Amazon Inc Chief Executive Jeff Bezos said on Tuesday the company would invest an additional $3 billion in India.
Chief Executive Jeff Bezos announced the plan at a meeting of business leaders Tuesday with the Indian Prime Minister Narendra Modi in Washington.
Jeff Bezos, founder and CEO of Amazon.com, said,
“We have already created some 45,000 jobs in India and continue to see huge potential in the Indian economy. Our Amazon.in team is surpassing even our most ambitious planned milestone, and I’m pleased to announce today that we’ll invest an additional $3 Billion on top of the $2 Billion that we announced in 2014, bringing our total investment in India to over $5 Billion.”
In July 2014, Bezos announced the company will pump in $2 billion into India over time. That announcement was seen as an open challenge to local rival Flipkart, India’s largest e-commerce firm, which had announced just one day earlier that it raised $1 billion from Tiger Global, Naspers and other investors.
Bezos said Amazon had so far built 21 fulfillment centers with more than 5 mln cubic feet of storage space. He said its link-up with India Post enabled it to reach all serviceable postal codes in the country.
He said the Hyderabad center would create jobs and career development opportunities for thousands of people and a “significant” number of jobs would be created over time because of the deployment of Amazon Cloud Services.
USIBC chairman John Chambers announced that in less than two years, about 20 per cent of USIBC member companies have already invested $28 billion India.
“Over the next 2-3 years, we see this pace accelerating, again with about 20 per cent of our member companies reporting, indicating that USIBC members are on track to invest an additional $45 billion, which is a conservative estimate,” he said.
“Given Prime Minister Modi’s track record towards implementing ‘Digital India’ and key economic reforms, we are optimistic that this number will be dramatically exceeded, perhaps even doubled,” Chambers added.
“Today we are witnessing a new phase in India’s growth story driven by the vision of Prime Minister Modi,” he said.
Within just three years of its launch, Amazon’s India arm—Amazon.in—has become a top player in the Indian e-commerce space, fighting neck-to-neck with the homegrown Flipkart, which began operations in 2008.
Amazon faces competition in India from local startups Flipkart Internet Pvt., which was valued at $15 billion as of last June, and Snapdeal.com, with a valuation of about a third of that.
On the other hand Flipkart is reportedly struggling to raise funds at its preferred valuation. The company has spoken to at least 15 investors, who have all refused to invest at its asking valuation of $15 billion