Chinese internet giant Alibaba has been trying to get direct entry into the Indian market for the past two years.

Alibaba, which is planning to enter Indian market by early next year, has reportedly started talks to buy one of the country's biggest e-commerce marketplace ShopClues. Alibaba's Asia market development executive K Guru Gowrappan is reportedly holding discussions with ShopClues management.

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Alibaba apparently aims to merge Paytm, a leading online payment service in which the company invested recently, with ShopClues. "Alibaba wants to merge the marketplace of Paytm, in which it has a stake, with the much bigger rival ShopClues, as it is prospecting several acquisition targets to firm up an India entry against rival Amazon," sources told the Times of India newspaper.

Valued over $1 billion, the Gurugram headquartered ShopClues comes second only to Alibaba in the number of merchants (around 500,000) it has. ShopClues, however, declined to comment on the developments when contacted by the newspaper.

Alibaba, which sees India as an important market, is looking to enter the country in a big way to compete with its U.S.-headquartered rival Amazon. Alibaba is likely to make its Indian entry by acquiring major e-commerce players such as Flipkart, ShopClues, Snapdeal, and Paytm. The company has already invested in Paytm and Snapdeal.

"Alibaba is very keen on coming to India in a very big way, particularly in the e-commerce sector. They're only exploring the way - whether to go on their own or set up shop with someone else," a senior Indian official said a few months ago.   

TagsAlibaba, India, shopclues, Paytm, Snapdeal, Amazon