Bezos Must Be Welcomed With Open Arms

The BJP’s political apprehensions are baseless. Amazon’s $1-billion investment can greatly boost India’s digital economy

- Subir Roy

Normally, a promise to invest $1 billion in India would have been greeted with minor rejoicing in New Delhi. But not in the case of JeffBezos, the owner of e-commerce giant Amazon and the richest man in the world.

Two well-placed individuals in the ruling establishment were less than enthusiastic in their response to the announcement, and in line with this, Bezos failed to get an audience with Prime Minister Narendra Modi.

The somewhat high profile Cabinet Minister Piyush Goyal said in so many words that this investment announcement was no big deal, as the money was coming into the foot the losses Amazon was making.

He thereafter seems to have had second thoughts and said that the cash inflow was all right so long as it was in accordance with the rules.

Goyal, who held charge of the Union Finance Ministry when Arun Jaitley was ill, seemed to overlook some of the basic realities of business. Investment in a new venture covers not only the cost of acquiring assets but also meeting the cash losses that it makes until it breaks even on a cash basis. The importance of one is no less than the other. If investment in logistical hubs or plants and machinery leaves nothing to meet the cash deficit the business initially makes, then the business cannot survive.

Media-centric view

Goyal’s comment was followed by a party functionary, Vijay Chauthaiwale, who is in charge of the BJP’s foreign affairs department, asking Bezos to take care of his employees back home before he could expect his charm offensive to work. Clearly resented was the critical stand taken by the prominent and respected US newspaper The Washington Post on some of the recent policy initiatives of the Modi administration.