Tuesday 8 November 2016

Alibaba moves closer inside India with Paytm’s help

Alibaba seems to be taking slow and steady steps into the Indian ecommerce industry. The recent turn of events that have transpired between the Chinese company and Paytm (where the former holds a stake) have led us to believe that.
Around fifteen employees from Alibaba China are said to be visiting Paytm’s Noida branch to observe the working of Indian ecommerce. Now Paytm has said that there is no specific agenda to this; and employees of both companies frequently visit each other’s office. However, we have reason to believe that there is more to this.

Getting ready to take India by storm

Alibaba has long expressed its interest in establishing a footprint in India. Towards this end, the company has taken the following steps in the past:
  • After acquiring a share in Paytm in early 2015, Alibaba put in $ 680 million in the Indian company
  • Alibaba reportedly set up a team for its India operations a few months back
  • One97, Paytm’s mother ship, officially registered the latter as a separate business entity recently. Experts speculated that this could be to aid Alibaba to make a formal entry in India.
  • Guru Gowrappan, Alibaba’s global MD recently joined Paytm’s board of directors
  • The Chinese company worked towards creating a logistics arm in India
  • Speculations were on that Alibaba was keen on increasing the 40% stake in Paytm

Alipay and Paytm

Alibaba’s payments company Alipay recently announced that it would share its technological expertise with Paytm to help the latter build a payment platform.
The fact remains that Alibaba will soon be reason for Flipkart and Amazon to lose more sleep. Amazon was unable to capture the Chinese market thanks to home grown Alibaba’s clout. The company is facing a similar battle in India versus the blue-eyed marketplace Flipkart. In Indian ecommerce two is a crowd, three (Snapdeal is also in the game) is chaos and four will surely be all out mayhem.

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