On the eve of the Hindu festival of Holi this year, 10 men gathered outside a jewelry shop in the north Indian city of Kanpur carrying effigies. The cardboard statues, created to burn as part of a tradition of the festival, were five feet tall with pink heads and twirled mustaches on their faces. On the torsos, the men stapled an image of Jeff Bezos, founder and CEO of Amazon.
The men were part of a live demonstration organized by Praveen Khandelwal, a Delhi-based businessman who leads a network of roughly 80 million small business owners called the Confederation of All India Traders, or CAIT. While the men in Kanpur prepared their effigies of Bezos, hundreds of other traders around the country displayed their own in a Zoom call (the demonstration was meant to be held in-person, but India was on the verge of a deadly second wave of Covid-19 cases, and cities across the country were already in lockdown). Some of the businessmen video-called from inside their own stores, others were perched on their balconies and terraces, and some just stood on the street. Many had their own cardboard versions of the world’s richest man: a shopkeeper and his two young children held a headshot of Bezos on the Zoom call, along with a cutout of the multi-headed demon king Ravana with “AMAZON” emblazoned across his chest.
On Khandelwal’s cue, they set their effigies of Bezos ablaze. During Holi, the effigy burning represents the destruction of the demoness Holika, an annual triumph of good over evil. For the shopkeepers and traders, Bezos was the demon to burn this year.
The stunt was the latest in Khandelwal’s playbook. The 60-year-old is a businessman with deep ties to Narendra Modi’s Bharatiya Janata Party, or the BJP, and has been in the public eye as the leader of CAIT for over 30 years. Khandelwal and traders like him are the bread and butter of Modi’s support in India; they represent the Indian Main Street, the homegrown economy Modi loves to boast about in his speeches. But pandemic-induced lockdowns have ravaged brick-and-mortar businesses in India, giving foreign e-commerce platforms like Amazon a shot at cracking India’s one billion-plus consumers.
While more and more Indians turn to Amazon and e-commerce platforms like it— its 90 million online shoppers are estimated to nearly quadruple by 2025—Khandelwal’s supporters are pushing for their prime minister to take a firmer stance against the Bezoses of the world setting up shop on their turf. Khandelwal is even launching a trader-friendly e-commerce platform, aptly named Bharat E Market, or “India’s E Market,” to try and eke out a share of an online economy closing around them.
As the mannequins began to burn and plumes of smoke appeared on the screen, the sellers on the call began chanting “Amazon Go Back!” in unison, a reference to anti-colonial calls against the British.
“Why are we burning their effigies?” Khandelwal screamed into his computer camera. “We’ve decided to burn the effigies of Amazon and Flipkart on this day of Holi to show them that India’s laws are not weak, that India’s government is not weak.” The traders cheered in unison. “You’ve made this an issue for every village, every town, and as a result, all of us have come together.”
In December 2019, Khandelwal was browsing the internet on his iPhone late one night when he saw a headline about Jeff Bezos visiting India. Though he’s built a reputation fighting corporate interests for small businesses since the 90s, Khandelwal has made Amazon his main target since 2016, when India relaxed its foreign investment laws and the e-commerce giant began bumping up his coalition of small business owners.
The Amazon CEO was to meet with the prime minister and senior cabinet members on his fourth trip to the country since the e-commerce giant established a center here in 2004. “During his previous visit (in 2014), he got the red carpet welcome at the PM’s house,” Khandelwal lamented. He vowed to make sure Bezos didn’t get the same treatment this time around.
Khandelwal, whose round, mustachioed face illuminates with a smirk whenever he comes up with one of his publicity stunts, speaks disorientingly fast, and he only slows down when he switches into English. He’s a wealthy man — his family’s wholesale hardware business has a storefront in one of Delhi’s busiest market roads — and is driven to his many meetings with politicians and businessmen in his maroon Jaguar. He wears an emerald ring on his pinkie finger, and carries a wad of cash in his inner pant pocket, matching the trope of a lala ji, a traditional Indian businessman.
In his office, located inside his family’s store, bright yellow walls are lined with dozens of framed photos, including a black-and-white portrait of three generations of the Khandelwal businessmen wearing princely clothes. On the opposite wall, there’s a 3-foot-tall collage of Khandelwal sitting alongside Prime Minister Modi, both of them laughing. Khandelwal’s family supports Modi’s BJP devoutly, in part because of the prime minister’s support for traders like them.
Since coming to power in 2014, Modi has made it clear that India is open for business. “India will be open and friendly — for business, ideas, research, innovations, and travel,” he wrote in his first op-ed as prime minister for The Wall Street Journal. As the chief minister of the Indian state of Gujarat, he cultivated a business-friendly reputation for years, which helped him secure the support of Indians at home and abroad eager to improve the country’s international standing.
Though Modi campaigned on opening India to business and innovation from abroad, he also promoted the idea of putting Indian businesses first. Soon after entering office, Modi’s government enacted the Make in India campaign, an initiative to boost India as a manufacturing leader in the global market by relaxing certain foreign investment regulations. In many ways, the push to open India’s borders to foreign investors worked: The inflow of foreign capital to the country is at an all-time high. He kicked off his 2019 election campaign with the promise of a “new India,” one that Modi declared would be “in tune with its glorious past,” promising economic growth and a prosperous nation.
But the efforts to solidify India’s position in global trade haven’t had the same effect for local businesses. By the time Modi was preparing for re-election in 2019, India’s economic growth had slowed to its lowest level in three years, only worsened by this year’s wave of Covid-19. In an effort to boost a flagging economy, the Indian government is undertaking its biggest privatization drive in more than a decade, selling its position in major state-owned enterprises. And while small businesses struggle under dire economic outlooks, the combined market share of Amazon and Walmart-owned Flipkart has grown significantly. This year’s prolonged lockdowns have only secured Amazon’s position further: Sales have doubled since the pandemic began.
Bezos’ second trip to India came shortly after Modi was sworn in as prime minister, and one year after the e-commerce giant fully entered the Indian market. Shortly before the trip, Bezos announced a $2 billion investment in India to help grow its presence across the country, and met with Modi in his office. The Indian prime minister tweeted an image from the meeting, the pair of them smiling at one another.
Despite Bezos’ warm reception, India has safeguards in place to prevent Amazon and other e-commerce players from taking over the Indian commercial market. Unlike in the U.S., where Amazon can sell its own inventory directly to customers on their platform, Indian law restricts e-commerce sites from holding and selling their own inventory, a restriction meant to protect small businesses. It meant that Amazon could only collect fees from Indian vendors for listing their products, and couldn’t create exclusive deals directly with manufacturers to create Amazon-branded products.
But Amazon was already working around these restrictions by creating its own Indian seller entities, the most prominent of which is called Cloudtail. Founded in 2014 as a subsidiary of a Bengaluru company called Prione Business Services, Cloudtail was formed as a joint venture between Amazon Asia and an Indian venture capital firm founded by the billionaire founder of Infosys, N.R. Narayana Murthy. A 2021 Reuters investigation found that clever maneuvers like Cloudtail allow Amazon to thrive in India: Although the country’s Amazon marketplace was crowded with hundreds of thousands of sellers — small and large — about 35 merchants account for over two-thirds of its online sales there through early 2019, benefiting Amazon and big commerce.
Amazon’s continued efforts to avoid Indian legislation enrage Khandelwal. “These companies are holding sales year-round, giving unimaginable discounts,” he told Rest of World. “So, they are openly flouting the policy and the law.”
In 2018, Modi’s government announced further restrictions on e-commerce in an effort to stave off the progress of big platforms. These rules were specifically geared towards foreign e-commerce companies like Amazon and Flipkart, and prevented them from owning more than 25% of seller entities like Cloudtail. For Modi, the timing of the rule was crucial: He was on the campaign trail to secure his second term as prime minister, and for the BJP, small traders like Khandelwal constituted a strong support base, one he couldn’t afford to alienate. The move pacified small traders and Khandelwal, forced Amazon to sell a partial stake in its two seller entities, and caused temporary outages as several products — including Amazon-brand items — were temporarily unavailable on the Indian version of the platform. By the time Bezos announced his visit in January 2020, his company’s standing in India had changed considerably.
So at 5 a.m., the morning after Khandelwal read the news of his visit, he sprang into action. He messaged attachés of the Prime Minister’s Office, telling them Bezos’ visit would send the wrong message to small businesses, which were being destroyed by Amazon. Under his trade union’s letterhead, he sent an email to Modi’s office, which he later shared with the media. “Amazon CEO Jeff Bezos’ eagerness to meet Prime Minister [sic] is certainly to shield unfair business activities in e-commerce,” read the message.
“We sent that letter not just to the PM, but to the BJP president, the home minister, the defense minister, the finance minister,” Khandelwal recalled. Soon, calls from ministers began to trickle in. Local media picked up the story. By 9 a.m., virtually all crucial political functionaries in the BJP government had received the letter from Khandelwal’s trade lobby urging them not to meet with Bezos.
The lobbying worked. Bezos didn’t meet with a single minister or government official during his three-day trip in January 2020, and Modi’s office reportedly refused an appointment. Khandelwal and CAIT, the trade organization, doubled down and arranged a protest near the Delhi venue where Bezos spoke. As the tech CEO, wearing a blue sherwani coat, bowed with his hands in the traditional Hindu greeting to a packed auditorium, Khandelwal and dozens of retailers chanted “Amazon go back!” Khandelwal, fist in the air, led the chants with a microphone.
The reception was a marked change from Bezos’ previous visit. Gone were the red carpets and Modi tweets. This time, India’s commerce minister Piyush Goyal publicly trashed Bezos’ $1 billion pledge to help small business traders.
Soon after Bezos left the country, the commerce minister met with Khandelwal.
The Khandelwals set up their trade in Delhi in the early 1900s, and made their fortune selling building hardware. In post-Partition India, when the country’s economy was largely shut off from the global market, their business provided these wares when few imported products were available. “Our family people used to import everything — playing cards, key chains— because those things weren’t made in India then,” said Khandelwal.
Khandelwal is a political showman, whose stunts have endeared him to a local media always hungry for his colorful comments. He has become a regular talking head on television. Effigy burnings and sit-ins are a major part of his playbook; so is his Twitter feed, which is a never-ending stream of scorn against e-commerce. But he is connected, and in a country where one’s patronage and lineage matters, his heritage opens doors.
India’s merchant class has a long and storied history, one dominated by the baniya community, which belongs to the vaishya caste. In the Hindu caste system, it places them in a social class that deals with moneylending, banking, and trading commodities. During the Mughal rule, baniyas were woven into the mercantile tradition: “No transaction could take place without his knowledge,” wrote historian Syed Ali Nadeem Rezavi. Over the years, the baniya caste’s association with trading success has led them to become India’s most powerful business community. Many prominent Indian business tycoons — the Ambanis, the Birlas, the Jindals — hail from the baniya caste, and their personal and industrial history follows the trajectory of India’s economy closely, extending into the country’s internet boom.
Growing up, Khandelwal always knew he’d join the family business, but he never expected it to happen as quickly as it did. In 1975, when Khandelwal was a teenager, then Prime Minister Indira Gandhi put the country in a prolonged lockdown known now as The Emergency. Following a war with neighboring Pakistan and heightened political tension, India was put in a 21-month-long period of suspended constitutional rights while Gandhi arrested thousands of political opponents.
Khandelwal’s father and uncle, heads of their business, were also members of a burgeoning outfit called the Jana Sangh, the political arm of the Hindu nationalist volunteer group Rashtriya Swayamsevak Sangh, or the RSS. The group has been banned multiple times for accusations of spreading communal hate, but in recent years has rebranded itself as a right-leaning youth organization. The movement went underground during The Emergency, and Khandelwal’s father was eventually arrested and imprisoned for the entirety of the nearly two-year ordeal.
Khandelwal still tears up when he talks about this period of his life, his normally boisterous demeanor giving way to memories of his teenage vulnerabilities. He remembers one visit to the prison when his father told him: “Though I know that you are a kid, you have a responsibility on your shoulders. You must go to the office regularly and help your uncle.”
The businessman’s politics were forged in the uncertainty of The Emergency years— his father’s Jana Sangh eventually became the BJP. Khandelwal said his allegiance to the BJP goes beyond the ballot: “This is heartfelt. We are wedded to the ideology.” Khandelwal spent his teenage years working in the RSS’ student wing alongside people who would go on to become part of Modi’s inner sanctum. He had a knack for publicity even back then, and ran media relations for the student group, typing up press releases and delivering them to editors in media houses.
Khandelwal was energized by Modi’s 2014 landslide victory. The rise of the right-wing populist government coincided with his own growing presence as a trade leader. But despite their shared Hindu nationalist ideology, Modi’s desire to bring foreign investments to India put Khandelwal at odds with his own party’s economic policy: Khandelwal believes welfare and an inward focus on Indian retail and trade is the path forward.
According to political scientist and author Vinay Sitapati, Hindu nationalism “doesn’t have an ideological view on economics.” While the nationalist political doctrine speaks of organizing and uniting Hindu society to create a permanent voting block, Sitapati said Hindu nationalists are murkier on issues of governance and foreign policy. Much of India’s modern history was defined by the closed-off, self-reliance economic doctrines of the Congress Party, which dominated India right up until Modi’s reign. It led to widespread social unrest and economic stagnation, which ended in a 1991 financial crisis that prompted India to open its borders to free trade.
Some factions of the BJP were vehemently opposed to the reforms of the early ’90s. The ideological vacuum resulted in “various BJP leaders espousing different views on economics over the last 50-60 years,” said Sitapati, “and much of it contradicts each other.” Modi, even before ascending to the prime ministership, is firmly in the reform camp, and is often credited with transforming the state of Gujarat by inviting big, foreign businesses to set up manufacturing there while he was chief minister. And with him at the helm, the BJP of today has a zeal for market-oriented economics. Barring the occasional posturing of atmanirbhar bharat, or a self-reliant nation, Modi’s policies have welcomed privatization and foreign investment.
“The BJP, right from the beginning, had a political sense that if it gets seen as a right-wing party in India economically, not socially, it’s bad for winning elections,” said Sitapati. Upper-caste traders like Khandelwal “still exercise some influence for historical reasons, but that has not translated into protectionist policies.”
It has put Khandelwal and CAIT at the forefront of an uncomfortable battle, one that pits them against some of the hallmarks of Modi’s economic policies. The lobby group — and by extension Khandelwal — rose to prominence in 2018 when it threatened nationwide demonstrations against the $16 billion majority acquisition of the Indian e-commerce giant Flipkart by Walmart. They called the deal “cancerous” to retail and lobbied regulators to scrutinize the acquisition, but Modi’s office and the Ministry of Commerce and Industry, and the Competition Commission of India signed off on the deal. Since the acquisition, Flipkart has gone from 10 million to some 108 million users. As Amazon and Flipkart expand in India, certain sectors of the retail market have been especially hard-hit, including retailers of consumer electronics. By 2020, one in two mobile phones in India were sold online, leaving brick-and-mortar retailers reeling.
For cellphone sellers like Arvinder Khurana, the shift was brutal. Before e-commerce, Khurana said, “I wouldn’t even find time to eat food, we were always standing and selling.” But after 2015, when Amazon and Flipkart began offering exclusive smartphone models online and pairing them with deep discounts, retailers like Khurana couldn’t compete. “I noticed that the kids of my top customers were coming to the shop, but not buying phones,” said Khurana. “They would check the phone in my store and order online.” He said 25 of the most low-cost smartphones weren’t even made available by brands to stores like his.
Retailers scrambled, banding together to purchase from the online flash sales just to get their hands on exclusive inventory. Khurana describes shop owners hobbling together 30-odd credit cards and IDs to bulk buy the online-only cellphones for their own stores. But the hacks were a last-ditch effort to compete in a system stacked against store owners: Over 40,000 mobile phone stores have shuttered since 2019, according to the All India Mobile Retailer Association. Khurana closed three of his own stores, as well as the employees who worked there. They’re now “driving taxis with Uber, some are cutting hair in a salon,” he lamented. “Educated guys are being ousted from the industry.”
In response, Indian authorities have slowly begun to take action against e-commerce platforms. In January 2020, the week of Bezos’ scheduled visit to India, the country’s antitrust regulator opened a formal investigation into Amazon and Flipkart based on complaints from a New Delhi-based trader group. Khandelwal and Khurana, along with other affected traders, alleged that platforms were influencing prices through deep discounts and exclusive partnerships, especially in the sale of mobile phones, and giving preferential treatment to select sellers by helping them strike deals with manufacturers.
When reached for comment by Rest of World, a spokesperson for Amazon India declined to comment. In an April press release, the company said over 50,000 offline retailers and neighborhood stores are selling on Amazon.in, and that it has helped create nearly 300,000 “direct and indirect” jobs in India since January 2020.
Before the commission could begin its probe on whether these exclusive arrangements violate Indian antitrust laws, Amazon challenged the decision in a Bengaluru court, and the investigation is on hold. A 2021 Reuters investigation renewed calls from offline retailers for the investigation to continue, and a court said the investigation’s findings corroborates long-standing allegations of preferred sellers. Khandelwal called for an “immediate ban on operations of Amazon in India” after the report was published, resuming calls for new rules to restrict online commerce. His calls picked up press traction, but unlike his big anti-Bezos stunt, not much else happened.
In May 2020, as much of the world was still reeling from the health and supply chain effects of the pandemic, India came out of sweeping nationwide lockdowns relatively unscathed. Optimistic policy makers predicted a V-shaped recovery, spurred by Modi’s push for an India-first path to recovery. “Vocal for local” became the administration’s mantra. “The corona [sic] crisis has taught us the value of local manufacturing, local markets, and local supply chains,” said Modi in a televised address to the nation. “Local is not only our need, it is also our responsibility.”
For Khandelwal, who saw his friends and neighbors turn to online shopping during the first wave of lockdowns, the message was a personal call to action, a sign to finally resurrect an idea he’d been mulling for years: his own local e-commerce platform. In September 2020, CAIT unveiled Bharat E Market (Bharat is the Sanskirt name for India). The platform is meant to “bring your neighborhood stores closer to you, just a click away,” read a press release about the platform.
Khandelwal’s concept for Bharat E Market is simple: The marketplace serves as a platform for the kiranas, or mom-and-pop corner stores where Indian households buy the majority of their everyday goods — without commission charges for sellers. On Bharat E Market, traders of all stripes can create their own e-shop, offer private discounts to customers, and theoretically reach a bigger customer base, too. Users on the platform simply enter their area code, Khandelwal explained, and can shop from any store within 3 miles of them. While he had been considering such a platform for years, old-school shopkeepers had been reluctant to change. “Covid is a blessing,” said Khandelwal. “Now every trader, every Tom, Dick ,and Harry, realizes the power of e-commerce.”
But it’s hard to imagine Bharat E Market can compete with the likes of Amazon or Flipkart, or even local competitors building their own platforms. The site has been built by a team of five coders in the city of Indore, known more for its cotton and textile industries than its coders. The platform’s founding members are mostly old-school traders in their fifties, and as the head of Bharat E Market, Khandelwal runs the site more like a political operation than an e-commerce startup. He’s picked 56 locally-recognized businessmen he calls “e-commerce warriors” to conduct workshops intended to train vendors on how to register and use his platform. He describes his coworkers as “volunteers who are “dedicated” and “honest” people, a very Gandhian approach to a market driven by profit margins.
“The 56 people will be roaming in their state, creating awareness about Bharat E Market, and telling people to join,” said Khandelwal.
Though the pace of e-commerce adoption has put Khandelwal and traders like him on the defensive, e-commerce currently makes up just 2% of retail in India. For Amazon, too, the revenues from India are relatively small, even compared to its other foreign markets like Japan. According to Forrester, India accounted for just 2.2% of Amazon’s global gross merchandise value in 2020. In other words, there’s plenty of headroom for local competitors to grow as viable competitors. Mukesh Ambani’s conglomerate Reliance, as well as Indian industrial giant Tata Group, are two of the recent entrants in the e-commerce marketplace — both have acquired a majority stake in some key local startups in recent years. Amazon and Reliance are in the midst of a high-stakes court battle to secure control of an Indian supermarket chain worth $3.4 billion in the hopes of solidifying their stakes in the online retail market.
Alongside major conglomerates, hundreds of well-funded ambitious local startups are helping the digitization of millions of corner kirana stores. Founded in 2012, Fynd is one such platform. Co-founder Harsh Shah launched it with the hopes of helping offline retailers sell their products directly through its store, and enable them to work with third-party platforms like Amazon. 32-year-old Shah, a graduate of the famed Indian Institute of Technology, fits the profile of an e-commerce platform more than Khandelwal and his cadre. Shah said though pandemic-related lockdowns have forced their hand, traders “needed to have done this much earlier. I think it was a large number of years spent on not believing in and dissing e-commerce and technology… rather than looking at it as something which is a new way of doing business.” Shah believes the future for small store owners is in a mix of online and offline selling. Big platforms “will never be able to replicate” the access to inventory and customer loyalty of small shops, he said. Harsh’s Fynd is now majority-owned by Reliance, which acquired an 87.6% stake in the company in 2019.
Bharat E Market pales in comparison to startups like Fynd. Khandelwal is clearer about what the platform is not than what it will be. He said there will be no foreign investment, no Chinese products, and only Indians would work to build the platform. While Amazon’s model lists “customer obsession” as one of its key principles, Bharat E Market is “of the traders, by the traders, for the traders,” as Khandelwal said in the platform’s launch video. Although Khandelwal said 100,000 traders have signed on to the initiative, the portal isn’t active for customers to use yet, and that the site will be functional in the coming months.
It has left Khandelwal and the traders who work with him in a precarious position. Even with his considerable connections within the BJP, the middle-aged businessman feels his party could do more. “In the next six months, there will be change,” he said, a little less optimistic than usual. “But certainly, yes, so far, the traders have not been given their due in India, despite the fact that they are rendering the best possible services to the people of India.”
He’s reluctant to criticize Modi’s government, but the past seven years of BJP rule have worn on Khandelwal as he fights an increasingly lucrative and large industry, growing by the day. Khandelwal sees the fight as part of an older battle, harkening back to the colonial looting of India by the British that left many in his merchant class impoverished. He remains suspicious of foreigners with briefcases.
For Khandelwal, whose family has steadfastly supported the BJP for generations, Modi’s “new India” was meant to include traders like him. He sees his faith and trading business as one, his devotion to both folded into his loyalty to Modi himself — his WhatsApp photo shows him sitting next to the prime minister. But as the country opens its market to foreign competition, he might find Modi’s new India will come at his expense.