Alibaba to enter Indian e-commerce space

Alibaba, the Chinese e-commerce giant is contemplating entering the Indian e-commerce space, later this year. The group president Michael Evans and global managing director K Guru Gowrappan have already approached Tata Sons to discuss a possible partnership, a deal which could shake up the rapidly increasing online retail market in India.

The discussion with Tata Group’s chairman Cyrus Mistry would have also covered other areas such as omni-channel, offline stores and logistics for supporting the core e-commerce business of Alibaba Group.

“Several entities have appreciated our model and have expressed interest in it at different points of time. We do not wish to comment any further,” a Tata Sons spokesperson said.

While the Indian e-commerce sector does not allow for FDI, there is currently no restriction on foreign funds in online marketplaces that connect sellers with buyers, a model that is adopted by Snapdeal, Flipkart and Amazon.

As of now, the Indian Internet market size stands at $16 billion, but by 2020, Morgan Stanley expects India to emerge as the world’s fastest-growing e-commerce market with Internet market size of $159 billion. While all of India’s e-commerce companies sold goods worth $16 billion in 2015, Alibaba sold goods worth $377 billion, a Morgan Stanley report states.