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Bezos commits to invest an additional $3 billion into Amazon India

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The e-commerce company Amazon has decided to invest another $3 billion to solidify its business and accelerate its growth in India. This news comes just days after Amazon decided to infuse additional $200 million funds into strengthening its operations in India.

The additional investment adds fuels to Amazon’s ambition to conquer the fast-paced Indian e-commerce market and pile on more pressure on the homebrewed e-commerce startups, like Flipkart and Snapdeal. This also highlights the total Rs. 8,618 crore that the multinational e-commerce corp has spent on discounts, advertising and logistics in the past two years.

The latest commitment comes directly from the founder and CEO Jeff Bezos himself, who announced the investment of the additional funds at the U.S.-India Business Council’s Leadership Summit in Washington, in the presence of PM Narendra Modi.

This investment from Bezos doubles the pledged amount that Amazon had decided to pump into the Indian market.

He in a statement to the council also added that,

We have already created some 45,000 jobs in India and continue to see huge potential in the Indian economy. Our Amazon.in team is surpassing even our most ambitious planned milestones.

In July 2014, just a year after its debut in India, Bezos had decided to invest a hefty sum of $2 billion into the Indian wing of the company over time. But the company has shocked the world by aggressively working on beating the favored e-commerce players in the country(ahem, Flipkart!) and burning through the cash in just a span of two years.

Colin Sebastian, an analyst at Robert W. Baird & Co airs his views on the investment news and says that,

The added investment reflects the success to-date of Amazon in India, as well as a bright outlook for the e-commerce market in the region. It’s really down to a two or maybe three-horse race, and Amazon clearly would like to be the winner.

Amazon India has been throwing money away like water to take lead over the coveted Indian e-commerce player in India, Flipkart. Alexa data already shows that the e-commerce company’s plan seems to be working as it has consistently been ahead of its competitors in terms of traffic.

As we had reported earlier, the company doubled its authorized capital to around ₹16,000 crore indicating that Amazon is ready to infuse as much cash as possible, to be at the pole position in India. While Amazon has been winning the war at hand, Flipkart has been trying hard to up it game(and revenues) by introducing new policies like No Cost EMI’s and 10-day replacement policy — instead of 30 days.

Morgan Stanley has devaluated the Indian e-commerce company Flipkart, dropping its valuation to about half at which the company had recently raised funds. Amazon however isn’t backing down to conquer the only developing market that it has full control on, after losing its grip on China to Alibaba.


 

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