Amazon wants its land back as it sets up distribution logistics for India operations
Earlier this month, Amazon found a way to start their ecommerce operations in India despite the Foreign Direct Investment restrictions. Hosted at Junglee.com, Amazon India currently aggregates prices and deals from across Indian ecommerce websites and Amazon.com. The user gets to search for products they want and Junglee.com lists the prices from several websites; users can select a deal and they are redirected to the respective site for buying the product. This is of course a stop-gap solution. The Indian legal framework has restrictions on Foreign Direct Investment (FDI) that have so far prevented Amazon from starting operations similar to that in the US. However, in an update from the government, Amazon Asia-Pacific has been cleared and the subsidiary is now setting up logistics for distribution in India. The description for Amazon's operations:
To set up a WoS [Wholly Owned Subsidiary] to undertake the business of online market place operator and retailer inter-alia courier services.
While Amazon was getting in the process of getting the back-end setup, launching Junglee.com was an interesting move. In a way it is a message that Amazon is getting suppliers and retailers on board; Amazon's press release lists 10 partners other than Amazon.com itself:
- The Bombay Store
- Fabindia
- Bata India Limited
- Reebok
- Dabur
- Homeshop 18
- Gitanjali
- Hidesign
- UniverCell
Amazon's expansion plans have led them to ask the Andhra Pradesh government for help in getting their allotted land back. According to a report in the Hindu's Business Line, farmers in Andhra Pradesh have encroached upon Amazon's land and the company wants it back. A team from Amazon met with AP Chief Minister last week asking him to intervene and help Amazon get the encroached land back.