Economy News

Unicorns to add $1 trillion to economy by 2030, generate 50 million jobs: CII-McKinsey study

The first unicorn was seen in India in 2011, and after a decade, India has crossed the mark of 100 unicorns. The combined valuation of 113 unicorns is $350 billion as of January 2024.

New unicorns are likely to add $1 trillion to the Indian economy, which would reach $7 trillion size by 2030, and add 50 million new jobs, according to a report released by industry body CII on Thursday. Startup firms valued over $1 billion are categorised as unicorns.

The report ‘Unicorn 2.0: Adding the Next Trillion’ has been prepared with McKinsey & Company as the knowledge partner, CII said.

Sectors such as retail and e-commerce, next-gen financial services, manufacturing, and SaaS and digital are poised to drive massive growth in the coming years.

The first unicorn was seen in India in 2011, and after a decade, India has crossed the mark of 100 unicorns. The combined valuation of 113 unicorns is $350 billion as of January 2024.

The industry body said that the emergence of over 100 unicorns is a remarkable achievement, attributed to several pivotal factors, which encompass a digitally adept young population facilitated by widespread access to mobile internet, the growth of the middle class, and a supportive regulatory framework. CII president R Dinesh stated that the startup ecosystem is a vibrant tapestry woven with threads of innovation, resilience, and transformative ideas.

“As we dissect the components that foster growth, we navigate through the realms of economic contribution, job creation, and ground-breaking innovations that redefine industries,” he said.

According to the findings of the CII report, India’s 100-plus unicorns and about 100,000 startups have contributed a significant 10-15% to GDP growth between 2016 and 2023.

Moreover, rapid digitization has not only transformed urban centres but has also permeated rural areas, catalysed inclusivity and driving the creation of 20-25% of all new employment opportunities.

Startups are playing a pivotal role in powering India’s economy across 9 sunrise sectors – manufacturing; IT and digital services; agricultural ecosystems; healthcare services; travel and tourism, modern retail and e-commerce; next-generation financial services; communication, media and entertainment; and skills and education. These sectors not only serve as current growth engines but are also projected to spur further growth, employment, and can have 20-23 times impact on exports by FY30.

India is home to 20 times more startups today than in 2015, going from 4,000 to over 100,000. Startups and related corporate ventures have contributed an estimated $140 billion in economic value in FY23.

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