April 22, 2020
The companies confirmed that they were planning to bring together JioMart and WhatsApp to seamlessly connect people with local businesses
The deal is expected to positively impact millions of small and medium businesses, farmers, small merchants in the informal sector
WhatsApp and Jio will remain independent entities and compete where necessary but will collaborate in other areas where they see synergies
India has been aiming for the largest FDI share in the world over the past few years, having grossed US$64 billion during 2019
In the largest FDI deal in the Indian technology and telecom sector, Facebook has invested US$5.7 billion for a 9.99 per cent stake in Jio Platforms, a unit of Reliance Industries. For Reliance, the deal is expected to help reduce debt, whereas, for Facebook, it will strengthen its India presence, especially on WhatsApp.
As per Facebook, one of the focus areas of the collaboration will be “creating new ways for people and businesses to operate more effectively in the growing digital economy.” Both companies confirmed that they were planning to bring together JioMart and WhatsApp to seamlessly connect people with local businesses.
The companies also added that they will collaborate on other major projects to create opportunities in Indian commerce, but are yet to make concrete announcements. The deal is expected to positively impact millions of small and medium businesses, farmers, small merchants in the informal sector.
However, as per an Economic Times report quoting Jio Strategy Head Anshuman Thakur, WhatsApp and Jio will remain independent entities with their business models and compete where necessary, in line with the respective business models, and collaborate in other areas where they see synergies.
Reliance Jio Infocomm has about 388 million users (half the total mobile Internet users in the country). Facebook and its subsidiary WhatsApp also see India as their largest market globally with 328 million and 400 million users, respectively.
India has been aiming for the largest FDI share in the world over the past few years. FDI has seen a jump over the last few years and grossed US$64 billion in FY19. The telecom sector attracted FDI worth US$2.7 billion while electronics, computer software, and hardware saw FDI of US$ 6.4 billion.
Since the launch of the Make in India programme in 2014, foreign investment inflow into the nation has been recorded at US$335.33 billion till the end-2019, representing nearly 51 per cent of the cumulative FDI inflow since 2000.