Ever since DIPP has formulated the FDI ecommerce policies, it became a heated topic of debate among different sections of the startup ecosystem. On one side, government is announcing different policies to help startups in the country through its Startup India Mission and on the other, policies like these have really disappointed the entrepreneurs.
Indian ecommerce players are not taking well to the harsh policies imposed by DIPP and have decided to fight back. Over 100 ecommerce startups have teamed up to fight against this announcement and ask the government to re-think on the policies.
The president of the association will be elected in sometime. Rumours has it that it will either be Kunal Bahl, Binny Bansal or Vijay Shekhar Sharma, who will be leading the protest stage outside DIPP’s Udyog Bhawan office in New Delhi.
We are yet to confirm on whether Amazon will also be joining the protest.
The government has recently divulged rules that permits 100% FDI in business to customers (B2C) ecommerce. But leaving no room for ambiguity, the new guidelines have clarified definitions of ‘ecommerce’, ‘inventory-based model’ and ‘marketplace model’, thus disallowing foreign investment in inventory-led models. In addition, it also proscribed huge discounts and predatory pricing. Two other discouraging highlights of the ruling are:
- An ecommerce entity will not permit more than 25% of the sales conducted through its marketplace from one vendor or their group companies
- Ecommerce companies will not directly or indirectly influence the sale price of goods or services, and shall maintain level playing field
We tried talking to some entrepreneurs and here’s what they said: