The US e-commerce giant is partnering with Future Retail, which has more than 1,500 stores across 400 Indian cities, the companies announced Monday. The deal will make Amazon the official online channel for Future Retail's hundreds of stores, and Amazon will add Future Retail's grocery products to its two-hour Prime Now delivery program in India. Future Retail will also allow customers to pick up products they order on Amazon from its stores.
Read MoreThe latest deal with Future Retail, which has a market value of over $2 billion, will also boost Amazon's ammunition against a new e-commerce push by Mukesh Ambani.Reliance, the company owned by the billionaire, recently launched an online retailer called Jio Mart offering free home delivery for thousands of grocery products.