Amazon grace, how sweet your sound

Amazon's $35 bn investment commitment in India, announced on Wednesday, reflects the country's market opportunity. India is Amazon's fastest-growing major market globally because of its untapped potential and consumer acceptance of new digital retail formats such as quick commerce. Producers are shaping their marketing strategy around Q-commerce, which bypasses several hurdles in distribution through improved analytics. The size of India's consumer market allows new business plans to be tested at sufficiently large volumes to iron out initial glitches. By the time a technology-driven service establishes itself in the country, such as digital wallets, it becomes ready for export to other markets.

This leads up to claims for sovereign control and local resilience over technologies that are being developed in the country by global companies. Microsoft, which announced a $17.5 bn commitment by 2030 to develop AI and cloud services in India, shows that such claims are legitimate. The combination of resources, policies and market conditions helps create an Indian stack that encourages localised innovation. In this case, too, investment pledges are readily executed due to the unique mix of attributes available in India. This addresses the issue of enforceability of investment commitments other economies may have to tackle.

Technology investment in India has been receiving special policy attention. It has translated into an enviable Indian stack of DPI on which a wide spectrum of virtual commerce is hosted. India's policy environment has evolved along with technological advances to drive dispersal. This helps bring down costs for emerging technologies and makes the country a go-to destination for Silicon Valley. As global competition intensifies, firms increasingly view India as a strategic base for long-term growth. US immigration restrictions could widen the investment funnel. The Chinese market is relatively less accessible for US technology giants. India is a safer bet in many respects.