Amazon reveals scorching growth in India as Flipkart fight deepens

Amazon.com Inc. offered a rare peek into the Covid-era growth of its Indian business while it battles Walmart Inc. in its biggest overseas market.
 

The US online giant said it has enabled exports of Indian-made goods worth $3 billion and created over a million local jobs since it began operating in the Asian nation about a decade ago -- about $1 billion of that and 300,000 jobs since January 2020 alone. About 250,000 new sellers have joined Amazon.in since and more than 50,000 offline retailers and neighborhood stores are now on the platform, the company’s country chief said.

The numbers illustrate the frenetic pace of growth in Indian online retail after the pandemic accelerated buying and selling in segments beyond smartphones and fashion. But Amazon has to contend with Walmart’s Flipkart and homegrown competitor Reliance Industries Ltd. in India, an increasingly important growth market since Amazon’s exit from China about a decade ago. American firms also face tightening regulations, antitrust scrutiny and accusations they’ve elbowed local players aside.

Amazon India chief Amit Agarwal said the Seattle giant is on track to fulfill commitments made when founder Jeff Bezos visited the country in January 2020: to digitally enable 10 million businesses, handle e-commerce exports worth $10 billion and create 1 million additional jobs in India in the five years to 2025.

"Covid-19 has made businesses realize they need to be more resilient, robust because there’s no notion of only offline or only online anymore," Amazon India chief Amit Agarwal said in a phone interview on Thursday to discuss the unit’s progress. "The internet is like electricity, everybody will use it."

Bezos has made India the centerpiece of his global ambitions, a burgeoning market for not just online goods but also video content and gadgets. The country, one of the last big consumer markets still up for grabs, will generate $200 billion in e-commerce sales by 2026, Morgan Stanley estimates.

It’s also a source of talent. Amazon has hired locally in fields like machine learning and software development, while employing an army to staff its giant fulfillment centers. It’s also profiting by helping more than 70,000 Indian exporters sell everything from toys and bed linen to jewelry and tea to 300 million customers across 200 countries.

Reliance and Flipkart, which is said to be preparing for a fourth-quarter initial public offering, are employing the same playbook but Agarwal said Indian e-commerce remains embryonic and can support several major players.

Amazon will focus on local execution while complying with local regulations as they evolve, he added. The Ministry of Commerce and Ministry of Information Technology have been pondering a raft of laws and rule changes to protect consumer data and eradicate anticompetitive practices, while a backlash against US and Chinese internet giants grows. Agarwal said Amazon is compliant but stressed a stable regulatory system -- particularly during a time of heightened global uncertainty -- was essential to drawing more investment into India.

"We are more than happy to be inspected, our job is to focus on the customer and India is a long term investment for Amazon," he said. He said it’s not the time to make changes. "Changes are very disruptive and any rule changes require adherence and changes on our part."