Amazon CEO Jeff Bezos has announced that Amazon will be investing an incremental $1 billion (Rs 7,088.87 crore) to digitise Small and Medium Businesses (SMBs) in the country. However, this is a stark difference from the $2 billion he committed to India during his last visit in 2014. This commitment was eventually increased to $5 billion.
Speaking at the Amazon Smbhav event in New Delhi as part of his 3-day visit to India, Bezos said that the 21st century will be the Indian century. He said that the $1 billion will help bring over 10 million businesses online by 2025.
Amazon’s size and global footprint will be used to export ‘Make in India’ products worth $10 billion to other countries, he announced.
He also said, while speaking at the event that the 21st century would be about the bilateral relations between the US and India.
“In this 21st century, the most important alliance is going to be the alliance between India and the United States, the world’s oldest democracy and the world’s largest democracy,” he said.
And while Bezos attempts to please small businesses and traders on its platform, scores of traders across the country are protesting his visit to India as they allege unfair practices and FDI violation by the company.
Several traders, led by the Confederation of All India Traders (CAIT) took to the streets across 300 cities, chanting slogans such as ‘Go Back Bezos’. In Delhi, the protest was held at Jantar Mantar.
Objecting to Bezos’ visit, CAIT general secretary Praveen Khandelwal claimed that 7 crore traders and their families have been adversely affected due to the predatory business practices of Amazon and Flipkart and labelled them ‘economic terrorists’.
“Amazon and Flipkart’s business model is a breach of every competition law. As a marketplace model, they were supposed to empower the small traders, but their functioning has in fact wiped out small traders who have already been struggling for basic livelihood,” he said.
He further claimed that Amazon and Flipkart have caused GST and Income Tax revenue loss to the government. CAIT has sought a meeting with Finance Minister Nirmala Sitharaman and urged her to investigate the claims.
Interestingly, Bezos’ visit to India also comes at a time when the Competition Commission of India (CCI) has ordered an inquiry into the business practices of Amazon and Flipkart. This was after the Delhi Vyapar Mahasangh alleged that the e-commerce giants give preference to certain sellers affiliated with or controlled by them, which has led to several other traders and sellers having to shut shop.
It also alleged that these platforms are able to influence prices by providing several discounts as well as inventory to some sellers, in turn violating Section 3(1) of the Competition Act, 2002. Furthermore, the Mahasangh alleged that they collect data on consumer preference and use them to their advantage.
Private tie-ups with brands which get more preference in terms of sales, especially for smartphones, excludes other sellers, alleged the Mahasangh.
E-commerce in India is on the brink of a dynamic shift as Mukesh Ambani readies his massive e-commerce foray, which many believe could disrupt the market. The opportunity is huge. In fact, a report by NASSCOM and PwC India in 2018 on the e-commerce market predicted that the market would grow to Rs 10.63 lakh crore by 2022.