Amazon pumps Rs 2,800 Cr into its Indian marketplace
US-based ecommerce giant Amazon has pumped in Rs 2,800 crore into its Indian marketplace. The fresh infusion comes six months after the online retailer infused Rs 2,200 crore into its Indian entity last December, documents filed with Registrar of Companies (RoC) revealed.
The funds come from two of Amazon group’s entities: Amazon Corporate Holdings Pvt Ltd, Singapore, and Amazon.com Inc Ltd, Mauritius.
Amazon Founder and CEO Jeff Bezos
This is also the first fund infusion for the Amazon India marketplace after the Indian government released the draft ecommerce policy in February this year. The policy envisages setting up a legal and technological framework for issues as varied as cross-border data flow, anti-counterfeiting measures, digital economy, taxation, and other regulatory issues.
The development also comes on the back of India's new foreign investment rules introduced in February this year. The new FDI rules bar companies like Flipkart and Amazon from selling products through companies in which they have an equity interest and from having exclusive agreements with sellers to sell on their websites. The policy was aimed at deterring deep discounts and helping small traders.
Media reports have claimed that deep discounts and offers on both platforms have come down drastically following the new FDI rules. However, Amazon India has been expanding its logistics and fulfillment capacity, and has been tying up with an increasing number of sellers to take them online.
Meanwhile, rival Flipkart has seen no fund infusion from its parent in this financial year. The last time when Flipkart Internet (Marketplace) got funds was in September last year; Flipkart Singapore then pumped Rs 34.6 billion into the Indian marketplace.
The Amazon Indian marketplace’s operational revenue was Rs 4,928 crore in FY18, while the Flipkart marketplace’s operational revenue for FY18 was Rs 2,790 crore.