India’s New-Age Economy Set To Triple To $300 Billion By FY31, Driven By AI, Digital Innovation And Startups

India’s new-age economy is likely to expand nearly three times to around $300 billion in revenue by financial year 2030-31, compared with nearly $100 billion estimated in FY26, according to a report by Business Standard citing Redseer Strategy Consultants.

The sector includes digitally driven companies that use technology as a core business engine, with growth being fuelled by artificial intelligence, digital platforms and innovation.

Revenue generated by domestic new-age companies has increased from $33 billion in FY22 to nearly $100 billion in FY26, and the sector is expected to grow at an annual pace of about 25% until FY31.

Consumer brands and technology sectors lead growth

Consumption-focused segments such as consumer goods, retail and leisure are expected to remain the largest contributors, reaching around $150 billion by FY31. However, growth in these areas is projected to moderate from earlier levels as the market matures.

Technology-led sectors, including technology, media and telecom (TMT), AI and advanced manufacturing, are expected to grow slightly faster at about 26% annually. Their contribution to the overall new-age economy is also likely to increase.

The report noted that the combined profit pool of new-age companies turned positive in FY25 at $1.4 billion, although profitability remains concentrated mainly in banking, financial services and insurance (BFSI).

Startups attract funding as brands scale faster

Consumer-focused startups are scaling rapidly due to direct-to-consumer channels and quick commerce. The time taken by brands founded in 2020 to achieve ₹100 crore in revenue has reduced to 3.4 years from 6.8 years for companies established in 2016.

Despite faster growth, scaling beyond ₹500 crore remains difficult due to challenges involving offline distribution, retail expansion and working capital requirements.

Private funding for new-age companies is expected to rise 25% year-on-year to $17 billion in 2026. By 2030, combined public and private fundraising could reach $50 billion annually, with new-age companies projected to contribute around 40% of Indian IPO proceeds, up from 25% currently.