Credits: Wikimedia Commons

It seems that the pressure created on Amazon is having its effects. Hours after Amazon and Flipkart failed to halt the probe by the CCI, the US-based e-commerce behemoth announced that it would be parting ways with N.R. Narayana Murthy-owned Catamaran Ventures, thereby ending Prione Business Services, their joint venture, and not renew the seven-year-old partnership when it comes up for renewal next year.

This means the Cloudtail, one of Amazon’s largest sellers in India and a result of the joint venture, would be stopping operations from May 2022. The joint venture has enabled over 300,000 sellers and entrepreneurs to go online and with a presence in 30 cities across the country, enabled 4 million merchants with digital payment capabilities, providing these SMBs and merchants access to millions of customers across the country. The announcement was made in a joint statement.

“As our JV with Amazon reaches the end of its tenure, I reflect on this successful partnership that introduced the power of digitization and empowered hundreds of thousands of SMBs across big and small towns,” said M.D. Ranganath, President of Catamaran. However, the exact reason for the end of the joint venture has not been stated.

“We are humbled by how the JV exceeded its vision, helping online commerce evolve through the unrelenting efforts of hundreds of its employees, positively impacting over 4.3 million small businesses, creating hundreds of thousands of jobs, and contributing to India’s digital economy. We were privileged to have had a partner we could learn from and lean on. I would like to thank the Catamaran team for this long and fruitful partnership that helped set the direction for e-commerce in India,” said Amit Agarwal, Global Senior Vice President and Country Head of Amazon India.

Cloudtail has been named as one of the sellers to receive preferential treatment by Amazon, which is already in hot water for employing anti-competitive practices and violating and circumventing Indian laws. It, along with Flipkart, has been accused of abusing its dominant position in the market to stifle competition. Amazon has maintained that it does not give preferential treatment to any seller and that it complies with the law. Investigations have shown that Cloudtail, said to be an independent seller offering goods on its marketplace website, is a way for Amazon to circumvent the country’s foreign investment laws.

Recent times have been tough for e-commerce firms which have for a long time bypassed Indian laws through loopholes. Harsh criticism from trader associations and politicians has drawn attention to their dirty laundry, and tougher e-commerce rules have made things tougher for them.