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Explainer | Why Indian tycoon Mukesh Ambani is feuding with Amazon
- While Amazon, Future and Reliance await a verdict, the legal wrangling is threatening to unravel India’s biggest retail acquisition
- The stakes are high: the legal spat is essentially for the dominance of India’s estimated US$1 trillion consumer retail market
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A legal spat between Amazon.com and its Indian partner that started before an arbitrator in Singapore just became even more ferocious in a court in New Delhi.
The US e-commerce giant and Future Group, whose assets billionaire Mukesh Ambani’s Reliance Industries recently agreed to buy for US$3.4 billion, are locked in a dispute over that deal. Amazon says Future violated a contract with the sale to its rival and wants to halt it, while the indebted Mumbai-based firm says it would collapse if the transaction were to fail.
The Jeff Bezos-led e-tailer has accused Future and its founder Kishore Biyani of flouting disclosure rules, according to court filings. Future’s disclosures were “made as per the applicable requirements”, the company said in an email, refuting the allegations. Amazon has also written to the Competition Commission of India asking it not to approve the takeover until arbitration proceedings are complete.
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While Amazon, Future and Reliance await a verdict, the legal wrangling is threatening to unravel India’s biggest retail acquisition. But why is the world’s largest e-commerce company seeking to derail a deal that’s essentially bailing out a beleaguered retailer, whose market valuation is barely 2 per cent of its own?
Here’s what we know so far:
What led to the feud?
Amazon, in early October, accused its partner Future Group of breaching terms of a mutual agreement by announcing an asset sale deal with Reliance, the conglomerate helmed by Asia’s richest man.
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