Can the Chinese ecommerce giant Alibaba take on the US titan Amazon in the Indian market? The much anticipated clash between the two in Asia’s fastest growing ecommerce market is becoming a possibility.
The entrepreneur turned former English teacher, Jack Ma, has keenly participated in PM Modi’s Shanghai business meeting last week. “We are excited about India; we are excited about Make in India and Digital India”, Jack Ma has told Modi; expressing his keen interest in entering the Indian market.
There is no question that Alibaba’s Indian entry should occur now than later. The Indian market is too big and full of potential for the Chinese giant to avoid. But at the same time, events in the last few months indicate that the market is consolidating quickly.
Amazon’s great Indian summer sale was a flash launch of the company into even remote corners of the country. This means that, the later the China firm’s entry, the costly and difficult will be for it to get into India.
Alibaba itself has made couple of arrangements to realize its India dream. A stake holding participation in domestic major Snapdeal is still alive. Besides, it has considerable stake holding in payment portal paytm. Recently, paytm has made its decision to enter into ecommerce field.
Now the dilemma for Alibaba, while making its India entry decision is not purely business related. Rather the existence of trust deficit at the bilateral level between India and China has its own share. The exit of ethnic Chinese owned firm Hutchison from the strategic telecom sector is rightly in front of it. Narendra Modi’s visit to China brightens the India ambitions of Chinese companies like Xiaomi and Alibaba.
In all probability, Alibaba’s ‘yes or no’ to India will arrive soon. If it makes into India, other than through the snapdeal route, the Indian ecommerce sector may look congested. Another wave of strong competition may emerge and here, the Indian firms should be more innovative to stand up to the ‘multitasking’ foreign ecommerce giants.
