Alibaba Intends To Finance India's Snapdeal

The Chinese giant would sponsor Indian organization, which would also raise funds from other sources as well.

The Chinese ecommerce giant, Alibaba Group Holding Ltd., has invested in an Indian online selling organization, known as Snapdeal, as reported by Alibaba news . The Indian company would also receive foreign money from a number of other enterprises, including SoftBank and Foxconn. It is most likely that the deal would soon be finalized and the contributions of the three different organizations would help it to earn $500,000,000.

Alibaba news today exclaimed that the recipient of the funds is battling with Amazon’s local subsidiary and Flipkart Online Services Ltd. The sponsoring organizations have not yet commented. If the online high-tech seller succeeds in receiving funds from the Asian organization, then the deal would represent the first direct investment of Hangzhou-based enterprise in China.

An affiliate of the Chinese company has appeased the Indian stakeholders, as it has agreed to purchase 25% of the Indian financial service provider, One97 Communications. The Indian electronic selling industry has also appeased Japan’s SoftBank, as it has not only agreed to invest $627,000,000 in Snapdeal but has also decided to invest $10,000,000,000 in the country’s online selling sector, reported Alibaba breaking news.

The founder of one of Foxconn (investing firm), Terry Gou, has stated almost two months ago that India is an important market for his organization. The country’s fast expanding online selling sector has been able to lure a number of other investors, such as GIC Private Ltd. piling in, Singapore’s Temasek Holdings and Qatar Investment Authority.

The Indian online trading industry has succeeded in luring $5,000,000,000 in 2014. Market professionals believe that the Alibaba’s financial contribution would not only contribute to the potential of the Indian company but also improve the relations between the organizations.

Morgan Stanley has claimed that while the huge Indian market has a fewer number of networking users, it still has the potential to increase its online sales to more than $100,000,000,000 in 2020 from $2,900,000,000 in 2013, making it the fastest expanding market in the international world. In March, the chief executive of Snapdeal, Kunal Bahl, claimed that his enterprise was not interested in receiving funds immediately due to the available funds for the next 2 years.

It is probable that Alibaba’s investment would be welcomed by the Indian nation, as the received funds would play a significant role in boosting the growth of their huge economy. The Chinese enterprise should now take steps to ensure that the disbursed funds are utilized appropriately to achieve their objectives.

Mr. Ma has always showed interest in international expansion. He continuously favored the idea of penetrating global boundaries, as in the case of executing operations in America. Although India has less internet users than China, this step will further enhance the opportunities for the company as well.