Amazon to invest $2b in India; on track to hit $1b sales

Tags: Amazon, Companies
Upping its ante in India's fiercely competitive online shopping space, e-commerce giant Amazon today said it will invest $2 billion in the country to grow the business in a market that is dominated by homegrown players like Flipkart and Snapdeal.

The US-based firm's announcement comes less than 24 hours after rival Flipkart announced raising a whopping $1 billion funding, the largest in the e-commerce space in India.

Amazon, which launched its marketplace in India last year, said the country is one of its fastest growing markets and is on track to touch $1 billion in gross sales.

It will invest an additional $2 billion to support its rapid growth and continue to enhance the customer and seller experience in India, Amazon said in a statement.

"After our first year in business, the response from customers and small and medium-sized businesses in India has far surpassed our expectations," said Jeff Bezos, founder and CEO of Amazon.Com.

The company sees huge potential in the Indian economy and for the growth of e-commerce, he added.

"With this additional investment of $2 billion, our team can continue to think big, innovate, and raise the bar for customers in India," he said.

At current scale and growth rates, India is on track to be Amazon's fastest country ever to a billion dollars in gross sales, he said.

"We have never seen anything like this," Bezos said. In India, Amazon sells over 17 million products across categories like books, apparel and electronics from a growing base of thousands of small and medium-sized businesses.

Apart from smaller e-commerce portals, Amazon competes head on with Flipkart and Snapdeal. In the past few months it has raised the bar with introducing same-day delivery and ramping-up its logistics among others.

Earlier this week, Amazon said it will open 5 new centres across India in addition to its two fulfilment centres (FCs) in Mumbai and Bangalore. The FCs will be set up in Delhi, Chennai, Jaipur, Ahmedabad and Tauru (outskirts of Gurgaon).

This, it said, would help in faster delivery of products. With the addition of the five centres, Amazon's total storage capacity will almost double to over half a million sq feet.

EDITORIAL OF THE DAY

  • Finance minister has been pragmatic in exempting FIIs from MAT claims

    Good sense has finally prevailed in the government, with finance minister Arun Jaitley announcing the income-tax officials will exempt overseas funds

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

Sarthak Raychaudhuri

vice-president, HR, Asia South Whirlpool of India

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

TODAY'S COLUMNS

Amita Sharma

Centre set to scrap 60:40 norm for NITs

A committee set up by the ministry of human resource ...

Zehra Naqvi

If you bend, you won’t break

There’s an ancient exercise about a green, supple new branch ...

Gautam Gupta

Bring on the Benares brigade

It was in 2003 when I first started work and ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture