Asia’s richest man takes on Amazon
A conglomerate run by Asia’s richest man has started a service that aims to compete with Amazon in India. Mukesh Ambani’s Reliance Industries said it had been inviting people to sign up to its grocery delivery service.
The company is aiming to use its massive mobile phone customer base as a springboard for the business.
The new e-commerce venture could become a major challenger to India’s existing online retail giants. Two subsidiaries of Mr Ambani’s business empire, Reliance Retail and Reliance Jio, said they had soft-launched the venture, called JioMart.
JioMart says it offers “free and express delivery” for a list of grocery goods, which currently numbers some 50,000 items.
Unlike its rivals, JioMart will connect local stores to customers via an app rather than providing and delivering the goods itself.
India’s online grocery market is in its infancy – currently estimated to be worth around $870m a year, with just 0.15% of the population using such services.
However, analysts predict the sector could see annual sales of around $14.5bn by 2023.
India’s e-commerce market is currently dominated by Amazon and Flipkart, which is owned by Walmart. Both companies suffered a setback last year when the Indian government introduced new laws that restrict foreign-owned online retailers from selling goods from their own subsidiaries.
This helped give Indian companies, which are not affected by the new rules, an edge over their foreign rivals.
Mr Ambani, who is the chairman of Reliance Industries, has an estimated fortune of more than $60bn (£45bn).
The group’s core business is oil refining but it also has major investments in other sectors including retail and telecoms.
Reliance Retail owns grocery stores in India, runs outlets for global brands, including Hugo Boss and Burberry, and in 2019 bought the British toy shop Hamleys.
Reliance Jio is India’s second-largest telecom operator, with more than 360 million subscribers.