Alibaba Group freezes investment in Indian startups

Chinese e-commerce giant Alibaba Group has put on hold plans to invest in Indian startups, Reuters reports.

Citing two sources, the article states that Alibaba, which has invested more than $2 billion in Indian startups since 2015, plans to freeze new investments for at least six months, although it does not intend to reduce its stakes in existing portfolio firms.

The move comes amid souring business relations and rising political tension between China and India after a clash on their Himalayan border in which 20 Indian soldiers were killed. India then imposed stricter curbs on Chinese goods and businesses amid calls for boycotts.

Alibaba Group, and its affiliate Ant, are major investors in a handful of unicorns in India including digital payments venture Paytm, food delivery startup Zomato, grocery delivery startup BigBasket, and e-commerce firm Snapdeal.

Ant Group, which is preparing for an IPO, this week flagged up the challenges it faces in India. In its IPO filing, Ant said a change in foreign investment rules in the country had led to a “further evaluation of the timing” of its additional investment in Zomato. 

Alibaba did not respond to a request for comment.

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