Amazon is struggling to win over Indian consumers. This has not been easy.


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One of 20 million small Indian grocery stores becoming key partners for Amazon, Mukesh Ambani’s Reliance Industries and Walmart’s Flipkart online unit.

Dhiraj Singh/Bloomberg


com’s playbook prevailed in the US On Thursday, the company reported sales of $280 billion in North America for its final year.

The sales figure makes Amazon (ticker: AMZN) arguably the most dominant Big Tech player in the domestic market. On the other hand, Amazon is more dependent on the United States than any of its Big Tech peers.

About 59% of Amazon’s revenue came from the North American market in 2021.


(MSFT) is a distant No. 2, with exactly 50% of its last calendar year sales based in the United States, according to Bloomberg and FactSet estimates.

The geographic spread makes Amazon’s efforts to expand overseas particularly important, especially with growing regulatory scrutiny in the United States. But Amazon’s international growth hasn’t been easy, particularly in India, where the e-commerce giant has long sought a foothold.

In 2019, Amazon agreed to pay $200 million for a 49% stake in Future Coupons, a gift voucher unit of India’s second-largest retailer.

Retail of the future

But nearly three years later, Amazon is still struggling to close the deal. He is embroiled in a bitter legal battle with Reliance Retail, led by India’s richest man, Mukesh Ambani. Reliance rushed to buy Future Retail for $3.4 billion in 2020. Amazon, which had ultimately hoped to buy all of Future Retail, argued that its smaller deal with Future Coupons prohibited Future from selling its retail assets. retail to competitors like Ambani’s Reliance. Future, Reliance and the Competition Commission of India (ICC), India’s antitrust agency, disagree.

Amazon, in its investor calls, has repeatedly spoken about its efforts to expand Prime into India, which is a relatively untapped e-commerce market. According to an estimate by Forrester Research, only 4% of total retail sales in India took place online last year. This compares to around 24% in the US and 18% in Europe.

Losing on Future Group won’t hurt Amazon’s sales, cash flow, or stock price, at least not in the short term. On Thursday, Amazon announced $470 billion in total sales for 2021, up 22% from a year ago.

But before Thursday’s earnings report, Amazon shares had largely been flat for the past 18 months, lagging the rest of Big Tech in 2021. Gaining ground with India’s 1.4 billion consumers would be a nice next act.

“India is important to Amazon,” said DA Davidson analyst Tom Forte. To the extent it is able to move forward, the acquisition should improve its ability to tap into an important emerging market, he said. Barrons.



(WMT) managed to move faster in the country, acquiring a majority stake in Indian e-commerce pioneer Flipkart for $16 billion in 2018. Since then, India has clamped down on foreign investment, leaving Amazon in a difficult position.

Future Coupons was a way in. The country prohibits foreign direct investment in inventory-based business models to protect smaller players. “Unlike Amazon, Reliance has no restrictions; it’s not a level playing field for [foreign] investors,” says Shweta Dubey, a partner at Indian law firm SD Partners, which focuses on antitrust cases. Dubey compares Future Retail to an Indian version of


By investing in Future Coupons, Amazon would have indirectly received about half of the company’s 10% stake in Future Retail. Amazon intended to buy all of Future’s retail assets within a decade, according to court documents that emerged in the dispute with Reliance.

By then, Amazon hoped India’s rules on foreign direct investment would have been relaxed. Reliance’s bid for Future Retail put a damper on those plans. In 2020, Amazon asked an arbitrator to stop the deal. The arbitration panel ruled in favor of Amazon.

But at the end of last year, India’s Competition Commission rendered that decision essentially moot in find that Amazon had concealed its intention to acquire Future’s retail assets. The regulator suspended its approval for Amazon’s investment in future 2019 coupons and imposed a $27 million penalty on the company for “failure to state the purpose of the combination.”

Amazon appealed CCI’s decision.

Reliance’s local and political advantages give Amazon a slim chance of overturning the competition ruling, according to Dubey, India’s antitrust lawyer.

Meanwhile, in the United States, Amazon is dealing with its own regulatory issues. Senator Amy Klobuchar recent invoice aimed at preventing digital platforms from favoring their own products is largely aimed at Amazon.

According to DA Davidson’s Forte, “For Amazon, we expect a 10-year distraction period for antitrust issues.” These distractions can now extend overseas as well.

Write to Karishma Vanjani at


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