The battle to dominate the online retail marketplace in India has heated up with the US retail major Walmart in the process of picking up a stake in Flipkart, which will bring it face to face with rival Amazon.
The proposed Walmart-Flipkart partnership plans to make an aggressive play in the food sector with a substantial chunk of the US retailer’s investment in the Indian market being earmarked to build back-end food and grocery infrastructure aimed at India’s online and offline food sectors, reports the Economic Times.
A significant portion of Walmart’s proposed investment in Flipkart will be used to build infrastructure including food parks, cold chains, collection centers, sorting and grading facilities, centers for food excellence and allied facilities, the daily added.
Amazon has already gained the Indian government’s approval to sell locally produced and packaged food items through online and offline channels. It has started sales in Pune on a pilot basis.
Walmart plans to pick up close to 20% of Flipkart and become its largest stakeholder.
However, the Bentonville-based retailer could face various legal hurdles before it can hope to pick up a stake in Flipkart, as the Indian government might seek clarity on whether it will use the deal to open offline stores.