NYSE-listed Sea to shut its e-commerce unit in India due to “market uncertainties”
Southeast Asian tech giant Sea said on Monday it is shutting down its e-commerce business, Shopee, in India, due to “global market uncertainties.”
The Singaporean e-commerce platform is scaling back its aggressive expansion. Last month, it announced the closure of its France operation, saying it would continue to adopt an “open-minded and disciplined approach to exploring new markets”.
In a notice to sellers, Shopee India said it would cease operations starting March 29 at 12 am. After that, buyers won’t be able to place new orders, while sellers have been given time till May 30 for payment withdrawals and return.
The company assured that prior orders will continue to be processed and fulfilled “as usual” and will provide after-sales service and support to all users who make purchases on the platform.
“In view of global market uncertainties, we have decided to close our early-stage Shopee India initiative. During this period of transition, we will focus on supporting our local seller and buyer communities and our local team to make the process as smooth as possible. We will continue to focus our efforts on delivering a positive impact to our global communities, in line with our mission to better the lives of the underserved through technology,” the company said in a statement.
Shopee India’s shutdown comes only weeks after New Delhi banned Sea’s most popular mobile game title, Free Fire, citing security concerns due to its Chinese connections. The PUBG-like free-to-play battle royale game has more than 40 million monthly active users in India and may account for around 10% of Sea’s gaming revenue.
The block on Free Fire has also raised concerns for the Singapore government, given that Sea is the most valuable public-traded company in the city-state. In early March, its trade and industry ministry said that it hoped India’s ban on Free Fire would be resolved quickly.
After Free Fire was banned, the Confederation of All India Traders (CAIT) once again called on the Indian government to block Sea’s e-commerce platform Shopee because its data is stored on Tencent Cloud. Earlier, when Shopee entered the South Asian market in 2021, CAIT has suggested the Indian government to ban it, claiming that “unfair trade practices” will harm the local ecosystem.
Founded by Forrest Li, a naturalized Singapore citizen who hails from Tianjin in China, in 2009, Sea has three business lines, gaming platform Gerena, e-commerce business Shopee, and digital payments service SeaMoney.
To curb the regulatory risks Sea may face in some markets that are increasingly hostile to Chinese companies, its lead investor Tencent has reduced its sway over the Southeast Asian upstart. In January, the Shenzhen-based company cut its stake in Sea from 21.3% to 18.7% by selling shares worth between $2.8 billion and $3 billion, and gave up a significant portion of its voting rights.
According to NDTV’s report, India has blocked 321 apps since the border tension with China flared up in May 2020.