Amazon (NASDAQ:AMZN) has joined the growing ranks of retailers investing in Indian technology companies. The online retailer is scouting for start-ups and has entered into a joint venture with Catamaran Ventures as it ramps up operations there.
The Seattle-based company is quietly looking for technology and internet start-ups in India to help grow operations there, sources close to the matter told the Times of India.
Separately, Amazon has formed a partnership with Catamaran, a private investment firm controlled by the co-founder of Indian IT services company Infosys.
"Catamaran is partnering with Amazon Asia to offer services that help offline sellers and SMBs in India to get online and to take advantage of the fast-growing online customer base in the country," Arjun Ramegowda Narayanswamy, who heads Catamaran Ventures, told the Economic Times.
Amazon debuted an online marketplace in India last year. Amazon Seller Services facilitates sales by third party providers of goods including Amazon staples such as books and toys. But India does not allow foreign retailers to directly deal with consumers, a law that has prohibited Amazon and others, including Walmart, from selling direct to shoppers.
It's likely that Amazon's future investments and interests predominantly lie with developing supply chain and delivery solutions. In India, where the infrastructure is largely undeveloped — unlike in the United States — moving product is a serious challenge.
It's also an area where Amazon excels. But like Walmart before it, Amazon has been stymied by the local marketplace, legal and political red-tape and transportation system that, simply put, defy the efficient movement of goods.
Amazon is not alone in both attempting to launch retail operations in India and investing in technology talent there. Walmart (NYSE:WMT) has begun serving the B2B market there, selling goods through its cash-and-carry store and online marketplace. Both Walmart and Target (NYSE:TGT) have invested in technology labs in the country.
Like China before it, India represents a large and open market for global retailers and a good source for technological innovation and talent. According to Forrester, India's e-commerce market is expected to reach $8.8 billion in 2016.
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