Global retail giant Amazon on Thursday said allowing foreign direct investment in eCommerce will help in accelerating further growth in the $3 billion Indian online retail market.
"We are already very successful but FDI would make possible to spin it more aggressively," Amazon Vice-President and Managing Director India Amit Agarwal told reporters on the sidelines of the Economist India Summit.
Amazon, which operates on a marketplace model in India, is betting big on the country and has announced investment of $2 billion to expand its operations.
Foreign Direct Investment (FDI) norms in India do not allow FDI in e-commerce. Most e-tailers like Flipkart and Snapdeal follow the online marketplace model, where they connect sellers and buyers.
Amazon, which launched its marketplace in India last year, counts India among its fastest growing markets and has said it is on track to touch $1 billion in gross sales.
In India, Amazon sells over 17 million products across categories like books, apparel and electronics from a growing base of thousands of small and medium-sized businesses.
It also plans to open 5 new centres across India in addition to its two fulfilment centres (FCs) in Mumbai and Bangalore.
Apart from foreign players like Amazon, industry bodies like Internet and Mobile Association of India (IAMAI) are also supporting the move saying it will help e-commerce firms grow Internet usage in the country and provide players access to funds for investing in technology and back-end operations.
According to IAMAI, only 25 million of over 231 million Internet users in India transacted online (as of December 2013), taking the Indian e-Commerce market to Rs 62,697 crore (Rs 626.97 billion).
Photographs: Michaela Rehle/Reuters
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