Facebook on Wednesday announced an investment of Rs 43,574 crore to buy a 9.9 percent stake in Reliance’s subsidiary Jio Platforms. This deal is being considered as the largest Foreign Direct Investment FDI in India’s technology sector for a minority stake.
Reliance Jio has over 388 million customers in India and is the highest growing telecom company since its inception. With this investment, Jio Platforms, Reliance Retail and Facebook’s WhatsApp can be seen together to speed up Reliance Retail’s JioMart using WhatsApp and to support small businesses in India.
Mukesh Ambani invested nearly $40 billion in Jio in 2016. RIL is one of the largest retailers in the country growing aggressively in e-commerce and grocery.
For Facebook, India is an important market as it has more users in India than any other country. WhatsApp has over 340 million users and is planning to launch a digital payment competitor to players like Paytm, Google Pay, PhonePe and Amazon Pay. Having a quality telecom partner could help Facebook improve its business. Also, this deal will help Facebook compete with growing video-sharing apps like TikTok.