Impact of Cybersecurity on E-Commerce in India

Abstract As India’s e-commerce market scales toward a $300 billion valuation, it has become a primary target for sophisticated cyber threats, including AI-driven fraud and ransomware. This paper examines the multifaceted impact of cybersecurity on the Indian digital trade landscape, focusing on financial erosion, consumer trust, and the legislative shift brought by the Digital Personal Data Protection (DPDP) Act, 2023. Statistical analysis reveals that the average cost of a data breach in India has reached a record ₹22 crore ($2.6 million), with malicious bots now accounting for nearly 70% of e-commerce traffic. Through a review of current threat vectors—specifically UPI-based fraud and supply chain vulnerabilities—the study identifies that the "fear of cybercrime" acts as a significant barrier to digital adoption. The paper concludes that for Indian e-commerce to sustain its growth trajectory, businesses must transition from reactive security to a Zero Trust Architecture and AI-powered proactive defence. This research provides a strategic framework for stakeholders to mitigate risks while navigating India’s evolving regulatory and technological environment.