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Amazon Dumps Karnataka, Turns to Telangana

Software services hub Bengaluru’s loss seems to be Hyderabad’s gain with Washington-based Amazon Inc on Wednesday formally firming up plans to set up its largest Fulfilment Centre (FC) in India near Kottur, Telangana.

Published: 09th April 2015 06:06 AM  |   Last Updated: 09th April 2015 09:09 AM   |  A+A-

HYDERABAD: Software services hub Bengaluru’s loss seems to be Hyderabad’s gain with Washington-based Amazon Inc on Wednesday formally firming up plans to set up its largest Fulfilment Centre (FC) in India near Kottur, Telangana.

This will be the 11 FC for the $89-billion online retailer and will have storage capacity of over 2.5 million cubic feet covering one million sq.ft.

Amazon Seller Services Private Ltd  on Wednesday signed a pact with the Telangana government in this regard. “The state has given all clearances in 11 days, well within the guaranteed time. We are making all efforts to make Telangana an investor-friendly state,” said K Chandrashekar Rao, Chief Minister of Telangana.

The proposed facility will be operational by May and will enable the company to ensure faster and quicker delivery of products and help counter competition from homegrown e-commerce rivals such as Flipkart and Snapdeal.

According to Amazon, the FC in Telangana will allow it to reduce delivery time and cost of delivering products.

“This is the largest investment in infrastructure in any single state, to date, by Amazon in India. The FC will allow Amazon to offer its Fulfilment by Amazon service to thousands of small and medium businesses in the state and empower them to gain access to and service customers across the country at low operating costs,” Amazon said.

Future Investments in Karnataka on Hold

Amazon said its future investments in Karnataka have been put on hold until the taxation issues are resolved. Officials said, Amazon’s warehouse in Karnataka has been partially shut for sometime now due to issues raised by the state’s tax regulator. “We understand the situation to be a case where the laws have not kept pace with the new-age online business models,” an Amazon spokesperson said after signing a pact with the Government of Telangana here Wednesday.



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