When Donald Trump told us, as he did a lot, that he was the greatest President in the history of the United States and a Genius into the bargain, we listened (to put it mildly) with some scepticism: quite a lot of scepticism actually. Who knows, however unlikely it seemed, he might have been right, but a palpable lack of any grip on reality made it all seem so much bluster and nonsense: not worth listening to. When Jeff Bezos tells us, on the other hand, that this is going to be India’s Century, it’s worth sitting up and paying attention …because, unlike Donald Trump, Jeff Bezos knows what he’s talking about. He knows that right here, right now tectonic economic change is taking place in India, and it’s nothing short of a revolution.
Under his leadership, Amazon had identified the subcontinent as a global powerhouse as long ago as 2013, and since then the company has invested $6.5 Billion in India (dramatically putting it’s money where Mr Bezos’ mouth is): because, like most informed commentators, Mr Bezos can see the roots of tectonic change unfolding, and he couldn’t be more enthusiastic about it’s raw potential: “I predict that the 21st century is going to be the Indian Century. The dynamism, the energy… everywhere I go here, I meet people who are working in self-improvement and growth. This country has something special”.
So what exactly has he seen, and what does it all mean?
Indian Retail Markets are Moving Online
Well, for a start, India has a $1.2 Trillion Retail Market, only 7% of which is currently online: driven by the ferocious consumer appetite of what will shortly be the most populous country on the planet: increasingly middle class, increasingly urbanised and more tech aware than ever. And now, on top of all that, the Fourth Industrial Revolution (www.weforum.org) has re-energised levels of online invention on the subcontinent, lifting it to third place in World rankings for capacity to attract investment in technology and opening up unprecedented potential for the future. All of which means that 7% figure is set to soar, and Amazon is eager to snap up its share of the remaining 93%, which accounts for its $6.5 Billion investment so far. From a base of $18 Billion in 2018, online commerce in India is now expected to grow to $200 Billion by 2028. So if ever there was a coiled spring…this is it.
Amazon, though, is facing some pretty stiff competition
Walmart bought Flipkart for $16 Billion in 2018 and Reliance owned JioMart is projected by Goldman Sachs to secure a 50% share of India’s lucrative online grocery market by 2024 (www.goldmansachs.com). Competitive, exponential growth is on the cards.
But it’s not just about retail …
Amazon is also investing in Indian Education (through the Amazon Academy (www.academy.amazon.in)), Digital Payment Systems, Video and Music Streaming as well as new infrastructure for delivery of food (watch out JioMart); and (Lord knows we need it) Medicines, with a new Amazon Pharmacy platform.
Sitting at the Heart of the World
India sits at the Heart of the World’s Supply Systems and Distributive Technologies, and Jeff Bezos knows that too. Last year he announced Amazon would invest a further $1 billion to support ten million traders and micro, small, and medium enterprises on the subcontinent, driving forward an expected $10 Billion in additional exports within the next four years: not to mention a further 1 Million jobs, which will inevitably further enhance that seismic demographic change still further and faster. Success, after all, tends to breed success…
So unlike Donald Trump, who now (so soon) already seems a distant memory, Jeff Bezos knows what he’s doing…this will be India’s Century.
Red Ribbon Asset Management (www.redribbon.co) has more than a decade’s experience of successfully investing in the subcontinent’s markets: delivering above market rate returns for investors whilst at the same time staying loyal and committed to its core values of Planet, People and Profit.
Executive Overview
We’re currently experiencing a radical restructuring of the world’s supply infrastructure. Those changes are set to put India at the very heart of a global revolution that will change the way we all do business.
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Red Ribbon is committed to identifying and building on investment opportunities that are fully in compliance with its core Planet, People, Profit policy: not only offering above market rate returns for investors but also protecting our Natural Capital.
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