During a visit to India by Amazon CEO Jeff Bezos and following the announcement of a $1 billion investment, the country’s trade minister Piyush Goyal said the eCommerce giant isn’t “doing a great favor to India,” according to reports on Thursday (Jan. 16).
“They may have put in a billion dollars,” Goyal said at the New Delhi security conference Raisina Dialogue. “But then if they make a loss of a billion dollars every year then they jolly well have to finance that billion dollars. So it’s not as if they are doing a great favor to India when they invest a billion dollars.”
While visiting India for the inaugural summit Amazon Smbhav Jan. 15-16, Bezos announced Wednesday (Jan. 15) that the company was going to invest $1 billion to help digitize small and medium-sized businesses (SMBs) in India.
Bezos’s visit was met by more than half-a-million protestors in 300 cities who are against Amazon’s pricing and favoritism. Ahead of his visit, an antitrust investigation was launched by the Competition Commission of India (CCI).
Amazon’s Indian marketplace reportedly lost $802 million in the fiscal year ending March 2019, according to filings on India’s Registrar of Companies. Goyal said the ongoing CCI probe questions why an online marketplace should lose money.
“Anybody who tries to use the eCommerce marketplace model to get into the multi-brand retail space surreptitiously will have to be questioned, will have to be investigated,” he said.
India regulates any direct investment by foreigners in multi-brand retail, compelling Amazon and Walmart’s Flipkart — also under investigation — to revamp selling practices and pull some merchandise for sale.
Amazon’s $1 billion investment in India is intended to help over 10 million businesses digitize and enable exports of India-made goods worth $10 billion by 2025.