Shopee Pulls out from India Due to Suspected Link to China

BEIJING, March 28 (TMTPOST) — Sea’s e-commerce unit Shopee announced on Monday that it will shut down its operation in India due to uncertainties in the southern Asian market.

The company also suspended its operation in France on March 6 after five months of operation in the market.

Shopee started to accelerate its international expansion in the second half of 2021, entering new markets such as India, Mexico, Brazil, Argentina and Poland.

India’s e-commerce market is believed to have massive market potential. Statistics from GlobalData show that India’s e-commerce market is expected to grow at a compound annual growth rate of 18.2% to US$120.1 billion from 2021 to 2025. Amazon and Walmart’s Flipkart have been operating in the Indian market for several years but e-commerce only accounted 3% of their total retail volume.

Reuters reported that Shopee originally planned to invest US$1 billion in the Indian market. Shopee accumulated over one million downloads on Google Play in the Indian market, boasting a daily order volume of 100,000.

Media have speculated that Shopee’s abrupt exit from India was caused by India’s crackdown on Chinese companies. Although Shopee is essentially a Singaporean company, it is scrutinized by India for its link to China.

Shopee India told its vendors that it would suspend operation in India from 12:00 PM, March 29. Buyers will then no longer be able to make new purchases on Shopee. Vendors can provide refund for their customers or complete the transactions before May 30. Shopee India also promised that it will provide after-sales customer service for users who had made purchases on its platforms.

Shopee’s operation in India only lasted for six months. The company entered India in late August 2021. Shopee announced its entry into the Indian market in a promotional video released in early August 2021. The company also started to recruit vendors in India to its platform, promising that it would provide free shipping for the buyers and sellers and that zero commission will be charged.

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