Ease of doing business for MSMEs: Launched in June 2013 as a viable third front in the e-commerce battle between Flipkart and Snapdeal in India, Amazon, the world’s most valuable e-commerce company has completed its 10 years in the country. Starting operations with 100 sellers and a selection of mainly books, Amazon India currently has more than 12 lakh sellers and has digitized over 40 lakh small businesses, the company said in a statement commemorating its decade-long journey in India. The majority of sellers on the e-commerce marketplace are MSMEs.
Among offerings introduced in India, the company had launched its Global Selling programme in 2015 to help Indian exporters sell online to Amazon’s international websites and marketplaces. Over 1 lakh exporters from India have been part of the programme and MSMEs exporting through the programme have surpassed $5 billion in cumulative sales while over 11 lakh direct and indirect jobs have been created, according to the company.
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In May 2022, the company had announced doubling its cumulative export target of ‘Made in India’ goods from MSMEs under its global selling programme to $20 billion by 2025 from an earlier $10 billion mark announced in 2020.
Moreover, the company’s digital payments solution Amazon Pay, introduced in 2019 in India, has more than 85 lakh small businesses as merchants while over 8 crore customers use the Amazon Pay UPI.
“We are truly just getting started and remain committed to innovate for crores of customers and sellers. It is exciting that our pledges of digitizing 1 crore SMBs, enabling $20 billion in ecommerce exports and creating 20 lakh jobs by 2025 align with India’s vision of becoming a $5 trillion economy,” said Manish Tiwary, Country Manager India Consumer Business, Amazon India.
Moreover, the company’s cloud computing subsidiary Amazon Web Services (AWS) in March this year had announced the launch of its cloud solutions programme AWS Lift for SMEs as part of its aim to digitise small businesses in the country.
According to the company, AWS had invested over $3.7 billion in India between 2016 and 2022 while its Asia Pacific (Hyderabad) Region, launched in 2022, is estimated to support more than 48,000 full-time jobs annually through a planned investment of more than $4.4 billion in India by 2030.
In terms of credit to sellers, while Amazon in the US enables financing through its Amazon Lending programme, in India it enables credit via third-party lenders since the company did not have a banking license.
However, the journey hasn’t been entirely smooth for Amazon in India. From concerns raised around regulatory compliance and alleged unethical business practices claimed by traders and offline retailers to shutting down its key seller Cloudtail (JV of Amazon and Infosys founder Narayana Murthy’s family office Catamaran Ventures); laying off employees; shutting down businesses such as its food delivery business, edtech venture Amazon Academy and wholesale distribution business Amazon Distribution; fight over Future Retail against Reliance Industries; competition from Flipkart and Meesho and other digital ventures of large corporates such as Reliance and vertical players viz., Blinkit, Zepto etc., other than the government’s open e-commerce network ONDC; and more, the company has faced multiple headwinds.
Importantly, a report by research firm Bernstein last year had noted that there is ‘immense competitive pressure’ for Amazon India in new segments such as grocery from companies like Reliance and Meesho. The biggest challenge, according to the report, for the company, was regulatory issues even as India is among the biggest and fastest-growing overseas markets for Amazon.