Amazon (NASDAQ:AMZN) stock fell 1.16% on Tuesday—one of its worst days so far in 2020. However, the stock opened higher Wednesday and held on to a 0.26% gain at 10:04 AM EST. Yesterday, Amazon stock’s gains came on the back of CEO Jeff Bezos announcing a new investment plan for India. At a company event in New Delhi, Bezos said that Amazon will inject an additional $1.0 billion into its Indian operations, as reported by CNN Business.
Amazon on track to pump over $6.0 billion in its India operation
Although Amazon entered India in 2004, it opened its online shopping platform there in June 2013. In one year, Amazon’s India online marketplace gained thousands of sellers and served millions of consumers.
Amazon announced that it would invest $2.0 billion more to expand its India business in July 2014. In June 2016, the company added $3.0 billion to its India investment budget. The addition brought the company’s total investment commitment for India to over $5.0 billion. The latest investment commitment means that Amazon is on course to spend over $6.0 billion on its India business.
Amazon stock has gained 556% since the day the company’s online marketplace first opened in India.
The company’s latest India investment pledge of $1.0 billion will specifically go toward supporting the country’s startups. Amazon aims to bring more Indian small businesses online to expand their market opportunity.
With the investment, Amazon hopes to bring 10 million Indian small businesses online to tap into the global market. The additions would increase India’s export sales by about $10 billion by 2025, according to a Reuters report.
Stiff headwinds despite a big investment
Despite the huge investment in India, Amazon continues to face headwinds in the country. Recently, India launched an antitrust investigation into the company amid outcry from small merchants. Flipkart, Amazon’s top Indian rival, also faces an antitrust probe. In addition to the antitrust probe, India forced Amazon to overhaul its supplies sourcing practice last year.
Indian merchants protested Bezos’s arrival in India to announce the latest investment plan.
Amazon stock trailing FAANG peers in 2020
Amazon’s new India investment pledge comes as the stock struggles in the new year. The stock has gained less than 2.0% YTD (year-to-date), which makes it the worst-performing FAANG stock so far in 2020. Currently, Google parent Alphabet (NASDAQ:GOOGL) leads the FAANG group with gains of more than 6.80% YTD. Facebook (NASDAQ:FB) and Apple stocks have risen more than 6.0% YTD. Netflix (NFLX), the worst-performing FAANG stock last year, has risen about 5.0% YTD.