Jeff Bezos’ Amazon invests $1 billion in India. Traditional retailers scream “go home!”
It’s been a long time coming, but Amazon CEO Jeff Bezos has revealed that his mega-retailer has invested $1 billion in the Indian market, and will invest a further $10 billion over the next five years.
The investment comes a few months after Bezos revealed his company's first plans to establish a physical presence in India — a strategic move seen as a start towards building a platform to compete against homegrown online retailers.
“We want to be more than a seller for these tens of millions of sellers,” he told reporters at Amazon’s India hub in Mumbai.
In a press conference on Thursday, the e-commerce giant also revealed that it had created 21,000 jobs in the country since it officially launched in 2011.
Amazon Prime — the company’s shipping membership program — is now available in India, enabling millions of Indians to get free delivery on some of their purchases with no minimum purchase amount.
India’s fast-growing e-commerce market is expected to explode in the coming years — and in the present tense, traditional brick-and-mortar retailers are fearful that Amazon could eat into their share of the pie.
Bezos’ big announcement sent shockwaves through traditional retail communities across the country. Earlier this month, authorities in Mumbai had warned Amazon against investing a significant amount of money in the country, including threatening prosecution.
“I think India is the most important country in the world, and the most important thing for India is having an economy that supports companies and can create jobs for Indians,” he added.
On Thursday, however, the Amazon boss said that his company is not interested in competing directly with traditional retailers — at least not just yet.
“We are interested in a very particular kind of retail business. It’s called commerce, it’s called engaging with customers,” he said.
Bezos also criticized the Indian government for seeking to limit foreign investment in the country’s e-commerce sector. “My understanding of the current regulatory and legislative environment is that it is taking steps to treat foreign direct investment as any other form of investment and therefore restrict it,” he said.
The Indian government has already threatened to cap foreign investments in e-commerce companies.
“There’s very good sense in the ‘trust me’ stuff. I think that people think they are not [implementing] in a smart way,” Bezos said.