Amazon and Flipkart suspend all services in India amid lockdown confusion

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India’s biggest ecommerce businesses Amazon and Walmart-owned Flipkart were forced to suspend all services in the country on Wednesday, amid mass confusion over the details of its strict 21-day coronavirus lockdown.

In a dramatic Tuesday night television announcement, Prime Minister Narendra Modi ordered all of India’s 1.37bn people not to move out of their homes for the next three weeks, sending ripples of anxiety through India’s urban middle class about the operation of the supply chains that sustain them.

“Things are almost completely at a standstill,” said an executive at one ecommerce company, who asked not to be identified because of the sensitivity of the situation. “We have a lot of pending orders and a lot of deliveries stuck in various parts of the supply chain, from leaving the warehouse to reaching our customers.” 

In his televised address, Mr Modi promised Indians that the government would ensure an uninterrupted flow of essential supplies, like fresh fruits and vegetables, milk and medicines, and urged them to rely on ecommerce companies and other delivery services to avoid the need to venture out. 

However, this statement — which appeared to be at odds with the blanket lockdown order — sowed confusion over whether or not couriers were exempt. According to ecommerce companies, overzealous local police have since been stopping delivery drivers they perceive to be flouting the rules, and barring trucks carrying staples such as fruit and vegetables from crossing state lines. 

“We are not operational today due to restrictions by local authorities on movement of goods,” said Alibaba-backed Big Basket, one of many online grocery companies also affected by the confusion, on its website. “We are working with the relevant authorities to enable delivery as soon as possible.” 

Rajneesh Kumar, chief corporate affairs officer for Flipkart, said the company has halted its services “as we assess the possibilities of operating during the lockdown”. Amazon’s grocery service, Amazon Pantry, was also suspended, with its website citing “unforeseen circumstances”. 

Meanwhile Mr Modi’s edict also led to a spike in order volumes. Grofers, a grocery app backed by SoftBank, said its app crashed just 15 minutes after the premier’s speech on Tuesday, as the result of an unprecedented surge of panicked orders. 

Even before the speech, daily order volume at the company — which operates in 27 Indian cities — doubled from its usual 100,000 checkouts per day to around 200,000, as public awareness of the threat of coronavirus grew. 

According to Albinder Dhindsa, Grofers co-founder and chief executive, shortly after the speech, their traffic surged by a factor of eight, with 300,000 people trying to order simultaneously, crashing the app.

Even with its app up and running again, Grofers’ business faces further obstacles, with government-mandated warehouse closures and a huge backlog of orders.

But Mr Dhindsa said the government appears to be working hard to sort out its problems and get services up and running. “It’s getting better in terms of clarity of what is happening on the ground,” he said. “We are starting to get passes from local administrations to be able to operate goods vehicles and open warehouses.” 

Still, Grofers’ backlog raises questions about the industry’s capacity to handle the continued demand from customers needing to stock up. 

“Ecommerce by itself is not equipped to service even a city like Delhi,” said Mr Dhindsa. “The government is trying to mobilise a lot of different sectors.”

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