Amazon and Walmart are now racing to reduce plastic pollution in India

New Delhi (CNN Business) Amazon and Walmart have spent months fighting to be the leader of India's large online retail market. They're now entering a race to eliminate single-use plastic packaging.

Plastic pollution is a huge problem in India. The government estimates that about 70% of the plastic the country consumes is simply discarded and there is no processing of waste in most Indian cities.

Amazon (AMZN) announced Wednesday that it will remove all non-recyclable plastic from its deliveries in India by June 2020, replacing the "air pillows" and bubble wrap it uses to protect products with padding made out of paper.

The company's packaging material already contains less than 7% single-use plastic, according to Akhil Saxena, Amazon India's vice president of customer fulfillment.

"This investment in protecting the environment ensures a triple win — it is good for our planet, good for our customers and community, and good for the business," Saxena said in a statement.

The announcement comes less than a week after Walmart (WMT)-owned Flipkart, India's biggest e-commerce company, unveiled a similar initiative. Flipkart — which said it reduced the amount of single-use plastic in each package by 25% in the past year — has set itself a deadline of March 2021 to make all its packaging recyclable. Walmart bought Flipkart last year.

Flipkart holds a slender lead over Amazon at the top of India's e-commerce market, which Morgan Stanley predicts will be worth $200 billion by 2027. Each company accounts for a little over 30% of the market, according to estimates from the research firm Forrester. Both have invested billions of dollars to grow their business as they battle to reach more than half a billion people set to come online over the next few years.

India's Prime Minister Narendra Modi last month called on companies and individuals to reduce plastic pollution, saying in his Independence Day speech that India should take "strong first steps" to eliminate single-use plastic by October 2.

"I urge the startup founders, technicians and industrialists to find ways to recycle plastic," Modi added.