Ecommerce policy must contain restrictions on offering discounts and freebies, says CAIT
Traders body demands for a provision for inventory holding, and a regulator to regulate and monitor ecommerce platforms
It also suggests to create an effective grievance forum to hear the grievances of the consumers
Traders organisation, Confederation of All India Traders (CAIT) has written to the Ministry of Commerce stating that the fundamentals of the proposed draft ecommerce policy should not be diluted.
Supporting the demand of CAIT, Department of Industrial Policy & Promotion (DIPP) DIPP Secretary Ramesh Abhishek too sought a crackdown on deep discounts currently being offered by ecommerce platforms in India.
Speaking at a roundtable conference organised by Swadeshi Jagran Manch (SJM) on ‘Ecommerce Policy’ Ramesh Abhishek also demanded, “Probe ecommerce companies for FDI violations.”
The draft policy, which has received conflicting viewpoints, was recently submitted to the Prime Minister’s Office (PMO) as various ministries and departments questioned provisions of the policy.
The draft ecommerce policy –submitted by the ecommerce think tank headed by Union Commerce Minister Suresh Prabhu –suggests that India-owned and India-controlled online marketplaces should be allowed to hold inventory as long as products are 100% domestically produced, and such businesses can have up to 49% FDI.
“Several vested interest people are lobbying hard to make the ecommerce policy according to their whims and wills, which will not be accepted by the community,” CAIT said in a statement.
According to CAIT, these are the fundamental issues to be discussed under the ecommerce policy:
- Ecommerce platforms are violating the conditions imposed under Press Note 3 (which rejects one seller from selling more than 25% of the total products on the marketplace)
- No investigation has been conducted yet on issues and complaints related to the Press Note 3 violation
- The approval of Flipkart-Walmart deal by Competition Commission of India’s (CCI)
CAIT believes that the Walmart-Flipkart deal will affect the small local retailers in India. Thus, to protest against the Walmart-Flipkart deal, along with the alleged discriminatory treatment against traders, CAIT has announced Bharat Bandh on September 28, a nation-wide Rath Yatra on September 15, and a mega rally on December 16
CAIT has also given a few suggestions for the proposed ecommerce policy to the government. This includes:
- Ecommerce policy must contain restrictions on offering discounts and freebies
- There should be a provision for inventory holding in cases which will allow the entry of FDI in retail
- Holding inventory clause in the policy proposal should be withdrawn.
- There should be a regulator to take penal action against ecommerce platforms which are violating the policy, rules or regulations.
- There should be a forum to hear the grievances of the consumers.
The ecommerce policy draft is seen as a critical step to ensure a level playing field for local businesses in digital trade in India, where deep-pocketed foreign companies are investing and contesting aggressively.
The second draft of ecommerce policy, with inputs from stakeholders is expected to come out in a fortnight.
[The development was reported by The Economic Times.]