Paytm plans to cash in on Amazon’s India distress

India’s online retail industry has been in turmoil since the government implemented stringent new rules to rein in major players like Amazon.com Inc. and Walmart Inc.’s Flipkart. Amid the uproar, Vijay Shekhar Sharma — whose two-year-old Paytm Mall is backed by Alibaba Group Holding Ltd. — is quietly devising ways to outstrip his rivals.

The new regime forbids retailers from holding any business interest in online merchants on their websites, exclusive arrangements and deep discounts — forcing Amazon and Flipkart to redraw contracts and rescue thousands of product listings that vanished overnight. The founder of Paytm Mall operator Paytm E-commerce Pvt, an affiliate of India’s largest digital payments provider, spoke in an interview this week about how his business stands to gain.