Two US consumer giants—Amazon and Walmart—are prepping to bankroll the next phase of e-commerce warfare in India, home to more than 1.3 billion people. Amazon has recently pledged to pour in more than $5 billion to further expand its business in India. Meanwhile, Walmart has acquired the largest e-commerce store in India, Flipkart. All these developments point to a very competitive Indian e-commerce scene in the next decade.
Indian e-commerce developments
According to Bloomberg, Walmart will acquire up to 80 percent of Flipkart for a value of $12 billion which could raise the value of the Indian firm to $20 billion. Last year, it was valued at $12 billion after landing a $1.4 billion investment from various firms like eBay and Microsoft.
It is said that Amazon tried a last-minute move to acquire Flipkart but the latter’s founders favored dealing with Walmart instead.
Indian e-commerce growth
It is not surprising that these two fierce rivals are doing these things. After all, India is not only one of the most populous countries on the planet. It also has an emerging e-commerce market. A report by the Internet and Mobile Association of India predicts that India will have half a billion Internet users by the middle of 2018. Internet penetration is mainly concentrated in the urban parts of the country. Morgan Stanley believes that the Indian digital market will be worth $200 billion by the year 2026.
The increased focus of Walmart on the Indian market comes in the heels of its exit from the Chinese market two years ago after it sold Yihaodian service to JD.com. Walmart worked closely with the Chinese e-commerce giant by using JD.com as a storefront for reaching out to Chinese customers.
Amazon has also not made secret its plans to diversify. It recently announced having more than 100 million Amazon Prime members globally and cited the growing number of members in India thanks to the intensive promotions it conducted in the said Asian country.