Shopee had entered the Indian market in October last year
Shopee’s entry to India was in line with the company’s global expansion plans
It competed against the likes of Amazon, Flipkart, Meesho, Udaan, Snapdeal, among others
In a sudden move, Singapore’s major ecommerce player Shopee has decided to shut down its India operations. Shopee has said that due to market uncertainty, it has decided to shut its Indian operations.
The development comes almost five months after it had launched its operations in the country, further raising the competition in the already crowded ecommerce market in India. The fresh move also comes a month after India banned Free Fire, a game operated by Shopee’s parent Sea Ltd.
Shopee was launched in India in October of last year, in a bid to expand its business operations across the world including Europe.
It is still unclear what was the main reason behind Shopee’s roll back, or whether the Indian government had any role in the ecommerce giant’s exit.
Shopee sells products across categories, which includes fashion, electronic appliances, cosmetics, automobile accessories, along with grocery and sports related items. The ecommerce platform has its operations in Indonesia, Taiwan, Thailand, Malaysia, Vietnam, Philippines, Brazil, Colombo, Spain, France apart from Singapore.
This is one of the major exits by a foreign internet-based company, at a time when more western companies are betting on the Indian market.
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While the domestic ecommerce policy and working can work in the background for the platform to make an exit in India, several associations including traders’ body CAIT has welcomed the move.
CAIT has welcomed the decision of Shopee to exit from India and said that any company which will violate the sovereign law of the country and breach data collected from India shall meet the same fate.
“There are a number of other foreign funded companies who are habitually playing with Indian laws and involved in mal-practices. Either they should mend their ways or else must pack their bags to exit from India,” said Praveen Khandelwal, secretary of CAIT.
In September last year, CAIT had launched a move against Shopee and later followed it up with the Ministry of Finance and Ministry of Commerce.
Shopee counts US heavy giant Amazon, and Walmart-backed Flipkart as its two prime competitors. Apart from them, Shopee too faced market heat from the likes of Meesho, IPO-bound Snapdeal, B2B commerce giant Udaan, Dealshare, among others.
As per Inc42 Plus analysis, India’s ecommerce market is set to touch $400 Bn by 2030. The report claimed that while ecommerce startups have bagged $27 Bn in 2021, it is the rise of the Thrasio model and the emergence of content commerce that have paved the way for ecommerce growth in the country.
It goes without saying that the pandemic have further acted as tailwind for the ecommerce industry in India to grow.