Exclusive-Amazon bets $3 billion on India's fast-delivery boom, sources say

US e-commerce giant Amazon is planning to invest $3 billion in its India quick commerce business by 2030, according to two sources. This marks Amazon's largest investment yet in the sector, where rivals have dominated by offering deliveries within minutes. Quick commerce, or instant deliveries, has gained significant traction in India, reshaping the way urban consumers shop for items ranging from groceries to electronics.

The $19 billion sector is projected to more than double in size to $41 billion by 2030, according to Datum Intelligence. Amazon intends to invest $1 billion in quick commerce by the end of 2027 and another $2 billion by 2030. The planned investment has not been previously disclosed. Amazon declined to comment on the investment figures.

Currently, Amazon's quick commerce business has generated $1 billion in annualized gross sales over the past three months, making it the fastest-growing e-commerce business in Amazon India's history. The bulk of the investment will go towards establishing new small neighborhood warehouses to expand the current Amazon Now service network, which enables quick deliveries. Both sources, who preferred to remain anonymous as the plan is confidential, highlighted the need for financial resources to fuel this expansion.

India's e-commerce sector has witnessed substantial growth since 2022, coinciding with heightened concerns over rider safety as delivery personnel zip through residential areas. In January 2024, India's government issued a directive requiring companies to halt the promotion of 10-minute delivery services. Domestic players such as Blinkit, Swiggy, and Zepto control 77% of the market, operating more than 4,500 stores, while Walmart's Flipkart leads with a 11% market share. Amazon, however, holds a mere 6.2% market share.

To bolster its presence, Amazon aims to open around 1,300 stores by April 2025, up from the current 750. Additionally, the company plans to enhance inventory management software, deploy AI tools for demand prediction, and expand its product selection. Amazon will focus on daily essentials, avoiding stocking items like iPhones, which are not likely to be reordered frequently.