Minister Piyush Goyal Questions Amazon’s Investment Claims in India

NEW DELHI: Minister of Commerce and Industry Piyush Goyal has openly criticized the business practices of Amazon, particularly focusing on its approach to pricing in India. Speaking at an event that highlighted the impact of e-commerce, Goyal expressed his concerns that the recent announcement of a $1 billion investment by Amazon is misleading and does not signify positive development for the Indian economy.

Goyal emphasized that the investment should not be seen as a cause for celebration, pointing out that it merely compensates for substantial losses the company has incurred. He stated, “When Amazon says they are going to invest a billion dollars in India, we forget the underlying story that the billion dollar is not coming in for any great service or any great investment to support the Indian economy.”

The Minister elaborated that Amazon’s reported losses of ₹6,000 crore in one year suggest a practice of predatory pricing. Data from Amazon Seller Services indicates a significant increase in net losses, which raises further questions regarding the company’s pricing strategies in the Indian market.

Despite Amazon’s commitment to invest an additional $15 billion by 2030, bringing its total investment to $26 billion, Goyal remains skeptical. He pointed out that a sizable portion of Amazon’s spending appears to be directed towards legal expenses, which raises suspicions about the necessity and intent behind such expenditures.

Goyal also expressed concern over the potential impact of e-commerce on traditional retail sectors and employment opportunities in India. He cited the risk of social disruption caused by online retailers, which could threaten the survival of millions of small retailers and local businesses.

During his remarks, Goyal dismissed the findings of a report that claimed e-commerce growth does not pose significant risks to employment. He characterized such conclusions as misleading and emphasized the need for a more thorough investigation into the actual effects of e-commerce on the economy.

Furthermore, Goyal referenced international examples and pointed out other sectors adversely affected by e-commerce, including cloud kitchens and online medical sales. By comparing India to places like Switzerland, he suggested that care must be taken to protect local businesses from the aggressive expansion of online platforms.