Amazon's Bold Indian Strategy

...


ManageEngine OpManager, a powerful NMS for monitoring your network, physical & virtual (VMware/ HyperV) servers & other IT devices. Deploy and start monitoring in less than an hour. Trusted by over a million admins world-wide. Try it for free.

Amazon CEO Jeff Bezos recently announced an expansion of the company's investment in India to the tune of US$3 billion -- that was in addition to the $2 billion in investments it announced in 2014.

Bezos announced the new investment during the 41st annual U.S.-India Business Council Leadership Summit, which was attended by Indian Prime Minister Narendra Modi and several top business leaders.

"We have already created some 45,000 jobs and continue to see huge potential in the Indian economy," Bezos said at the summit.

The "Amazon.in team is surpassing even our most ambitious planned milestones," he added.

Amazon runs 21 fulfillment centers in India and has 85,000 sellers on its e-commerce platform, according to the U.S. Chamber of Commerce.

The company's plans include opening a new region for the Amazon Web Services cloud computing business and building its largest software engineering and development center outside the U.S., the Chamber reported.

"When I peer into the future of India, what I see is unlimited India," Bezos said.

Bezos' announcement followed a recent change in India's restrictions on foreign direct investment, which requires companies like Amazon to act as intermediaries in the local marketplace. Amazon sells much of its inventory through Cloudtail, a joint venture with Catamaran Ventures, the private investment arm of billionaire N.R. Narayana Murthy, who cofounded Infosys.

Amazon earlier this year announced a new10-acre campus in Gachibowli, an IT-focused suburb of Hyderabad, Telangana. The campus will be the largest in India and the company's biggest outside the U.S.

Amazon last year announced the launch of one of its largest fulfillment centers in Hyderabad. The new campus, which will be ready in 2019, will manage back-end operations for various business and technology teams around the world.

Telangana has been home to Amazon's IT operations since 2005.

"It appears that Amazon is seeking to build an infrastructure just for the India market, which is good strategy given the regulatory challenges of being a foreign entity and the different e-commerce environment," said Jim McGregor, principal analyst at Tirias Research.

The investment is part competitive, part political, he said, as it no doubt will curry favor with government officials in India.

"With deep pockets, Amazon can outposition smaller local competitors, while buying goodwill with the powers that be," McGregor observed.

One of the world's fastest-growing e-commerce markets, India currently is dominated by firms like Flipkart, Snapdeal and Alibaba.

Overall, the online retail market in India is only 2 percent of total retail sales in that country, according to Forrester Research. However, growth in e-tailing is exploding, with the market expected to rise at a compound annual growth rate of 44 percent, starting last year, to reach $75 billion by 2020.

David Jones is a freelance writer based in Essex County, New Jersey. He has written for Reuters, Bloomberg, Crain's New York Business and The New York Times.

Categories
Guide
0 Comment

Leave a Reply

Captcha image


RELATED BY

  • 5300c769af79e

    WhatsApp Update With Quick Reply, Other Features Exits Beta

    Back in late March, the beta for WhatsApp received a sizable update, one that included quick reply from notifications, wallpapers for chats and multiple contact selection.At last, that update is now rolling out to everyone, exiting the beta stage.
  • 5300c769af79e

    12 Must-Have iPhone Apps

    The first iPhone couldn't even run third-party apps, if you can imagine that, but since then those apps have been paramount to the phone's success.The iPhone comes with many very capable and useful apps pre-installed, including ever-improving Maps, Messages, Music, News, and Photos apps.
  • 5300c769af79e

    Netflix Casting From Google Home Should be Up and Running Now

    A few days ago, folks began noticing that you could link Netflix and Google Photos on your Google Home.Now, it’s totally official from Google and saying, “OK Google, play Stranger Things from Netflix on my TV” is a real thing.
  • 5300c769af79e

    Malware Turns ATMs Into Cash-Spewing Jackpots

    But while Buhtrap looted ATMs via fraudulent wire transfers, the ATM scammers reportedly use a less hands-on method: "touchless jackpotting.The hackers reportedly use a penetration testing tool known as Cobalt Strike, which lets them access servers that control ATMs via bank PCs infected by malicious emails.