AMZN Amazon.com Inc

By Newley Purnell 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (January 16, 2020).

NEW DELHI -- Amazon.com Inc. Chief Executive Jeff Bezos pledged to invest an additional $1 billion in the company's Indian operations, part of a charm offensive in a promising but challenging market.

Mr. Bezos told a gathering of local Amazon sellers that the intent is to help more small businesses start selling on the company's marketplace. The new funds will supplement the $5 billion that Amazon has said it is spending to build out its Indian business, a spokeswoman said.

"We're making this announcement now because it's working," Mr. Bezos said Wednesday, referring to Amazon's efforts to get India's legions of mom-and-pop shops connected to its platform. "And when something works, you should double down on it."

The Indian business environment has become increasingly challenging for Amazon since its launch in the country in 2013. Hoping to match China's success at building tech titans, Indian policy makers have been tightening restrictions on the American companies that are making deep inroads in the country's internet economy.

On Monday, India's antitrust watchdog ordered an investigation into whether Amazon and Walmart Inc.'s Flipkart have violated competition laws. Between them, the two platforms account for more than 80% of online sales in India, according to Morgan Stanley. Amazon and Flipkart say they are compliant with local laws.

After Walmart sealed its $16 billion acquisition of Flipkart in 2018, India altered its rules for how foreign-owned retailers can sell goods online, forcing Amazon and Walmart to rewire their supply chains. The rules don't apply to local rivals.

Regulators have also talked about the need for stricter rules for storing user data in India and new regulations governing social media.

Meanwhile, the Confederation of All India Traders, a body that says it represents millions of online and offline domestic sellers, has been criticizing Amazon for what it calls unfair practices.

The group said it was holding protests across the country in light of Mr. Bezos' visit. Praveen Khandelwal, the confederation's general secretary, said in a statement that additional Amazon investment would only hurt retail trade in India.

Amazon says India's online shopping sector has benefited from the company's effort to engage small merchants and shops.

On Wednesday, Mr. Bezos praised U.S.-India ties and said he believes the 21st century "is going to be the Indian century." At the end of his talk, the executive, dressed in an indigo Nehru jacket, clasped his hands together and bowed before the crowd to great applause.

After touching down in New Delhi on Tuesday, Mr. Bezos posted a video on his Twitter account showing him paying tribute at a memorial to Indian independence leader Mahatma Gandhi.

Rajesh Roy contributed to this article.

Write to Newley Purnell at newley.purnell@wsj.com

(END) Dow Jones Newswires

January 16, 2020 02:47 ET (07:47 GMT)

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