Despite making losses in the Indian venture and facing stiff opposition from the traditional retailers’ lobby, Amazon appears to be keen on investing more money in its Indian arm. The digital payments arm, Amazon Pay, for example, is reported to have received ₹1,355 crore from two entities, Amazon Corporate Holdings Pvt Ltd and amazon.com.incs.Limited. These companies have been allotted the shares from Amazon Pay in lieu of this investment.
Similarly, the wholesale business in India, handled by Amazon Wholesale (India) Pvt Ltd has been pumped in around ₹360 crore and this amount too has come from the same two entities, Amazon Corporate Holdings Pvt Ltd and amazon.com.incs.Limited, against shares.
These details have been sourced from the mandatory filings by Amazon with the Indian Ministry of Corporate Affairs.
These developments are getting reported right when the Amazon founder Jeff Bezos is in India. As mentioned above, the Indian trade body is opposing the practices followed by Amazon and Flipkart in their e-commerce platforms, particularly deep discounting. Spearheading their agitation is the Confederation of All India Traders or CAIT. This organisation has planned to hold protests against Amazon during the visit of Bezos wherever he is expected to visit in the country.
Jeff Bezos is making the visit to India to hold a series of meetings with top government officials, representatives of small and medium businesses and other business leaders. There have been several issues the e-commerce player has had to face and some of them may not go away soon.
There has been a report from the Competition Commission of India, or CCI that the regulator has initiated a probe against Amazon and Flipkart. The accusation against them is that they are in violation of competition laws.
The two US giants have however never shied away from pumping in more funds to stay with and expand their operations in the country. They see considerable benefit in this vast market and some of the areas where they are investing in their business include marketplace, infrastructure and supply chain management as well as marketing and promotion.
Despite posting cumulative losses of over ₹7,000 crore till the last financial year 2018-19, Amazon has invested another ₹4,000 crore in October 2019.