Amazon expects groceries and household products to account for more than half of its Indian business in five years, according to Reuters. Amit Agarwal, Amazon’s SVP and Country Manager India, said such products make up the retailer’s largest category in the country by units sold.
Amazon already is experimenting with some fresh groceries in India and is selling other packaged goods through its Amazon Pantry service. The retailer has partnered with local vendors in four cities to provide two-hour delivery.
India is home to the second-largest active Amazon user base after the U.S., with more than 100 million registered users, and the Amazon.in app was the most downloaded shopping app in the country in 2017, according to App Annie. Additionally, Amazon Prime added more members in India during its first year than in any other geography in the retailer’s history.
However, the rapid expansion is not without its downside: Amazon has yet to achieve financial stability in India, according to Agarwal. The company is still developing logistics and infrastructure needed to address long-term opportunities and has committed $5 billion to its growth in the country.
Amazon will be competing with Walmart, which is reportedly in advanced talks to become the largest shareholder in Indian e-Commerce retailer Flipkart. The retail giant could acquire an initial 20% to 26% stake and eventually grow its share to 51%.