alone. It must also be read against the availability of stable employment, the returns on education, and the chance to use and build skills.
NITI Aayog estimates that 47% of gig work is medium-skilled, 31% low-skilled, and 22% high-skilled. Some enter because they hold the qualifications and value the platform’s autonomy. Others hold qualifications the wider economy has failed to match with suitable work, and some join as a last resort after limited access to education and training. The result is a large workforce with minimal credentials. Understanding these motivations helps identify whether the problem is a human capital deficit, an opportunity gap, or both.
A 2024 ILO report finds that gig work is often entered as supplementary employment before it takes on the demands and hours of a full time job. Platforms draw heavily on informal economy workers attracted by the promise of higher earnings once middlemen are removed. In practice, many report that wages have fallen since they joined, as subsidies and incentives change. The Economic Survey for 2025 and 2026 records that around 40% of gig workers earn less than ₹15,000 a month. Furthermore, the Fairwork India Ratings 2024 report highlighted that none of the surveyed digital platforms ensured that all workers earned a local living wage after deducting work-related costs. While BigBasket and Urban Company maintained minimum wage policies, none of the 11 platforms surveyed met the threshold for a “living wage.”
Along with current earnings, the prospect of higher future earnings also matters; the key question is whether these jobs offer avenues to increase income through work that builds recognised skills, improves productivity, and ultimately provides a path to better employment. A labour market that offers entry points without a credible route for advancement may create jobs only in the short term, with no prospect of upward mobility.
Here, the two sides of the gig economy converge. Limited alternatives to mobility in employment weaken workers’ bargaining power, while the resulting supply of flexible labour makes businesses built around task-based work easier to finance and expand. These enterprises can absorb large numbers of workers without necessarily developing their capabilities or generating pathways into higher-value employment. These missing connections between education, skills, and suitable jobs; between work experience and advancement; and between entrepreneurial success and broader productive development create institutional voids.
The allure of 10-minute service systems shouldn’t be an ideal for India’s expanding businesses. India’s digital infrastructure offers a platform for innovation, scaling, and efficiency. This should be a launchpad for deepening skills, developing technologies, and expanding capacity, not just organising labour and inequalities for quick gains. In a competitive world with new tech and AI, failing to innovate risks relegating India to low-value roles. As economies push frontiers, India must move beyond models relying on cheap labour and logistics advantages.
(Amit Kapoor is Chair & Nabha Joshi is Senior Researcher at the Institute for Competitiveness. X: @kautiliya)
The article was published with The Sunday Guardian on September 20, 2026.
