Amazon’s Jeff Bezos visited India to announce an increased investment in the country. His visit is not without controversy. Less than 24 hours prior to his visit, India’s anti-trust regulatory body, the Competition Commission of India, opened a formal investigation into the business practices of Amazon and its Indian competitor Flipkart, which is partially owned by Walmart. The two companies represent the vast majority of the Indian online market.
His visit also sparked protests by owners of brick-and-mortar stores around the country. In addition to allegations that Amazon undercuts small businesses and drives them out of business, small business owners allege that Amazon strikes preferential deals with certain sellers, resulting in the others being “foreclosed from the online marketplace.” These concerns led to protests in 300 cities, which were planned to coincide with Mr. Bezos’ visit to India. The protests were organized by the Confederation of All India Traders, a union that represents around 70 million merchants around the country.
Amazon’s experience in India demonstrates both the risks and opportunities of investment in the country. On the one hand, India is happy to receive foreign investment to kickstart its slowing economy, and Indian consumers have generally proven eager to adopt e-commerce as a means of doing business. On the other hand, in 2019 the Indian government, with the support of Indian brick-and-mortar shopkeepers, tightened the rules for e-commerce marketplaces with foreign investment, and shopkeepers are currently pushing for more protectionist legislation.
